Huawei sees heavy early demand for its smart cars
Remember Huawei's emphatic denials that it's absolutely not going to make cars?
It's true. Huawei is not making cars – it's selling them.
It began taking orders in April for the Seres SF5, an electric vehicle made by a little-known motorcycle and component manufacturer, Chongqing Jinkang, from China's southwest.
In a demonstration of the power of the Huawei brand, it received 3,000 orders in the first two days – more than last year's entire sales tally.
Neither company has issued any definitive sales figures, although one media report claims 10,000 have been sold in the first month, while another said 6,000 shipped in the first two weeks.
But early demand is way ahead of supply. New buyers need to wait three months to take delivery, Sina Tech reported.
Huawei has set an ambitious target of 300,000 units shipped by the end of 2022, Sina said. That would put it way past Tesla, the market leader last year, with 137,000 Tesla 3s sold.
The high-profile issues are helping drive customers to Huawei stores, according to a store clerk at Huawei's flagship retail outlet on Shanghai's Nanjing East Road.
A reporter who visited the Huawei store observed a steady stream of traffic – in just half an hour 20 visitors inquired about the Seres or booked a test drive.
Currently Huawei is selling a 4WD drive Seres, with a 2WD drive version on its way.
It pockets a 10% commission on each sale. With the 4WD selling at 246,800 yuan (US$38,762), even if Huawei achieves just a third of its 2022 target, that's still nearly $400 million in new revenue.
The SF5 comes with a Huawei-built electric drive system, with a range of 180 km on pure electric. It also has Huawei's HiCar solution that allows users to switch between their mobile phone applications and the vehicle control panel.
The shift to smart car sales is one of a number of moves Huawei has made as it faces the loss of its handset business under the weight of US sanctions.
Its high-tech brand and retail store network, as well as the need to promote its own auto solutions, make it a strong channel partner.
Announcing the deal on April 19, Huawei consumer unit CEO Richard Yu hinted that the company might sell other smart car brands as well.
"In the future, we will not only provide leading smart car solutions to help partners build better intelligent vehicles, but also help them sell those vehicles through our retail network across China," he said.
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— Robert Clark, contributing editor, special to Light Reading