Nearly half a year after the joint venture with Huawei was announced at the end of November, Changan revealed the latest progress of the project.

May 7, Changan Automobile (000625)SupersicbogameSZ) issued a notice saying that the company's investment cooperation project with Huawei is actively under way. At present, Changan Automobile has basically completed the financial, legal, business and technical due diligence involved in the project, and the two sides are conducting further negotiations on the key terms of the transaction.

In view of the importance and complexity of the project and the need for the parties to promote internal procedures, the progress of the project is somewhat late than expected in the memorandum. According to the latest project progress, the company expects to sign the final transaction document no later than August 31, 2024.

Picture sourceSupersicbogameChangan Automobile notice

The registration of the target company was completed in January this year.

In fact, this is three months later than the original deal.

Last November, Huawei and Changan Automobile announced that they planned to form a new joint venture. Huawei plans to integrate the core technology and resources of its smart car solutions business into the new company, which Changan Automobile and related parties will intend to invest in.

At that time, the parties planned to sign the final transaction documents within six months after the date of signing the memorandum, including the equity purchase agreement, the shareholders' agreement, the articles of association of the target company and the final transaction document.SupersicbogameHis documents related to this transaction.

Speaking of investing in Huawei's BU, Zhu Huarong, chairman of Changan Automobile, said that in the agreement, Huawei promised not to engage in the whole vehicle business and not to engage in the business of the new company.

In January this year, Huawei completed the registration of the target company, named Shenzhen Yingwang Intelligent Technology Co., Ltd. (hereinafter referred to as "Yingwang"), which is wholly owned by Huawei. Its business scope mainly includes car intelligent driving solutions, car intelligent cockpit, smart car digital platform, smart car cloud, AR-HUD and smart car lights, etc., subject to the final transaction document. In March, it is expected to set up subsidiaries in Shanghai, Hangzhou, Dongguan, Nanjing, Suzhou and other places.

Some analysts pointed out that Shenzhen will attract or load Huawei BU technology and resources, which will become a multi-shareholding technology open platform. This also means that Changan Automobile is only the first mainframe factory to cooperate, and there may be more car companies to participate in the follow-up.

Yu Chengdong, managing director of Huawei and chairman of BU for smart car solutions, once revealed that after Huawei's BU business moved towards independent operation and introduced investment, Changan took the lead in participating in the cooperation, and the new company has issued an open invitation to Cyrus, Chery, BAIC and Jianghuai, and hopes that powerful automobile companies such as China FAW Group will join.

FAW Group and Dongfeng Group are also expected to buy shares.

In addition to Changan Automobile, two central enterprises, FAW Group and Dongfeng Group, are also expected to take a stake. You Zheng, member of the standing Committee of the Party Committee and Deputy General Manager of Dongfeng Automobile Group Co., Ltd., said publicly that he is actively promoting participation in Huawei's smart car solution business in conjunction with FAW Group, and a preliminary conclusion is expected by June this year.

21st century economic report reporter also learned from a high-level GAC GROUP, "Guangzhou Automobile will comprehensively consider (whether or not to join the stake)." We will evaluate our competitiveness in terms of price, scale and so on. We will not buy shares in order to buy shares. Equity belongs to equity, while competitiveness belongs to competitiveness. We will not use it without quality and price advantages. "We are very willing to continue to cooperate with Huawei and agree with Huawei's technology, and then we are willing to maintain more space cooperation with Huawei," the person said. "

Some analysts told the 21st Century Economic report that due to the excellent quality of Huawei's smart car solutions, Huawei's unique corporate culture and its strong pursuit of voice in the industry, so far, the major automobile groups are afraid of Huawei when choosing the routes and partners of intelligent technology, which involves the so-called "soul" competition.

On the other hand, without more automakers using Huawei's smart car solution, it will be difficult for Huawei to recoup the huge investment in the project within a few years. And any technological solution will decrease with the delay of the marginal effect of technological advancement, and other more advanced technological solutions may be innovated at any time.

Therefore, for Huawei, the split of the car BU can not only reduce the financial burden, but also reassure the whole car factory, while Huawei continues to master the research and development technology and smart car selection business, leaving more room for development.

A new brand of smart driving, Qianqi, was released last month.

In April, a day before the opening of the Beijing auto show, Huawei's "car BU" made its debut after "becoming independent" last year, unveiling a new brand of smart driving, and announcing that the new generation of Hongmeng cockpit has evolved again, which is regarded as the independent market operation of Huawei BU is close to the "destination".

Jin Yuzhi, who made his debut as BU CEO of Huawei's smart car solution, announced the first seven partners of the Qianqi brand. Among them, Lantu and Mengshi brands under Dongfeng will be on the market by the end of this year. In addition, there are Changan's Deep Blue and Avita, GAC MOTOR, BAIC's Jihu and Hengjie, Selis Mente, Qirui Zhijie, and Jianghuai's new brands, with a total of ten strategic models on the market.

After independence, achieving profitability is one of the important goals within Huawei's BU. In March this year, Yu Chengdong revealed that Huawei's smart car selection business had turned from loss to profit in the first March of this year, and the car BU was close to the edge of break-even, and it is expected that it should be able to turn loss into profit from April and form a benign positive development.

With regard to the latest progress in profitability, Jin Yuzhi told the 21st Century Economic report that Huawei BU is not worried about profitability. "We think the direction of smart driving is right. Profits will happen sooner or later, and it doesn't matter which year they make profits."