Great Wall Motor will set up a chip company with its chairman that may involve chip development in the areas of IGBTs, autonomous driving and smart cockpit.
(Image credit: Great Wall Motor)
Great Wall Motor plans to set up a chip business subsidiary, becoming the latest local car company to do so.
The automaker plans to use its own funds to set up Xindong Semiconductor Technology Co Ltd (芯动半导体科技有限公司) with chairman Wei Jianjun and an entity controlled by Wei, according to an exchange announcement today.
The company will have a registered capital of RMB 50 million ($6.9 million), with Wei contributing RMB 5 million, or 10 percent, and Great Wall Motor contributing RMB 10 million, or 20 percent.
Wensheng Technology, in which Wei and his wife Han Xuejuan hold 99 percent and 1 percent of the equity, respectively, will contribute RMB 35 million, or 70 percent of the shares.
Great Wall Motor's announcement did not explicitly mention that the new company is a chip-making company, but its business scope involves chip business, including integrated circuit design, integrated circuit manufacturing, and electronic component and assembly manufacturing.
The move means Great Wall Motor will develop chips in-house, local media Cailian said, citing an unnamed source at the car company.
Great Wall Motor's chip development will involve IGBT, autonomous driving and smart cockpit areas, the report said, citing a person familiar with the car company.
The automaker has poached some R&D staff from Samsung, and its business model is similar to Geely's affiliate SiEngine Technology, the person said.
Although the chip shortage across the auto industry is not as severe as it was a year ago, Great Wall Motor still seems to be plagued by the problem recently.
The automaker sold 93,642 vehicles in September, down 6.38 percent from 100,022 units a year earlier, an announcement earlier this month showed.
This was mainly due to a shortage of multimedia chip supply and a decrease in sales of traditional internal combustion engine vehicles due to the company's product transition to new energy vehicles, Essence Securities said in a recent research note.
In addition to Great Wall Motor and Geely, Chinese electric vehicle startups are also actively involved in chip development.
Nio, Xpeng Motors and Li Auto are all developing their own chips or conducting related research, with Nio making the most progress and investing the most, according to a report by local media outlet LatePost earlier this month.
Nio has assembled a chip team of nearly 300 people to develop both self-driving chips and LiDAR chips, according to the report.
Xpeng began recruiting chip teams at the end of 2020, and the team, which is currently no more than 200 people in size, is developing a large-calculus self-driving chip similar to Tesla's FSD, the report said.
Li Auto expanded its chip team earlier this year and now has dozens of people, but is still in the early research phase, according to LatePost.
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