Huawei hints at the launch of its first electric vehicle in collaboration with China's largest automaker, SAIC.

      A teaser image of the Shangjie H5, the inaugural model collaboratively developed by Huawei and SAIC under the Shangjie EV brand. Credit: Huawei/SAIC

      Huawei has begun teasing its first model under the electric vehicle brand "Shangjie," collaborating with the Chinese automaker SAIC. On Monday, the company shared preview images of a sporty crossover that aims to attract consumers in China's highly competitive mid-range automotive market.

      Importance: The H5, which marks Huawei and SAIC’s first Shangjie EV with a projected price range of RMB 170,000 to RMB 250,000 ($23,698 to $34,850), is expected to aid both companies in penetrating the substantial, lower-priced segment of the EV market, where competitors like BYD, Geely, and Leapmotor already hold dominant positions.

      Huawei and SAIC, the largest manufacturer of gasoline vehicles in China, anticipate that the Shangjie H5 will be popular, particularly with young Chinese consumers. SAIC has faced declining sales and diminishing profits as consumers shift toward smart, electric vehicles.

      Huawei has primarily concentrated on the premium EV market, where it is now witnessing a slowdown in demand, supporting its brand portfolio under the "Harmony Intelligent Mobility Alliance (HIMA)," developed in partnership with several state-owned Chinese automotive companies, including Chery, JAC, and BAIC.

      The H5 may also draw customers away from more expensive rivals like the Tesla Model Y and Audi Q5L.

      A teaser image of the Shangjie H5, the inaugural model collaboratively developed by Huawei and SAIC under the Shangjie EV brand. Credit: Huawei/SAIC

      Details: The initial images released by the companies on the Chinese microblogging site Weibo reveal intriguing features of the H5 sports utility vehicle, such as a lidar sensor on the roof and a camera mounted on the side of the vehicle.

      This indicates that at least the higher-end version will include cutting-edge technology like advanced driver assistance systems, as noted by Huawei's consumer business chairman Richard Yu on Weibo. The H5 will have access to the fourth version of Huawei's Advanced Driving System, according to Liu.

      The streamlined and less bulky SUV showcases a coupe-style silhouette. However, as a crossover, it promises practicality and comfort, offering a spacious experience for rear-seat passengers, aided by its extended wheelbase, according to Sun Shaojun, founder of the consumer behavior research agency CarFans.

      The vehicle is expected to launch this autumn.

      Chen Hong, who was the chairman of SAIC at the time, spoke at the World Artificial Intelligence Conference (WAIC) in Shanghai in July 2018.

      Context: The collaboration between Huawei and SAIC highlights the increasing importance of Huawei as a provider of automotive parts and software in the sector. SAIC reversed its previous position after former chairman Chen Hong, who resigned last July, stated at a shareholder meeting in mid-2021 that sourcing a vehicle with comprehensive technology features from a single supplier like Huawei was akin to having a body without a soul, as reported by Caixin.

      The partnership was first announced in February for the development of new "globally competitive" smart EVs, according to TechNode, and an April announcement revealed plans for a specialized manufacturing facility in Shanghai's Lingang area, where Tesla’s plant is situated. SAIC’s new chairman Jia Jianxu mentioned that the automaker will invest RMB 6 billion in the initial phase of the project.

      Last year, SAIC reported an 88.2% decrease in net profit and a 15.4% drop in revenue, primarily due to poor performance from its partners Volkswagen and General Motors. SAIC lost its position as China's largest carmaker last year after nearly two decades at the top, as BYD surpassed it with a 41% rise in EV shipments, totaling nearly 4.3 million units.

      READ MORE: Huawei-backed EV maker Aito outsold Li Auto in June

      Jill Shen is a technology journalist based in Shanghai. She covers Chinese mobility, autonomous vehicles, and electric cars. You can contact her via email at [email protected] or find her on Twitter at @jill_shen_sh.