In the field of new energy vehicle manufacturing, Huawei has achieved a leading position in mindshare, while BYD, the "top automaker", can only satisfy the demand for large volumes.

Author|Lan Dong Business Zhao Weiwei

How far is BYD from surpassing Huawei?

In 2023, the income gap between the two was 101.9 billion yuan. In 2024, the gap narrowed to 85 billion yuan. Huawei's revenue in 2024 was 862.1 billion yuan, very close to the peak of 891.4 billion yuan in 2020. However, BYD's rapid growth cannot be underestimated, with its revenue in 2024 increasing by 29.02% year-on-year, 6.62 percentage points higher than Huawei's growth rate.

Huawei is returning to its peak, while BYD is aiming to become the king of electric vehicles.

The more obvious contrast is in net profit, where BYD shows a more pronounced upward trend. Huawei's net profit in 2024 was 62.6 billion yuan, a year-on-year decrease of 28%. BYD's net profit in 2024 was 40.254 billion yuan, a year-on-year increase of 34%.

Of course, Huawei is investing more in the future.

An important factor affecting Huawei's net profit is R&D expenditure. In the past year, Huawei's R&D expenditure was 179.7 billion yuan, accounting for about 20.8% of its annual revenue. For BYD, last year's R&D expenditure of 54.2 billion yuan also exceeded its net profit, setting a historical high. This shows the determination of both companies to bet on the future.

The gap between BYD and Huawei is narrowing, and Wang Chuanfu is also catching up with Ren Zhengfei.

At a private enterprise symposium, a camera captured Wang Chuanfu glancing at Ren Zhengfei's notes. This detail was ridiculed by the outside world as a top student copying someone else's homework. In fact, as early as 15 years ago, when BYD had not yet waited for the spring of new energy policies, Wang Chuanfu said at the end of an interview with Caixin that Ren Zhengfei, the 66-year-old president of Huawei, was a strategist and his role model.

This may be the earliest public display of Wang Chuanfu's admiration for Huawei. Almost no Chinese entrepreneurs do not admire Ren Zhengfei, and Wang Chuanfu is no exception.

Learn from Huawei when facing difficulties

The Soul of Engineers is the only officially authorized book of BYD, and Huawei is mentioned multiple times in the book, making it easy to see BYD's respect for Huawei.

Both are private enterprises in Shenzhen, but their businesses are fundamentally different. BYD started with batteries and its core business is vehicle manufacturing, while Huawei's core is communication equipment and consumer electronics. BYD Electronics, a subsidiary of BYD, provides OEM services for Huawei, and Huawei, along with Xiaomi, OPPO, and other mobile phone manufacturers, is one of the core customers of BYD Electronics.

"Huawei excels in R&D and branding, while BYD excels in R&D and manufacturing," this is how the book describes the difference between the two.

BYD respects Huawei. Just as Wang Chuanfu defined Ren Zhengfei as a "strategist" 15 years ago, The Soul of Engineers also positions Ren Zhengfei as a "thinker" in the business world.

The comparison with Huawei further leads to the definition of BYD. Both companies have a strong engineering culture and have a similar number of R&D personnel, both exceeding 100,000.

If Ren Zhengfei is a thinker, then what about Wang Chuanfu? "Wang Chuanfu's most willing role is still that of chief engineer. BYD's engineers are adept at summarizing design specifications and error files."

In 2024, the number of BYD's R&D personnel surpassed that of Huawei. Huawei had 113,000 R&D employees, while BYD had 122,000 R&D personnel.

In terms of the number of R&D personnel alone, BYD has caught up with Huawei. However, we also need to consider the proportion of R&D personnel. Huawei's R&D personnel account for 54.1% of its total workforce, while BYD's workforce is much larger, reaching 968,000 at the end of 2024. Therefore, the proportion of R&D personnel is only 12.6%, far lower than that of Huawei, and the growth rate of R&D personnel is also much lower than that of the total workforce.

Managing nearly a million employees is not an easy task for BYD.

Just as the Huawei Basic Law laid the foundation for Huawei's management and values, BYD also had its own BYD Basic Outline in 2024, summarizing its 30 years of experience, including its mission, development philosophy, strategy, and corporate culture. This may be the most obvious place where BYD pays tribute to Huawei.

There are many similarities between the two. Huawei is customer-centric, while BYD believes in "selling one car and making one friend." Huawei emphasizes that technology is the core competitiveness of an enterprise, with R&D expenditures accounting for no less than 10% of revenue. BYD emphasizes technology as the king and innovation as the foundation, building a "technology fishpond" strategy. Huawei proposes that human capital appreciation takes precedence over financial capital, and BYD also emphasizes that talent is the company's most precious asset, "implementing a combination of independent training and incentives."

Of course, the biggest difference between the two is the 26-year gap. The Huawei Basic Law was introduced in 1998, and it was this law that led to the later success of Huawei. BYD, on the other hand, had its first 30 years before the BYD Basic Outline was introduced.

Learning from Huawei when facing difficulties is a method adopted by many Chinese enterprises and a true portrayal of BYD's historical development.

In 2010, Wang Chuanfu personally said that Ren Zhengfei was a strategist and his role model. This was precisely because BYD was facing an unprecedented difficult situation at that time. At that time, the gap between the two was obvious. Huawei, which had already established a global presence, had annual sales of $36 billion, while BYD's annual turnover was only 46.685 billion yuan, less than a fifth of Huawei's.

It was BYD's 15th anniversary, and its sales plan was aggressive, but the market was not well prepared. Its performance declined, and its net profit was halved, resulting in BYD's largest loss since its establishment. As a result, BYD laid off a large number of employees, cut two-thirds of its dealers, strictly controlled car quality, and appointed its first full-time public relations director for the brand.

Technology is not omnipotent, and management and strategy were BYD's weaknesses at that time. After three years of adjustment, Wang Chuanfu solved the problem.

From partners to competitors

In Huawei's latest 2024 annual report, the direct connection to BYD is in the Fangchengbao 8 model, which is part of Huawei's intelligent vehicle solutions business. This is the first BYD model to be equipped with Huawei's Kunlun Intelligent Driving ADS 3.0, and Huawei intends to demonstrate how its technological advantages can help BYD achieve commercial success.

This is also one of the few promotional cases on Huawei's official website that showcase cooperation with BYD. The last cooperation dates back to 2018, when Huawei helped BYD build a smart factory.

However, in 2025, some subtle changes began to emerge, as BYD started promoting its own intelligent driving Tianshen Eye.

As a result, the Fangchengbao 5 was launched with four intelligent driving versions, including two high-end versions equipped with BYD's Tianshen Eye and two versions equipped with Huawei's Kunlun Intelligent Driving. The Kunlun Intelligent Driving versions are priced 50,000 to 70,000 yuan higher than the Tianshen Intelligent Driving versions.

In other words, whether consumers prefer BYD's intelligent driving capabilities or are more willing to pay for Huawei's intelligent driving solutions, the sales volume of Fangchengbao 5 will be the most direct answer.

"Cars without intelligent driving will become a minority. 2025 is the first year of comprehensive intelligent driving," said Wang Chuanfu. BYD launched 21 intelligent driving models in 2025, mostly priced between 100,000 and 200,000 yuan, and even extended intelligent driving capabilities to the "Seagull" model, which starts at 70,000 yuan. This is equivalent to bringing the previously high-end intelligent driving technology back to an affordable price.

In the first three months of this year, BYD has been constantly active. Cheaper intelligent driving is just one of its technological aces. BYD also released the Super E Platform, achieving a charging power of 1 megawatt. It also collaborated with DJI to release the Lingyuan in-car drone, claiming to be the world's first automaker to mass-produce in-car drones.

In the field of intelligent driving, BYD will soon become a competitor to Huawei.

Huawei's advantage lies in its in-depth independent research and development in the field of intelligent driving. While BYD relies on external suppliers for core capabilities such as chips and algorithms, it is also unwilling to lag behind.

At a minimum, BYD's intelligent driving team has expanded from over 100 people in 2022 to over 5,000 people in 2025, basically at the same level as Huawei's intelligent driving team in the BU (Business Unit).

In the field of new energy vehicle manufacturing, Huawei has achieved a leading position in mindshare, while BYD, the "top automaker", can only satisfy the demand for large volumes.

BYD's advantage lies in its large volume. Wang Chuanfu announced at a recent internal closed-door meeting that BYD's total sales target for 2025 is 5.5 million vehicles, with an internal high-end sales target of 6 million vehicles. This means that BYD must maintain a growth rate of nearly 29% this year. Judging from the results of the past two years, BYD undoubtedly exceeded its sales targets for the year.

The challenge for BYD to reach 6 million vehicles lies not in production capacity but in orders. Only by leveraging its scale advantage can BYD amortize the R&D costs and hardware costs of intelligent driving, a height that any automaker with a smaller sales volume cannot reach.

Intelligent driving still awaits a major test

Incidents involving issues with intelligent driving occur every year, and this time it is Xiaomi, which has been showing rapid growth. On March 29, a serious accident occurred on a highway involving a Xiaomi SU7 car, which collided with a guardrail and caught fire. All three occupants, including the driver, perished inside the vehicle, attracting widespread attention on the internet.

Xiaomi responded on April 1, stating that the vehicle was in NOA (Navigate on Autopilot) intelligent assisted driving mode before the accident, traveling at a speed of 116 km/h. The section of the road where the accident occurred was under construction and repair, with roadblocks closing the self-lane and diverting traffic to the opposite lane. After detecting the obstacle, the vehicle issued a warning and began to decelerate. Subsequently, the driver took over the vehicle and entered manual driving mode, continuing to decelerate and steer the vehicle. Then, the vehicle collided with a concrete pillar of the median strip. The system's last confirmed speed before the collision was approximately 97 km/h.

However, many factual issues have not yet been specifically explained and require further disclosure by Xiaomi and the traffic police.

For example, were the door handles of the accident vehicle unable to open? Was the vehicle's automatic emergency braking function activated? What caused the vehicle to catch fire, was it the vehicle's power battery or a short circuit in the wiring? Since the standard version of the Xiaomi SU7's power battery is provided by only two companies, BYD and CATL, both using 73.6 kWh lithium iron phosphate power batteries.

On April 2, an investor asked on the interactive platform if the Xiaomi SU7 involved in the accident on March 29 used the company's batteries. In response, CATL said, "It's not our battery."

Before the complete investigation results are released, it is not possible to determine the responsibility for this incident.

On the evening of April 1, Lei Jun also posted on Weibo to express condolences for the accident, stating that since the accident is still under investigation and they have not had access to the accident vehicle, many questions cannot be answered at this moment. However, on behalf of Xiaomi, he promised: "No matter what happens, Xiaomi will not evade. We will continue to cooperate with the police investigation, follow up on the progress of the matter, and do our utmost to respond to the concerns of the family and the society."

At present, the intelligent driving of domestic automakers is basically at Level 2, and there is still a long way to go before reaching Level 4 fully autonomous driving. Xiaomi's intelligent driving is claimed to be fully self-developed. Lei Jun previously mentioned that Xiaomi, Huawei, and NIO, Xpeng, and Li Auto are companies that are particularly determined to invest in intelligent driving.

Last April, a Wenjie M7 Plus vehicle was involved in a traffic accident in Yuncheng, Shanxi, resulting in a collision and fire, ultimately leading to the deaths of three people. This incident raised questions about the vehicle's AEB (Automatic Emergency Braking) function, battery, airbags, and doors.

AEB is the most basic function of the assisted intelligent driving system and can effectively avoid rear-end collisions. In the subsequent response issued by Thalys, it was stated that the M7 Plus was equipped with an assisted intelligent driving system from other suppliers, and its AEB function had a smaller working range than Huawei's ADS. The speed of the accident vehicle in Yuncheng when the collision occurred was 115 km/h, exceeding the working range of the Automatic Emergency Braking (AEB).

The cases of Wenjie and Xiaomi have cast a shadow over the entire intelligent driving boom in the new energy automobile industry.

2025 is widely promoted as the year for the implementation of Level 3 autonomous driving in the automotive industry, and more intelligent driving systems will appear on the roads.

When BYD promotes "intelligent driving equality" and extends intelligent driving to entry-level models, this means that more than 3 million new vehicles with intelligent driving capabilities will be on the road. When Xpeng Motors announced that it will enter full-scenario Level 3 autonomous driving in the second half of this year, Huawei also revealed that ADS 4.0 will be launched in the third quarter of this year, with Level 3 autonomous driving capabilities. This means that intelligent driving cannot be separated from driver intervention for the time being and is not as intelligent as imagined.

Undoubtedly, competition in the new energy vehicle market will further intensify in 2025, but the intelligent driving capabilities of various brands will also face tests.