(Report producer/author: Soochow Securities, Huang Xiaoli)
1. Evaluate Huawei's "car-making" competitiveness from the perspective of vehicle framework
Excellent capabilities such as channel/brand/product definition
In terms of intelligence, Huawei adheres to the strategy of platform + ecosystem, establishes full-stack intelligent solutions, and is at the leading level in the industry. Huawei's own soft power such as channel + brand power + marketing is also leading, and years of terminal business accumulation have given Huawei unique advantages in consumer insight and product definition, and Huawei's comprehensive strength is excellent from the perspective of the whole vehicle.
Intelligent - leading technology, intelligent driving progress beyond expectations
Landing progress: It has landed in 5 cities, and the future planning is at the forefront of the industry. Urban scenes are the most frequent car use scenarios for users, and the implementation of assisted driving functions in urban scenes will significantly improve the user experience. In terms of progress, Huawei's urban intelligent driving has landed in five cities, Shanghai, Guangzhou, Shenzhen, Chongqing, and Hangzhou, as well as some urban areas in Beijing, and the first model equipped is the M5 intelligent driving version. According to the plan, Huawei expects to open NCA (originally planned to be 45 cities) in urban areas that do not rely on high-precision maps nationwide in December 2023, which is progressing beyond expectations.
Huawei continues to iterate and upgrade its experience in terms of intelligent cockpit. 1) Vehicle system: In August 2023, Huawei released HarmonyOS 4.0, and the first pure electric coupe of Huawei's smart car business will be equipped with HarmonyOS 4. 2) Automotive hardware: The HUAWEI SOU ND car audio system creates an intelligent sound field, creating sound field control technology and independent multi-zone experience. HUAWEI car smart screen image quality + response speed is excellent. 3) Voice assistant: Smart assistant Xiaoyi has been connected to the AI large model capability to improve the intelligent experience through the blessing of the underlying technology of the Pangu large model.
Organizational structure – The structure is constantly adjusted and gradually moving towards stability
After three adjustments of the ICT department management (Xu Zhijun) → terminal BG management (Yu Chengdong), the car BU has been adjusted independently of →the terminal BG (Yu Chengdong) three times; The smart selection service is managed by the terminal BG (Yu Chengdong). 2019: In May, Huawei officially established the Automotive BU, which is under the management of the ICT department, with Xu Zhijun as the highest person in charge and Wang Jun as the president of the vehicle BU, forming five product divisions: intelligent driving, intelligent cockpit, intelligent networking, intelligent electric, and intelligent vehicle cloud. 2020: CheBU is divided into Consumer BG, under the management of Consumer Business Management Committee (Yu Chengdong), and the president of CheBU is still Wang Jun. 2021: Terminal BG (formerly Consumer BG) is responsible for the smart selection business, and Yu Chengdong is in charge. From the perspective of organizational structure, the smart selection model and the HI model are parallel in China and are gradually moving towards stability.
Channels - extensive layout, store efficiency improvement can be expected
Huawei's terminal business channel layout: By the end of 2022, Huawei had established more than 60,000 stores and counters around the world, including more than 5,500 experience stores and more than 2,200 Huawei authorized service centers. At the same time, Huawei continues to build large-scale flagship stores and smart life pavilions in core cities around the world that support high-end experiences, providing immersive, full-scenario experiences that connect people, vehicles, and homes, and serving local communities. By the end of 2022, Huawei has 14 flagship stores worldwide and more than 300 smart life halls over 500 square meters worldwide. Leading number of existing automobile sales channels: At present, the channel types include user centers, Huawei authorized experience stores, Huawei intelligent life halls, and Huawei flagship stores. As of September 27, 2023, there were 884 stores. These include 214 user centers + 335 Huawei Smart Life Pavilions + 8 Huawei flagship stores + 327 Huawei authorized experience stores. Compared with the new force brands Xpeng/Lili/NIO, the number of stores is 530, 346/420 respectively, and the channel layout is extensive, covering the core business district of the city and many long-tail cities. Standardized channel management and expected store efficiency: In July 2023, Cialis Automotive and Huawei jointly decided to establish the "AITO Joint Working Group on Boundary Sales and Services", which will be fully responsible for the end-to-end closed-loop management of marketing, sales, delivery, service, and channel from July 1, improve the management of sales, channels, and services, and improve customer experience.
Marketing - has a wide user base and a mature marketing system
Huawei has a broad user base and is uniquely positioned in consumer insights, consumer demand forecasting, product definition, process management, and sales and marketing channels. Huawei's C-end user resources are huge, and HUAWEI Mall's rich product line, including mobile phones, provides the largest entrance to model exposure, and ecological products complement each other. Unlike the peripheral products provided in the new force brand APP, Huawei models have joined and improved the Huawei ecological chain, rather than building an ecological chain centered on the model, and the online supporting systems such as the Huawei Mall membership system, points system, enterprise purchase, WeChat mini program, IOS APP, Baidu mini program, Douyin mini program, and bank cooperation store have many years of operation foundation, and the drainage function is significant under the wide user base.
Vehicle manufacturing – M9 opens new platform
The M9 is based on a new vehicle platform and opens a new cycle of platform technology. The M9 is positioned as a panoramic smart flagship SUV equipped with an all-aluminum alloy chassis, air springs and CDC damping system as standard on all models. Available in extended-range and pure electric versions, it will be officially released in December. Size: length * width * height = 5230 * 1999 * 1800, wheelbase 3110mm. Internal space: flat floor, three rows of steps in and out, larger longitudinal adjustment space; Flexible layout changes, 3/4/5/6-seat mode variable. Appearance: double reflective lens digital projection headlights, starlight digital matrix interactive system, ADB/AFS headlights. Intelligent cockpit: 10 screens fully equipped; HarmonyOS 4 cockpit; Equipped with AI large models, it realizes visual interaction of in-vehicle artificial intelligence emotions.
2. Huawei-car company friend circle and industry chain combing
Huawei & Cialis: The depth of cooperation continues to deepen
Huawei + Cialis cooperation has been gradually deepened, and cooperation has been deepened in various channels and models. Cialis is the first car company to adopt the smart model cooperation model, and the models currently on sale include the M5/M7. In February 2023, Cialis and Huawei signed a cooperation deepening agreement to set a joint business target of 1 million new energy vehicle production and sales by 2026. In terms of channels: In July 2023, Cialis and Huawei established the "AITO Joint Working Group on Boundary Sales and Services", which is fully responsible for end-to-end closed-loop management of marketing, sales, delivery, services, and channels, and achieves channel-side efficiency. New models: The new M7 was announced in September 2023; The flagship M9 SUV will be available in December 2023.
The new M7 has increased the investment by 500 million yuan as a whole, and the core upgrade points are intelligent driving upgrade (ADS 2.0) + cockpit interconnection/comfort improvement (new maglink interface, but not upgraded to Harmony 4.0; seat comfort improvement) + space optimization (providing a large five-seat version) + safety improvement. Smart Driving & Intelligent Cockpit: The new M7 Max version is equipped with ADS 2.0, and the hardware adds 3 cameras + 1 overhead lidar, and the company expects to open NCA in urban areas nationwide in December 2023 (originally planned to open 45 cities by the end of the year). In addition, the new M7 has a visible parking capability, supporting valet parking and ultra-narrow parking in the park. The smoothness of the Hongmeng intelligent cockpit continues to improve, and the efficiency of terminal application circulation is improved. The rear row is equipped with HUAWEI MagLink interface as standard, and the optional on-board smart screen can realize multi-device linkage. Interior space: a new five-seat version is added, and the seat comfort + trunk depth are increased at the same time to meet the loading needs of family cars; The six-seat version has a more flexible layout and gives users more choices. Active and passive safety: Body stiffness and collision safety are improved, and the AEB maximum braking speed is increased to 90km/h with the first omnidirectional collision avoidance system. Comfort features: the new "Marshmallow" seats are standard with the big five-seater, and the ventilation, heating and massage functions of the four seats are standard; Enjoy six seats with new zero-gravity seats.
Huawei and Chery cooperation and industry chain combing
Cooperation history: On December 16, 2020, Huawei and Chery signed a comprehensive cooperation framework agreement to carry out in-depth cooperation in cloud computing, big data, and intelligent vehicle solutions. In September 2022, Chery announced the smart electric vehicle brand plan cooperated between Huawei Smart Car and Chery at the "Yaoguang 2025 Chery Technology DAY" theme event, which will be built based on the platform codenamed EOX, and has planned 5 high-end smart electric vehicle models. New car planning: According to the new car announcement of the Ministry of Industry and Information Technology on August 17, 2023, the first model is named Zhijie S7, the energy type is pure electric, the length*width*height is 4971*1963*1477mm, and the wheelbase is 2950mm. The model is scheduled to go on sale in November.
Huawei & Changan: Cooperation continues to deepen
Deep Blue: On August 16, 2023, Deep Blue Auto and Huawei officially signed a cooperation framework agreement at the Bantian Base of Huawei's global headquarters in Shenzhen, focusing on continuous cooperation in the field of automotive intelligence. Avita: The strategic cooperation between Avita Technology and Huawei has been deepening. In August 2022, Avita 11, the first brand with HI Huawei's full-stack intelligent vehicle solution as standard, was launched, and delivery officially began in December. In September 2023, Avita 12 was officially unveiled, equipped with Huawei's latest ADS 2.0 intelligent driving assistance system, and the vehicle machine adopts HarmonyOS 4.0, which will be delivered in 2023Q4. Profit forecast: The net profit attributable to the parent in 2023-2025 is expected to be 89.96/81.73/9.788 billion yuan, respectively, and the current market value (September 28, 2023) corresponds to 23/24/25 PE of 13/14/12 times respectively.
Progress of cooperation between Huawei and BAIC
Beiqi Extreme Fox was upgraded from HI mode to smart selection mode. Beiqi Extreme Fox is the earliest car company to cooperate with Huawei, and its cooperation model with Huawei was upgraded from Huawei Inside mode to smart car mode in April 2023, and it is expected to jointly develop a new model. In November 2018, Extreme Fox Motors and Huawei signed a framework agreement to deepen strategic cooperation, under which the two parties will conduct in-depth research and cooperation in intelligent transformation and deeply integrate ICT technology with intelligent connected vehicles. In October 2020, the Alpha T was officially launched and mass-produced with Huawei's intelligent network and intelligent electric technologies. In April 2021, the new HI version of the Alpha S was officially released, which is the first mass-produced full-stack intelligent vehicle solution equipped with Huawei, which was officially launched in May 2022 and started delivery in June. On April 16, 2023, Huawei and BAIC Extreme Fox upgraded from HI mode to smart selection mode.
BAIC has reserved production capacity for models under smart selection mode. In order to meet the design and production needs of new models, the company will upgrade the existing BE22 platform in an all-round way to create a new generation of high-end pure electric intelligent networked vehicle platform for BAIC New Energy, and the upgraded BE22 platform products will be produced by Beijing high-end intelligent ecological factory. On August 15, 2023, BAIC Blue Valley announced the purchase of equipment assets of Foton Motor's Miyun plant, a related party, the implementation of technical transformation of production lines, and leased the land and ancillary facilities of the Miyun plant to form an annual production capacity of 50,000 high-end new energy vehicles.
Excerpts from the report:
(This article is for informational purposes only and does not represent any investment advice from us.) For information, please refer to the original report. ）
Selected report source: [Future Think Tank]. 「Link」