Tech giants eye NEV growth
Domestic market continues booming despite chip shortage
Published: Nov 02, 2021 01:20 AM

The development of the new-energy automobile industry is in full swing, and more companies are joining the sector, including tech firms Baidu and Xiaomi.

 On Thursday, Baidu held an event in Beijing dedicated to its Apollo autonomous driving technology. The company announced an expansion of the Baidu Apollo robotaxi fleet, a tripling of the available safe road test mileage for autonomous vehicles and a significant update to its 5G Remote Driving solution.

First unveiled in June 2021, Apollo Moon is Baidu's 5th generation of robotaxis for fully autonomous ride-hailing services in the smart transportation industry. Compared to the 4th generation of Apollo robotaxis, the Apollo Moon models have half the manufacturing cost and a tenfold increase in performance.

With the introduction of three models to its robotaxi fleet - Apollo Moon Arcfox, Apollo Moon WM Motor and Apollo Moon Aion - Baidu hopes to expand the options for Apollo Go customers in cities across China and lead the robotaxi market by 2030, when it is expected to be worth 1.3 trillion yuan ($203 billion).

Baidu is not alone. Since the announcement of car production in March, Chinese technology giant Xiaomi has accelerated its move into the automotive industry and has invested in a number of companies in the field of autonomous driving and power batteries.

Lei Jun, CEO of Xiaomi Group, announced in October that the company's electric vehicles will officially enter mass production in the first half of 2024. He also said the company has made more progress on vehicles than he was expecting.

Lei revealed that the electric vehicle manufacturing plant has received more than 20,000 resumes and has recruited a 453-person strong research arm. Lei said that Xiaomi's electric vehicle business has, at the present stage, no plans for an IPO.

Apple iPhone assembler Foxconn Group has also announced its plan to develop electric vehicles, and last month it unveiled three new models - an SUV, a sedan and a bus - which are being produced by Foxtron, a joint venture between Hon Hai and Taiwan Yulon Motor Co.

CNBC reported in September that Alibaba has made investments worth more than $300 million into Chinese autonomous driving start-up

The Shenzhen-based start-up makes self-driving systems for vehicles that include hardware and software. runs a fleet of autonomous taxis with some operated by its partners including ride-hailing firm CaoCao and automaker Dongfeng Motors. But the company is also developing technology for logistics.

Chinese tech giant Huawei Technologies Co has said it will not build its own cars but that it is helping auto companies with new energy projects.

It has launched a series of intelligent car components and solutions including a 4D imaging radar, another foray into the vehicle sector that analysts said could help it offset the impact of the US' suppression of its mobile business.

Wang Jun, president of Huawei's Intelligent Automotive Solution (IAS) Business Unit has said that Huawei will invest $1 billion in developing intelligent vehicle solutions this year, and that it has a global research team with more than 5,000 technicians and engineers.

Market watchers said unlike the rising domestic NEV players such as NIO, XPeng and Li Auto, known as the "new force," the established tech giants have their own advantages, such as brand recognition.

Baidu has already spent years on autonomous driving research and development. The company has expanded its safe road test mileage from 6 million kilometers to 18 million kilometers, a major milestone in its development of autonomous technology.

On October 12, data from the China Association of Automobile Manufacturers showed that from January to September, the total sales of "new force" companies reached 598,000, a year-on-year increase of 249.3 percent.

Market watchers said that in 2016, there was a wave of internet giants evaluating the auto industry in China, but more of them were focused on empowering the auto industry through AI, big data, and cloud computing technologies. This round is different, and many technology giants are no longer willing to act in a supporting role, which will have an important impact on the pattern of the auto industry.

The domestic market of new-energy vehicles (NEVs) has been continuously expanding, with the production and sales of NEVs in China reaching more than 350,000 units and hitting a record high in September, while the penetration rate from January to September has risen to 11.6 percent, according to data released by China Association of Automobile Manufacturers.

Tech giants are not the only ones eyeing expansion into the segment, Chinese property giant Evergrande is also seeking a transition from property toward NEVs within 10 years as part of the indebted developer's business transformation plan.

Evergrande's electric car Hengchi 5 has entered its trial production stage, the final step before entering mass production, domestic news outlet reported on Monday.

Liu Yongzhuo, the president of Evergrande New Energy Vehicle, said in October that the group would achieve its goal of delivering the first Hengchi-branded car earlier in 2022, as the company has commenced a three-month campaign to ensure that its first car rolls off the production line at its Tianjin plant.