Three firms team up for high-end auto brand

Contemporary Amperex Technology Co Ltd, a Chinese battery maker, will cooperate with Huawei Technologies Co, a technology giant, and Changan Automobile, a vehicle maker, to build a brand-new high-end automobile brand.

The move is an attempt to make the most of the unprecedented opportunities brought by China's latest development plan for the new energy vehicle sector, including the suppliers to the whole industry chain.

Zhu Huarong, chairman of Changan Automobile, disclosed in a TV program that the new cooperation will cover a world-leading autonomous and controllable smart electric car platform, a series of smart car products and a smart life-and-energy ecosystem.

Zhu did not disclose the extent of investment of each of the three companies in the new project. He, however, said the preliminary research and development of the project's first product has finished and is about to enter the mass production stage.

Early this month, China unveiled its latest development plan for new energy vehicles. The plan covers the period from 2021 to 2035, and sets out the path for the country to become an NEV powerhouse internationally by the end of the period.

The country will promote the whole battery supply chain over the next 15 years, so the supply of key battery raw materials must be enhanced, Zhu said.

Industry insiders said future electric vehicle sector investments are likely to center on component suppliers that deal in raw materials like lithium, nickel and cobalt.

Zhang Peng, an analyst from Chasing Securities, said: "The latest NEV plan has created an optimistic sentiment. The NEV industry chain is expected to replicate the miracle of Apple's smartphone chain."

The new plan also called for related enterprises to improve their capability in technological innovation, in order to achieve breakthroughs in key manufacturing equipment, and to improve production processes and efficiency throughout the supply chain.

Executives of Contemporary Amperex Technology, which has leading carmakers such as Tesla, BMW and Daimler among its clients, told China Daily that the company's newly developed rechargeable battery is capable of powering an electric vehicle for 2 million kilometers and will last 16 years.

Current models of batteries can help electric vehicles run for 250,000 kilometers. They have a life span of eight years maximum.

Deng Xue, chief auto analyst at TF Securities, said the new battery could be a potential game-changer; and Contemporary Amperex Technology's supply chain firms will also receive continuous opportunities to grow.

Though Contemporary Amperex Technology did not disclose any supply contracts, it has signed a two-year deal with Tesla to supply its Model 3 batteries. The US company had stated earlier that it was planning a million-mile battery.