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Chinese electric vehicle maker Nio and tech giant Tencent have agreed to work together on areas including autonomous driving and high-definition mapping. The firms are keen to cash in on Beijing’s focus on new energy cars.
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The partnership will enable Nio to take advantage of Tencent’s cloud computing infrastructure for data storage and training for autonomous driving, as cars with self-driving technology require huge amounts of real-time data to be processed in order to train algorithms. In return, the partnership gives Tencent an opportunity to enter into China’s burgeoning EV sectors.
Why it matters
The tie-up between the two Chinese giants is not the first, with Alibaba and Nio rival Xpeng opening a computing center to train software for driverless cars in August. Both Nio and Tencent are banking on this partnership to pull them out of the muddy corporate situation they find themselves in, Tencent has seen its plug pulled on its core video gaming business due to strict domestic regulations. While Nio is facing its own challenges, including widening losses and pressure on margins from higher material costs and supply chain issues.
