BEIJING: Chinese technology companies are foraying into the new energy vehicle (NEV) industry, believing that the smart driving functions of electric vehicles (EVs) will be key to winning market competition over the next decade.

From supplying autonomous driving systems to developing cars, tech companies such as Huawei Technologies Co and Xiaomi Corp are emerging as competitive auto players.

They bank on China’s complete and highly efficient supply chain, its huge research and development talent and the enthusiasm shown by local consumers for cutting-edge technologies, according to company executives and experts.

About 40% of new vehicles sold in China this year will be NEVs, and they will have smart features that help NEV makers stand out amid increasingly fierce competition, they forecast.

“The upward spiral is expected to continue, with about 50% of new vehicles sold in China being NEVs in 2025.

“This is expected to hit 70% in 2030, with annual deliveries reaching around 20 million units a year,” Ouyang Minggao, an academician at the Chinese Academy of Sciences, said.

Smart functions, with autonomous driving features at their core, are proving to be more important as automakers try to differentiate their products from others, Ouyang said.

“It is possible to introduce some basic driving-assist functions into petrol vehicles, but EVs have natural advantages in terms of precision control,” he added.

Eyeing the big opportunities ahead, Huawei is expanding its presence in the NEV sector.

Yu Chengdong, head of Huawei’s smart vehicle business unit, said: “We are expanding collaboration with partners in the Chinese automotive industry to usher in a new era of smart EVs, leading the comprehensive transformation of intelligent automobiles.”

Huawei has highlighted that it will not make the car itself.

It has so far adopted two strategies to be a part of the auto supply chain. One is to supply components and technologies to automakers, like its cooperation with Changan Auto, said Zhong Shi, an independent auto analyst.

“The other is the intelligent car selection mode. Huawei not only participates in product modelling, interior design and intelligent solutions, but is also responsible for the marketing and sale of cars.

“A typical example is its cooperation with traditional car brands which has proved to be highly successful,” Zhong said.

A recent case in point is how Huawei unveiled in April upgraded versions of its Luxeed S7 electric sedan in partnership with Chery Auto, as the tech company aims to expand its presence in the burgeoning but increasingly crowded NEV market.

The move came after Huawei’s sport utility vehicle Aito series, developed in collaboration with Chinese carmaker Seres, was widely accepted by consumers.

Aito M7, which has been on the market for seven months, has accumulated over 174,000 orders, and Aito M9, launched three months ago, has accumulated over 70,000 pre-orders, with a monthly delivery capacity reaching 25,000 units.

Available at a starting price of about 250,000 yuan in China, the latest S7 has received a major upgrade in intelligent safety with the inclusion of Huawei’s vision intelligent driving solution, which enhances the driving experience on highways and in urban areas, and simplifies intelligent parking, Yu said.

Its advanced intelligent driving system, called “navigation-based connected autonomous driving for urban areas”, has received a full-scale upgrade, with immediate delivery upon purchase. — China Daily/ANN