Business / Motoring

Tech companies' move to shake up auto industry

By Meng Jing (China Daily) Updated: 2016-06-28 08:00

Tech companies' move to shake up auto industry

Zhiche Auto displays its first internet car at the auto show in Beijing in April. [Photo/VCG]

Zhiche Auto, a Beijing-based tech startup, aims to replicate Apple Inc's success with the iPhone, but in China's automobile industry.

Founded at the end of 2014 with a team of 80 people, Zhiche announced a plan to kick off small-scale production of self-driving cars in 2017. And it favors the "asset light" approach-inviting original equipment manufacturers to produce cars based on its designs.

"Apple doesn't invent much innovative hardware. But by creatively assembling existing components, the company provides a brand-new user experience. That is the goal we want to achieve with cars," said CEO Shen Haiyin.

Zhiche's ambition may seem like pie in the sky, but it is far from the only pie up there. An increasing number of Chinese tech companies have one after another made moves to "disrupt" the country's automobile manufacturing industry using a big pool of cash and their expertise in big data, artificial intelligence and other internet-enabled technologies.

LeEco Holdings Co, known for its smart TV and smartphone products, in April released its first concept self-driving electronic car-28 months after the company decided to to enter the industry.

Jia Yueting, chairman and founder of LeEco, said it is very difficult for an internet company, an outsider when it comes to cars, to lead an industrial revolution in the automobile manufacturing sector. But he is a firm believer that it is important to make cars a part of LeEco's product range.

"We are creating cars connected to the internet to provide more services to drivers and passengers," said Ding Lei, head of LeEco' car development arm. "Cars will be the next platform after smartphones that people use to interact with their world."

LeEco set up a joint venture in mid-February with Aston Martin to develop the British luxury car brand's first electric vehicle. It also teamed up with other Chinese carmakers.

China's top three internet giants, Baidu Inc, Tencent Holdings and Alibaba Group Holding, have all made moves in the auto industry by teaming up with traditional carmakers. Baidu, which is betting big on autonomous driving, has successfully completed the first road test of a self-driving car at the end of last year.

Beijing-based Baidu has announced an ambitious plan to commercialize its cars in three years and go into mass production in five years.

Despite the exciting future prospects, analysts say the internet-enabled self-driving car industry is still taking shape and the technology remains under development.

A lack of a regulatory and legal framework also represents a hurdle for further development, said industry observers.

Zhang Changqing, a professor at law at Beijing Jiaotong University Law School, said autonomous driving will not be accident-proof, especially when there are other vehicles driven by humans on the same road.

Ma Si contributed to this story.


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