Chinese automaker Geely unveils the first model of its new Lynk & Co brand in Berlin.
Ulstein Build Dtl. | Ulstein build | Getty Images
BEIJING – Companies from Nvidia Huawei is chasing the automotive technology market as the electric vehicle industry booms and Ecarx is emerging as a new contender.
Since 2017, the founder and chairman of the Chinese automobile conglomerate Geely, Eric Lee, has been involved in construction Ekarks which provides software and chip systems for digital vehicle cockpits and driver assistance systems.
The company said Wednesday that its fourth-quarter revenue rose 22% from a year earlier to $263 million. Geely’s auto brands such as Lynk and Co accounted for 70% of that revenue.
During the same quarter, Nvidia reported that auto revenue fell 4% year over year to $281 million, despite CEO Jensen Huang calling the segment the company’s “next billion-dollar business.”
Nvidia counts Geely’s premium electric vehicle brand Zeekr as a buyer for its Drive Orin chip, which uses artificial intelligence to enhance driver-assistance features known as “system on a chip.” Li Auto, BYD’s Denza brand and Xiaomi are among Nvidia’s other automotive clients.
Ecarx co-founder and CEO Ziyu Shen told CNBC this week that Nvidia has the advantage when it comes to AI-powered self-driving systems.
“We can’t compete with them in this area,” he said, but noted that about 70-80% of the auto market still doesn’t need such advanced technology and can buy simpler, safety-focused driver assistance systems. .
“Security will be a very important starting point for us,” he said in Chinese, translated by CNBC.
Ecarx sells its own Antora 1000 system-on-a-chip, which is used by Lynk and Co.
Shen said his company’s current products compete directly with Qualcomm’s Snapdragon chips and that new offerings will announced on March 20, will be on the same level as Nvidia’s Orin X.
So, despite recognizing Nvidia’s current dominance in AI technology, Shen is looking at different ways to capture a larger share of the auto market.
Geopolitical advantage?
Ecarx plans to benefit from sales to local Chinese companies that need to buy products from domestic firms for geopolitical reasons, Shen said, adding that the company works with almost all major automakers except BYD in China.
He expects the overseas market will also be a growing business for the company and give it an edge over Chinese rivals such as Huawei.
Over the past few months, Huawei has disclosed several agreements to sell its operating system and other automotive technologies to automakers in China, but has yet to announce major overseas deals in the sector. The company also sells electric vehicles through its jointly developed Aito brand.
“I think it is very difficult for Huawei to enter the global market because it is a sanctioned company,” Shen said. “I think it will be very difficult for Western companies to cooperate with them.”
Asked about the impact of U.S. restrictions on Chinese technology, Shen said his company has isolated operations in China from its overseas business and is complying with local requirements regarding U.S. artificial intelligence chip business and intellectual property protection.
Ecarx’s website lists offices in the US and Europe, as well as China.
Shen hopes Ecarx will increase its overseas sales from about 10% of current revenue to at least 25% next year and at least 40% in the next four to five years.
“Frankly, if we can’t serve the five largest automakers in the world, it will be very difficult for us to become a big company,” he said, “because none of the Chinese [original equipment manufacturers] among the top five in the world.”
BYD was the largest auto company in China last year, followed by Volkswagen’s local joint venture with FAW, which included fuel-powered vehicles, according to the China Passenger Car Association. Geely took third place.
Among new energy vehicles, which include hybrids and battery-powered vehicles, BYD ranked first, followed by Tesla, GAC’s Aion brand and then Geely, according to the association.