Huawei, the Chinese tech giant known for its smartphones and telecom equipment, has entered the electric vehicle (EV) market with a bang. The company has launched its first sedan, the Luxeed S7, which is designed to compete with Tesla’s Model S in terms of performance, range, and price.
The Luxeed S7 is a joint product of Huawei and Chery, a Chinese automaker. It has a starting price of 258,000 yuan ($35,400) during the presales period, which is much lower than the Model S, which costs 698,900 yuan ($95,800) in China. The Luxeed S7 also boasts a powerful high-voltage battery pack, made by Chinese EV battery giant CATL, that can deliver a driving range of 400 kilometers (249 miles) after a 15-minute charge. This surpasses the Model S, which has a range of 347 kilometers (216 miles) after a similar charging period.
Richard Yu, the chief executive of Huawei’s consumer business group, unveiled the Luxeed S7 at a press conference in Shenzhen on Thursday, saying that it exceeded the Model S “in every specification”. He also claimed that the Luxeed S7 had a quieter cabin, a more luxurious in-car experience, and a better performance on rough roads than the Tesla model.
Huawei expands its vehicle portfolio amid US sanctions
Huawei’s entry into the EV market is part of its strategy to diversify its business amid the US sanctions that have crippled its core operations. The US government has accused Huawei of posing a national security threat and has imposed export restrictions that have cut off its access to key components and software. As a result, Huawei’s smartphone sales have plummeted and its 5G network equipment has faced bans in many countries.
To cope with the challenges, Huawei has shifted its focus to other areas, such as cloud computing, smart devices, and EVs. The company has partnered with several Chinese automakers, such as BAIC, GAC, and Seres, to provide its software and hardware solutions for their vehicles. Huawei has also launched its own brand of vehicles, called Aito, which includes two plug-in hybrid crossovers and a full-electric SUV.
Huawei’s automotive push has been met with success, as the company has delivered more than 39,000 vehicles as of August this year, according to local media reports. The company has also received more than 30,000 pre-orders for the Luxeed S7 in just four hours after its announcement.
Huawei faces fierce competition in China’s EV market
While Huawei has made impressive progress in the EV market, it still faces fierce competition from both domestic and foreign rivals. China is the world’s largest EV market, with more than 1.8 million EVs sold in 2020, according to the China Association of Automobile Manufacturers. The market is expected to grow further, as the Chinese government has set a target of having 20% of new car sales to be EVs by 2025.
However, the market is also crowded with many players, ranging from established automakers, such as BYD, SAIC, and Geely, to new entrants, such as Nio, Li Auto, and Xpeng. These companies have been investing heavily in innovation, design, and marketing to attract customers and gain market share. Tesla, the US EV leader, has also been expanding its presence in China, with its Shanghai Gigafactory producing the Model 3 and Model Y for the local market.
Huawei will have to differentiate itself from the competition by leveraging its strengths in technology, software, and branding. The company has said that it aims to provide a “smart car experience” for its customers, with features such as voice control, facial recognition, and autonomous driving. Huawei has also said that it plans to launch more models in the future, including a sports car and a luxury car.