A new Tesla rival? Volkswagen looks to buy Huawei's self-driving business

And it wants to produce 1.5 million electric vehicles by 2025.
Loukia Papadopoulos
Volkswagen car maker logo on a building of dealership.josefkubes/iStock

What do you do if you fear Tesla's dominance? You get your own self-driving business.

At least that's what Volkswagen is planning to do, according to a report by Germany’s Manager Magazin published on Thursday.

Will the move prove fruitful?

Volkswagen buying Huawei's self-driving business

Volkswagen and Huawei are in talks about merging. The first would acquire the latter's autonomous driving business in order to compete with giants like Tesla.

There is currently no mention of pricing but the deal is being heralded as revolutionary. Huawei's self-driving capabilities have significantly improved over the last few years and could soon compete with Tesla's especially since the latter seems to be struggling of late.

Despite claims by Tesla's CEO Elon Musk that its technology is crash-free, the software is still widely viewed as unsafe if not downright dangerous. Meanwhile, Volkswagen has already experimented with autonomous vehicles, unveiling a prototype for a fully autonomous car all the way back in early 2017.

Although nothing was heard of the prototype again, the venture does show that Volkswagen has capabilities in the field. And its new move further indicates that the carmaker is dedicated as the acquisition is bound to be expensive.

Huawei's smart car division was set to spend a whopping $1 billion on research and development just for the year 2021. It also had ambitious goals of developing an R&D team with 5,000 members, 2,000 of which would be dedicated to autonomous driving. 

Competing for EVs

Autonomous vehicles aren't the only area in which Vokwasgen is competing with Tesla. In 2018, the German manufacturer unveiled a new range of all-electric commercial vehicles.

The company has also stated that it aims to produce 1.5 million electric cars by 2025. Last year, the firm released the ID.4 and the ID.5 GTX is set to be debuted soon. Both are promising electric vehicles that are bound to steal some of the market shares from Tesla.

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