China’s Huawei Technologies is in talks to take control of an electric vehicle division owned by a small Chinese automaker. Reuters learned about this from two informants who were directly familiar with the issue. According to the agency, the desire to complete the transaction indicates a change in the strategy of the company, known as the world’s largest manufacturer of telecommunications equipment.
Whistleblowers said Huawei, hit by US sanctions, is in talks with Chongqing Sokon to acquire a controlling stake in Chongqing Jinkang New Energy Automobile. They added that the move will allow Huawei to produce smart cars under its own brand. Jinkang counts as its main asset the American electric vehicle brand Seres, formerly known as SF Motors. The source adds that for several months, Huawei has been actively involved in the work of Sokon and its unprofitable Seres division.
The deal could be the first proof that Huawei is committed to a full presence in the growing industry.
Sales of new energy vehicles (which include battery electric vehicles, plug-in hybrid vehicles and hydrogen fuel cell vehicles) are expected to account for 20% of sales in China by 2025.
Huawei and Sokon did not respond to requests for comment from Reuters.
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