China Auto Roundup: Canada to Hit China With Tariffs on EVs, Huawei Sells Stake in Smart Car Unit

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Electric vehicles await export at Suzhou Port Taicang International Container Terminal on Dec. 13, 2023. Photo: VCG

Welcome to the Auto Roundup — a weekly briefing on the biggest headlines in China’s automotive industry covering electric vehicles, gas-powered cars, battery and autonomous technology, and more.

Canada to hit China with tariffs on electric vehicles, steel

Canada will impose new tariffs on Chinese-made electric vehicles, aluminum and steel, lining up behind Western allies and taking steps to protect domestic manufacturers.

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Canada will levy a 100% tariff on Chinese electric vehicles and 25% on steel and aluminum starting Oct. 1, aiming to protect local industries.
Huawei sold a 10% stake in its car unit to Seres Group for $1.6 billion to boost their Aito brand, aiding Huawei's automotive profits.
Toyota's Beijing plant began producing hydrogen fuel cell systems with an initial capacity of 10,000 units yearly, expanding to 2026.

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Who’s Who

Huawei Technologies Co. Ltd.: Huawei Technologies Co. Ltd. has sold a 10% stake in its car unit to Seres Group Co. Ltd. for 11.5 billion yuan ($1.6 billion), as its smart car business turned a 2.23 billion yuan profit in the first half of 2024. The deal is intended to help the Aito brand, co-developed with Seres, to become a leading luxury automotive brand.

Seres Group Co. Ltd.: Seres Group Co. Ltd., a Chongqing-based automaker, has agreed to pay 11.5 billion yuan ($1.6 billion) for a 10% stake in Huawei’s smart car unit. This deal is intended to strengthen the Aito brand, co-developed by Seres and Huawei in 2021, in the new luxury automotive segment. The payment will be made in three cash installments.

Geely Automobile Holdings Ltd.: Geely Automobile Holdings Ltd. has raised its 2024 export target to 380,000 units from 330,000 units after a 67% year-on-year growth in exports during the first half of the year. CEO Gan Jiayue attributed this success to strong expansion in emerging markets like Africa, Central Asia, Mexico, and other regions, including the Middle East, Eastern Europe, and Southeast Asia.

United Fuel Cell System R&D (Beijing) Co. Ltd.: United Fuel Cell System R&D (Beijing) Co. Ltd. is a joint venture backed by Toyota and five Chinese partners, including fuel cell system developer Beijing Sinohytec Co. Ltd., China FAW Group Co. Ltd., Dongfeng Motor Corp. Ltd., Guangzhou Automobile Group Co. Ltd., and Beijing Automotive Group Co. Ltd. Toyota holds a 65% stake in the venture, which focuses on developing and manufacturing hydrogen fuel cell systems.

Beijing Sinohytec Co. Ltd.: Beijing Sinohytec Co. Ltd. is a Chinese fuel cell system developer and one of Toyota's partners in the United Fuel Cell System R&D joint venture. This venture, which also includes China FAW Group, Dongfeng Motor, Guangzhou Automobile, and Beijing Automotive Group, aims to develop and manufacture hydrogen fuel cell systems for vehicles. Sinohytec is involved in backing a new plant in Beijing with an initial production capacity of 10,000 fuel cell systems annually.

China FAW Group Co. Ltd.: China FAW Group Co. Ltd. is one of the Chinese partners in a joint venture with Toyota and other companies to develop and manufacture hydrogen fuel cell systems. This venture, United Fuel Cell System R&D (Beijing) Co. Ltd., aims to produce up to 10,000 hydrogen fuel cell systems annually. FAW is part of a collaborative effort to boost hydrogen fuel cell technology in the automotive sector.

Dongfeng Motor Corp. Ltd.: Dongfeng Motor Corp. Ltd. is one of the five Chinese partners collaborating with Toyota in the United Fuel Cell System R&D venture, which focuses on developing hydrogen fuel cell systems for vehicles. The initial capacity of the new Beijing plant is 10,000 fuel cell systems annually, with plans for expansion in 2026.

Guangzhou Automobile Group Co. Ltd.: Guangzhou Automobile Group Co. Ltd. is a Chinese automaker and one of the partners in United Fuel Cell System R&D (Beijing) Co. Ltd., a joint venture with Toyota and others aimed at developing hydrogen fuel cell systems. The partnership is part of a project that recently began operations in Beijing to produce fuel cell systems for vehicles.

Beijing Automotive Group Co. Ltd.: Beijing Automotive Group Co. Ltd. is one of the partners in the United Fuel Cell System R&D (Beijing) Co. Ltd., a joint venture led by Toyota to develop and manufacture hydrogen fuel cell systems for vehicles. The Beijing-based company is contributing to the plant's initial capacity of producing up to 10,000 fuel cell systems annually, with a second phase of the project planned for launch in 2026.

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What Happened When

July 2024：: A survey by the China Automobile Dealers Association revealed many dealers losing money in the first half of 2024 due to price cuts and weak demand.

Wednesday, August 21, 2024：: Toyota announced the beginning of operations for a new plant in Beijing to develop and manufacture hydrogen fuel cell systems for vehicles.

Friday, August 23, 2024：: Huawei signed a deal to sell a 10% stake in its car unit to Seres Group Co. Ltd. for 11.5 billion yuan ($1.6 billion).

Monday, August 26, 2024：: Prime Minister Justin Trudeau unveiled the policy of imposing new tariffs on Chinese-made electric vehicles, aluminum, and steel in Halifax, Nova Scotia.

Monday, August 26, 2024：: The Chongqing-based automaker Seres disclosed the Huawei deal in a Shanghai Stock Exchange filing, with three cash installments for the purchase.

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