Aito’s trademark and patents will be sold for $343 million.
Huawei Technologies is selling the Aito electric vehicle brand to Chinese automaker partner Seres with the aim of enhancing its role as a system supplier for replacement carsBecoming a competitor.
Seres, which co-developed the brand with Huawei, said it would spend 2.5 billion yuan ($343 million) on Aito’s trademark and patents. The transaction is expected to close by the end of 2024, according to the Shanghai-listed automaker’s filings. Seres affirmed that this agreement will not affect the cooperation of both sides.
Huawei will transfer the Aito trademark to Seres and, in the meantime, continue to support Seres in the production and sale of Aito cars,” he said. Huawei said in a statement and reiterated its stance that the company will not produce its own cars.
The brand transfer takes place in the context that Huawei is looking to separate itself from the automotive manufacturing sector and strengthen its role as a supplier level and platform operator in the electric vehicle industry.
Previously, Aito marked one of Huawei’s big strides in 2021, when the tech giant was sanctioned by the US in search of a move c new revenue. Prior to co-launching Aito, Seres operated as a subsidiary of Shanghai-listed Chongqing Sokon Industry Group and was a little-known name to China’s automobile industry.
Huawei’s position has helped Aito become one of the fastest-growing electric vehicle brands in China. At the beginning of 2023, some retail stores have marketed the product under the Huawei Aito name, thereby raising speculation about its ambitions to produce its own cars a Huawei.
In November, Huawei announced plans for a joint venture with Changan Automobile, a major state-owned automaker based in the city of Chongqing in the Southwest, to focus on smart vehicle systems and components. Huawei has invited Seres to join this new venture and the two sides have had positive discussions.
According to experts, Changan’s cooperation with Huawei is a new breakthrough in the electric vehicle industry. Currently, all of the company’s moves are still being monitored to determine whether this electric vehicle business model is really effective in the long term i.
“Huawei’s strategy is to bring its technological strengths into as many different companies as possible so that when the market consolidates, they will have a platform to link with the surviving companies in the electric vehicle industry,” said Kollar, director of Intralink.
Huawei’s latest move comes amid fierce competition in China’s electric vehicle market. Brands try to win the war Win the price reduction war when the market appears more and more beautiful and advanced models. China’s top three high-end electric vehicle makers, Li Auto, Xpeng and Nio all recorded rapid sales growth in June thanks to programs discounts and incentives. Seres reported sales of 44,126 vehicles in June, up from 34,130 units in the previous month.
According to Reuters, smart cars are an area that Huawei chooses to pursue, partly because the chips in the car are not as modern as the chips on smartphones and are not on the US blacklist. The potential of China’s huge car market is also a plus.
“We are not good at competing with extremely low prices. Instead, we are only good at competing by value, by intelligence, luxury, comfort, safety, comfort and user experience”, Yu Chengdong, chairman of Huawei’s smart car division, said, implying that its rivals, such as BYD, racing to be ahead only because of low prices, not because of quality.
According to CNN, top executives in the electric vehicle industry still often post on social networks on a variety of topics, including technology and advertising. However, rarely does anyone mention the name of their opponent as directly as Mr. Yu Chengdong.
It is known that instead of reaching many consumers through an extensive dealer network, Huawei’s cars are mainly sold through the website and A Hang. This means that the number of potential customers is basically the company’s existing customer base.
In addition, instead of investing in the development of electric vehicles on its own like many other young startups, Huawei outsources most of the hardware and only focuses on the m segmentThey are the strongest: software. After developing the driver support and control system, Huawei only needs to brand and offer the product.
“In the era of increasingly popular smart electric vehicles, competition in this segment will become extremely fierce. In the long term, I believe that car companies that work closely with Huawei can survive and become one of the few companies that survive.” Richard Yu, director in charge of Huawei’s electric vehicle division, said.