BYD, a Chinese electric vehicle (EV) manufacturer backed by Warren Buffett, is joining forces with technology giant Huawei to integrate Huawei’s advanced autonomous driving system into BYD’s off-road ‘Fangchengbao’ EVs. This strategic partnership marks a significant move for BYD, seeking to enhance its premium offerings and drive sales in the high-end market.
The agreement between BYD and Huawei will see the implementation of Huawei’s Qiankun intelligent driving system in BYD’s ‘Fangchengbao’ off-road EVs. The Bao 8 SUV, part of the ‘Fangchengbao’ lineup, will be the first BYD model to feature this technology, with an expected release later this year. BYD aims to elevate its premium brands, including ‘Denza,’ ‘Fangchengbao,’ and ‘Yangwang,’ which currently account for a mere 5% of its total sales in the first half of 2024, according to data from the China Association of Automobile Manufacturers.
Despite being a dominant force in the EV market and enjoying a cost advantage due to its vertical integration strategy, BYD has traditionally relied on external suppliers for intelligent features in its high-end models. This partnership with Huawei signifies a shift in strategy, aiming to equip its premium vehicles with cutting-edge autonomous driving capabilities.
The collaboration comes on the heels of BYD’s recent initiatives to bolster its smart driving technology. In July 2024, BYD recruited Zhou Peng, a former executive from Baidu Inc., to spearhead the development of driver assistance technology. Additionally, in December 2023, BYD secured a conditional testing license for level 3 autonomous driving on high-speed roads.
However, the partnership faces potential hurdles due to international regulations. The U.S. Commerce Department is currently considering a proposal to ban Chinese software in autonomous and connected vehicles. This could impact the testing of autonomous vehicles produced by Chinese companies on U.S. roads.
Despite Berkshire Hathaway, led by Warren Buffett, gradually reducing its stake in BYD, BYD remains a dominant force in the Chinese automotive market. In fact, Chinese automakers have surpassed their U.S. counterparts in sales for the first time, solidifying China’s position as a leader in the automotive industry.
