According to an industry expert, China’s tech companies could significantly transform the market for electric cars in the coming years. “It looks as if we are witnessing the biggest transformation in the industry,” wrote industry expert Ferdinand Dudenhöffer in a recent study of the world’s largest car market, China. The focus is on companies like Huawei and Xiaomi, which are known to many in Germany as manufacturers of smartphones.
According to Dudenhöffer, the tech companies develop vehicles with the car manufacturers and supply the software that is crucial in the so-called intelligent cars. As examples, he cited Xiaomi’s SU7 sedan and the Avatr electric car brand, which Huawei built with battery manufacturer CATL and other companies. “The SU7 is not produced by Xiaomi itself, but assembled by the Chinese car manufacturer BAIC,” wrote Dudenhöffer. Huawei supplies its Harmony operating system and thus, for example, the voice control in the Avatr cars.
Expert: Reversal of roles in the auto industry
The car expert expects a kind of reversal of roles in the car industry. The majority of today’s car companies only assemble cars and become suppliers for the tech giants, he explained. These in turn provided the ecosystem and intelligence for the car. “Bending sheet metal becomes boring,” wrote Dudenhöffer.
China is the world’s most important market for electric cars and is therefore highly competitive. The Chinese car manufacturer BYD and the US company Tesla are in a neck-and-neck race for customers. German car manufacturers are far behind. In the fourth quarter of 2023, the southern Chinese overtook Tesla boss Elon Musk’s brand for the first time in terms of sales figures. “BYD will replace Toyota in around ten years,” expects Dudenhöffer. The Japanese company is currently the largest car manufacturer in the world.
