Dissecting Tencent’s Operations in the Automotive Field
Amid a surging tide of car manufacturing across China’s internet technology industry, Tencent‘s layout in the field has always been regarded as light, far less than that of leading industry players such as Baidu, Huawei, and Xiaomi. However, at the beginning of September this year, Cham Zhong, the vice president of Tencent, said at a conference that “Tencent Intelligent Mobility has built a rich auto service ecology with more than 40 car companies such as Mercedes-Benz, BMW and Audi, with more than 150 models. The company helps more than 100 car companies and travel technology companies with cloud services.” According to Chinese media outlet Cyber Car, this shows that Tencent‘s auto business is actually progressing quite well.
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According to public information, 2015 was the starting point for Tencent in laying out its automobile business. After that, it held a launch event closely related to the automotive field almost every year. It can be seen that in recent years, the company has been constantly adjusting its business strategy in order to better connect its capabilities with the automobile industry.
In 2015, Tencent formally established a department called Tencent Auto Intelligence (TAI), positioned the digital assistant of car companies, thereby building up an auto ecosystem. In September 2016, it set up an automated driving laboratory headed by Su Kuifeng, the current general manager of Tencent‘s automated driving division. In 2017, the company released an ‘AI in Cars’ Strategy, and announced that it had reached strategic cooperation with GAC Motor, Changan Automobile, Geely, BYD and other car manufacturers.
After several years of explorations and upgrades, in June 2022, Tencent Intelligent Mobility announced a newly upgraded “Vehicle-Cloud Integration” strategy, which disassembled the business layout into three levels – cars, smartphones and cloud technology – helping the industry to carry out effective digital connection, establish a data-driven closed loop and improve production efficiency of all links.
Tencent‘s external investment in the field has included car makers, online ride-hailing platforms, automotive supply chain enterprises, automobile e-commerce and aftermarket entities. The enterprises include Tesla, NIO, WM Motor and many other automobile firms. Generally speaking, Tencent prefers leading auto companies with public listing potential, and pays more attention to the pursuit of capital returns. Its investment projects have less to do with promoting the firm’s own business, especially in the supply chain, which is quite disorganized.
Finally, it is worth mentioning that automated driving cloud services have always been at the core of Tencent‘s smart mobility business. In June this year, the firm put forward its “Vehicle-Cloud Integration” concept and launched Tencent Smart Car Cloud, which once again clarified the importance of cloud technology. Tencent Cloud has built a complete cloud services solution, which can provide laaS (infrastructure as a service) + PaaS (platform as a service) + SaaS (software as a service).
Focusing on the automated driving field, Tencent Smart Car Cloud has been able to connect the whole link and life cycle of automated driving R&D, such as data collection, storage, labeling, algorithm training, simulation, evaluation, mass production data return and data operations. With years of accumulation in big data, AI and other fields, as well as a strong computing power layout, combined with localized traffic scenarios and application requirements, Tencent can be considered to be one of the most competitive players in the automotive cloud technology field.