Verbal jabs at China EV 100 Forum reflect complex atmosphere among carmakers

Staff reporter, Taipei; Peng Chen, DIGITIMES Asia 0

Credit: AFP

Chinese automotive executives hurled jabs at each other during the recent EV Forum.

Held in Beijing, Huawei's Richard Yu, Xpeng's founder He Xiaopeng, Nio's founder William Li, and other automotive executives attended the China EV 100 Forum. Their remarks reflected the intricate relationships among Chinese carmakers, who compete and collaborate simultaneously.

In his speech at the forum, He said elimination in China's EV sector has begun. Xpeng will focus on smart driving technology in the next 10 years.

He also said the company would be the first among competitors to put a large technology model into its vehicles in the second quarter of this year. For 2024, Xpeng plans to invest CNY3.5 billion (US$486.17 million) in smart technology.

Huawei has become a significant smart driving technology developer with its Zhixuan model, which secures partnerships with carmakers. After He's speech, Richard Yu, chairman of Huawei's Intelligent Automotive Solutions (IAS), "provoked" the Xpeng founder by saying that while Xpeng has been viewed as a leader in smart car technology, Huawei is poised to change the perception shortly. Yu said Huawei offers the best experience in cockpit and smart driving technology recognized by the industry.

Huawei and Xpeng have taken opposite approaches. Xpeng has expanded its product portfolio to EVs priced between CNY100,000 and CNY150,000.

The M7, an EV Huawei developed with Seres, targets the CNY300,000 market. The vehicle Huawei built with Chery Automobile, the S7, is also a mid-to-high-end model.

The verbal jabs between Huawei and Xpeng reflected the different business strategies they take and the industry's intense competition under the table. Chinese automakers must choose between lowering vehicle costs and prices and focusing on high-end models to secure profits.

Comprehensive supply chain control will be critical

William Li, Nio's founder, chairman and CEO, said at the forum that in the next eight years, about 19.4 million EVs will face the issue of battery maintenance costs. If each EV needs CNY60,000 to replace its battery, the after-sale market will be valued at over CNY1 trillion. The situation will affect the business model of EV batteries.

According to Li, BYD and Nio are the only automotive OEMs in China that operate battery labs. Nio aims to develop long-life batteries that can last for 15 years.

Li Yunfei, general manager of branding and public relations at BYD, said before 2022, EVs were more expensive than gasoline cars. BYD rolled out EVs with the same price level as gasoline cars in 2023 and those with lower prices in 2024.

Li said BYD was able to reduce prices because the company has covered from the upstream, including batteries and electric motors, to the downstream, such as insurance and direct selling of some EVs.

Gu Huinan, general manager of GAC Aion, said opportunities remain as market competition continues to heat up. Chinese carmakers will be able to scale inside and outside China due to the fierce rivalry.

Gu also said no high-end EV brand has secured its position except for Tesla. Premium automakers still need more time to solidify their market.