A host of Chinese automakers have been forced to halt deliveries of several flagship models because of production issues with a computing unit made by tech giant Huawei.
Changan Auto and Chery Auto – both of which have partnered with Huawei in developing their premium electric vehicle (EV) brands – have lodged complaints and are in talks to resolve the issue, sources said. Seres, a smaller carmaker, has also been affected.
The computing unit, called the MDC 810, powers advanced driver assistance systems and is central to Huawei’s ambitions to become the dominant supplier of software and components for smart electric vehicles.
The production issue relates to a shortage of a component that goes in the MDC 810, according to one of the sources.
The MDC 810 allows the automakers to offer so-called intelligent driving features that include autonomous driving on highways and helping drivers navigate traffic jams, similar to what Tesla’s Autopilot provides in North America.
In China, the world’s biggest auto market, where hundreds of EV and gasoline-hybrid hybrid vehicles are competing for consumer attention, such features have become a major selling point and are a key reason why automakers have sought to partner with Huawei, analysts have said.
The problems come at a time when Huawei is seeking to secure more investors for its four-year-old Intelligent Automotive Solution (IAS) business unit that it plans to spin off. Changan Auto has said it plans to own up to 40% of the new company.
Changan’s Avatr 12 sedan had orders of more than 20,000 as of December 1, according to the company.
Auto Firms’ Compensation Pledges
Avatr Vice President Li Pengcheng at an event last week cited “challenges in key component supplies” as a factor in delivery delays of two weeks on average, without naming Huawei. Avatr said it plans to compensate buyers for the late deliveries.
Chery’s Luxeed S7 sedan – the first model for its Luxeed brand – had orders of about 20,000 as of November 28.
The brand was only recently launched in November and had been much hyped by Huawei with Executive Director Richard Yu claiming the S7 would beat Tesla’s luxury Model S in performance and at a price lower than the Model 3.
Seres, which launched its Aito M9 SUV in December, had been expected to deliver its first batch of 2,000 vehicles by January 26 to buyers but has missed this target, said one person with direct knowledge of the matter.
BAIC ARCFOX’s Alpha S sedan, launched in 2021, also uses the MDC 810. Two people said that short supplies of the MDC 810 had affected production of the Alpha S in the past.
- Reuters with additional editing by Sean O’Meara