Recent reports have indicated that Volkswagen is in talks with Chinese telecoms and electronics giant Huawei regarding the acquisition of an autonomous driving unit for billions of euros. The negotiations have been going on for several months now regarding technical systems that Volkswagen has not yet mastered. One Volkswagen spokesperson declined to comment, while Huawei had not responded as of 3 p.m. on Tuesday.
A person familiar with the matter told Jiemian News that the two sides are indeed negotiating. The cooperation would likely involve a joint venture between the two companies, funded and controlled by Volkswagen while Huawei provides technology and becomes a tier-one supplier of Volkswagen. “It is like Huawei is selling its autonomous driving business to Volkswagen, and the price may be about 10 billion yuan ($1.58 billion),” said the above-mentioned person, although the specific amount is still under discussion.
In January this year, Stephan Wöllenstein, CEO of Volkswagen Group China, unveiled that his firm and Huawei were indeed engaged in negotiations, but that there was no confirmable news at this stage, including the establishment of a joint venture between the two parties. Soon after, Volkswagen CEO Herbert Diess said on February 17 that he expected the automotive industry to popularize autonomous driving technology within 25 years, and the company was seeking to establish new partnerships to improve its self-sufficiency in the software field.
There are increasing signs that some progress has been made in the negotiations between the two companies. The above-mentioned insider also said that Su Jing, the former head of Huawei’s smart driving product division who left in January this year, will join the joint venture company as the product leader.
According to Yicai, many employees of Huawei’s autonomous driving product division have received “internal transfer interviews.”
In addition, in July last year, Huawei and Volkswagen jointly released a full-stack integrated simulation platform, which is the first large-scale application of similar solutions in China’s automobile industry.
However, Huawei is not the only supplier of autonomous driving solutions for the Volkswagen cooperation. Earlier, the CEO of Volkswagen China revealed that it was cooperating with DJI on autonomous driving mass production. In January this year, Cariad, a software subsidiary of Volkswagen Group, reached a partnership with Bosch, and both parties will jointly develop automatic driving software for Volkswagen passenger cars.
Volkswagen is also building a major new factory for its flagship pure electric car, the Trinity, which is expected to begin mass production in 2026.