Huawei fully elaborates on its automotive strategy for the first time: We don’t build cars, but we want to create 70% new value

Rumors that Huawei is going to make self-driving cars have frequently appeared in the media and industry insiders in recent years. Indeed, with the rapid development of 5G and AI, it is hard to imagine that this company will not join the wave of subverting travel methods. Today at the Shanghai International Auto Show, Huawei's rotating CEO Xu Zhijun disclosed Huawei's intelligent driving plan to us for the first time.

　　"We don't build cars, but we will help our customers build better cars through ICT technology," said Huawei's rotating chairman Xu Zhijun in his speech this morning.

　　Today is the second day of the Shanghai Auto Show. As an outsider in the automotive industry, Xu Zhijun's speech answered many questions we have always had, becoming a highlight of the auto show. Xu Zhijun detailed Huawei's overall layout in the automotive field, fully answered how Huawei will invest in smart driving, and also made his own outlook on future travel methods.

　　Lane change and overtaking

　　Huawei believes that the future automotive industry will have a lot of integration with technology companies. The ICT industry and the automotive industry where Huawei is located have always been considered to be two completely independent industries. However, Huawei believes that the two companies have actually been striving for the same goal: freedom of action and communication. The recent rapid development of electric vehicles is an opportunity for domestic automakers.

　　"We are all talking about smart connected cars. I prefer to add the word electric here. This is an opportunity for China's automobile industry to take off." Xu Zhijun said, "Smart connected electric vehicles are an opportunity for the Chinese automobile industry to 'change lanes and overtake'. There will be a lot of integration between the ICT industry and the automobile industry, and we will definitely meet often in the future. Huawei hopes to use its more than 30 years of technological accumulation to promote the progress of the automobile industry."

　　Huawei is using its technology to help automakers develop self-driving cars. Earlier this year, BAIC New Energy and Huawei signed a comprehensive business cooperation agreement and jointly established the "1873 Davidson Innovation Laboratory" to jointly develop the next generation of intelligent connected electric vehicle technology.

　　In December last year, the Ministry of Industry and Information Technology issued the "Action Plan for the Development of the Internet of Vehicles (Intelligent Connected Vehicles) Industry", which proposed that by 2020, my country will achieve breakthroughs in the cross-industry integration of the Internet of Vehicles (Intelligent Connected Vehicles) industry, and intelligent connected vehicles with high-level autonomous driving functions will be applied on a large scale in specific scenarios. The penetration rate of Internet of Vehicles users will reach more than 30%, and the level of intelligent road infrastructure will be significantly improved.

　　According to industry forecasts, the domestic market size of intelligent connected vehicles will reach 100 billion yuan by 2020. Faced with this huge market "cake", not only are major car companies and Internet companies scrambling to make layouts, but many cities in China are also scrambling to seize new positions in intelligent vehicles.

　　The third living space

　　Intelligent driving will not only make people's travel more convenient and traffic more efficient, but will also increase everyone's daily time in disguise. In Huawei's eyes, autonomous driving will become the next direction of human life change after mobile Internet.

　　"Before the iPhone, mobile phones were just a tool for making calls. The development of smartphones has brought about tremendous changes in the value and space of the mobile communications industry," said Xu Zhijun. "In the future, smart connected electric vehicles will also be a process of transformation from feature phones to smartphones. They are connected to the network and the experience is improved through continuous software and hardware upgrades. For the players in the industry, the market space and value it brings will be very different. In the future, there will be connections between car providers and consumers, and connections will bring value."

　　Huawei believes that intelligent driving can elevate human freedom to a new level. Autonomous driving will free up people's travel time, and in the future, cars will become the third living space besides home and office. This change will bring many new opportunities.

　　A report from McKinsey predicted that by 2040, 55% of domestic passenger mileage will be provided by electric vehicles, self-driving cars and shared cars. Currently, there are 266,000 charging stations on major highways in China, which is 43% more than Europe and the United States combined. Xu Zhijun believes that smart connected electric vehicles will become a new revolutionary development engine for human society, and its impact will far exceed the two industries of automobile and technology themselves.

　　Smart connected cars will become a platform for continuous value creation, and Huawei hopes to play an important role in it.

　　70% incremental value

　　Although Huawei is still a newcomer in the automotive industry, it has taken a leading position in new technologies applied to intelligent driving. Huawei hopes to become an incremental service provider for intelligent connected vehicles. The value of future cars will not be limited to engines, chassis and gearboxes, but will also include intelligent computing systems and vehicle-road collaboration technologies.

　　"70% of the value of future cars will not be in the traditional body and chassis, but in the autonomous driving software, computing and connectivity technologies," Xu Zhijun said. "For autonomous cars, most of the money you pay will be spent on the newly added related parts. The form of future cars will change dramatically, so we will not choose to build cars."

　　如果正如很多人所说的，未来的汽车将会是一台计算机的话，华为已经可以提供计算机的「心脏」了。目前华为与奥迪的 L4 自动驾驶技术开发就是基于去年刚刚推出的昇腾 310 芯片。

　　Huawei MDC600 in-vehicle data center installed in Audi Q7. The module has a computing power of up to 352TOPS and supports L4-level autonomous driving computing.

　　Although Huawei does not manufacture cars, it still hopes to be the absolute leader in the areas it excels in, including vehicle-road collaboration and artificial intelligence/autonomous driving. In Huawei's vision, the computing chips in cars will be reduced from the current more than 100 to three, which will be used to control intelligent driving, intelligent cockpit + entertainment functions, and power. Huawei has proposed the concept of Mobile PC for this purpose.

　　Huawei hopes that the wiring inside cars in the future can be greatly simplified, while computing power can also be concentrated.

　　"There are many new forces in the car industry, and they mainly want to use software capabilities to develop autonomous driving, but the cost of chips is very high," said Xu Zhijun. "Huawei's artificial intelligence chips can solve the computing power needs in the development of smart driving cars. We have also released the 'Octopus' cloud-based autonomous driving service, which includes computing power, models, training, simulated driving tests and other services. It can help customers develop their own smart driving technology more conveniently."

　　Digital solutions proposed by Huawei.

　　In terms of the research and development of new technologies, Xu Zhijun said that Huawei is researching L4 autonomous driving. Before cars become intelligent entities that can think and drive completely autonomously, we still need the help of technologies such as vehicle-road collaboration.

　　At present, Huawei has established an automotive industry solutions department. Since the technology behind intelligent driving comes from different departments of Huawei, the resources allocated to the new department will vary according to different customer needs.

　　"It takes us 18 months to make a mobile phone, while it takes car companies two to three years to launch a new car. What we are doing today will not generate returns until after 2021," said Xu Zhijun.

　　The biennial Shanghai Auto Show has become a weathervane for leading technology. In April 2015, Alibaba released its automotive strategy at the Shanghai Auto Show; in April 2017, Baidu released its Apollo plan; on April 17, 2019, Huawei released its own automotive strategy at the Shanghai Auto Show. Although Huawei's entry is not "car manufacturing", it may bring more in-depth changes to this industry.