BEIJING, October 18 (TMTPOST)— A Chinese technology company that engages in cyber security more than a decade bursts into electric vehicle (EV), an industry that is witnessing intensified competition. Qihoo 360 announced on Monday that its board of directors has approved an equity investment plan of RMB2.9 billion (US$450 million) to acquire 16.594% of stakes in HOZON Auto, a startup focusing on R&D and manufacturing of new EV under the brand Nezha.
Qihoo is set to be the second largest shareholder when the transaction completes. The company said its decision of investment was made on opportunities and prospects of the cyber security and the intelligent and connected vehicle (ICV). It is noteworthy that September saw HOZON first delivered more than 7,000 vehicles in a month and ranked top three by monthly delivery among the emerging EV makers in China. Its delivery that month rose 16.4% from August to 7,699 units, more than half of the annual sales last year.
Qihoo plans to work with other HOZON’s strategic partners to make use of advantages in various sectors such as security for Internet of vehicles (IOV), self-driving, intelligent cockpit, so as to help HOZON keep refining products and create an industrial example of security solutions for the connected vehicle through the whole life cycle.
The latest investment suggests further partnership between Qihoo and HOZON as Qihoo just declared the entry into EV through the cooperation with HOZON in May, about two months after China’s leading smartphone maker Xiaomi officially unveiled to produce smart EV. In the beginning of July, Qihoo’s founder Zhou Hongyi underlined his view of “Building the affordable EV for the public”. He said a smart EV can only cost no more than RMB150,000 (US$23,000). Zhou noted 70% of the total sales in China came from those vehicles that sold less than RMB150,000 and expected smart EV would never enter the mainstream if it can’t attract the customers who are willing to spend no more than RMB150,000.
At 2021 World Internet Conference Wuzhen Summit last month, Zhou stressed his company treated ICV as a breakthrough in advanced manufacturing. If Chinese internet companies can export digital technologies to traditional auto-makers, the country’s automobile industry will gain significant advantages in digitalization and intelligence against rivals in U.S., Japan and the Europe, Zhou expected.