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The intelligent driving industry may enter a period of elimination and integration.

According to a report by Wandian Auto on August 14, the restructuring plan promoted by domestic intelligent driving solution provider HoloMatic and GAC Group has encountered changes, and HoloMatic's current financial situation is very tight. Affected by this, HoloMatic is disbanding most of its core departments such as data and R&D, and suspending R&D activities.

According to people familiar with the matter, the beginning of the discussion between Hodo Technology and GAC Group on restructuring can be traced back to July this year, when the restructuring plan was close to being finalized. However, after the restructuring plan failed to receive support from all shareholders, Hodo Technology founder and CEO Ni Kai sent an internal letter to inform employees of the matter, stating that the company would not be able to pay July wages and overdue wages and housing provident funds.

Regarding the above situation, the reporter of Daily Economic News tried to contact HoloMatic to understand it, but no response was received as of press time. At the same time, the reporter checked the official website of HoloMatic and found that there are still a large number of job openings posted on the website, and many of them are specifically for campus recruitment groups.

Has the accumulated financing of over 1 billion been used up?

Tianyancha shows that Hodo Technology was founded in June 2017 and is a company focusing on mass production solutions for autonomous driving. The company's founder, Ni Kai, was a senior scientist at Baidu's Deep Learning Institute and an important technical leader in the early days of Baidu's autonomous driving business.

Since its establishment in 2017, HoloMed has completed multiple rounds of financing, with a total financing of over RMB 1 billion, and investors include IDG, Sequoia China, Guangdong Science and Technology Financial, GAC Group and NavInfo. The most recent round of financing was the C3 round of financing in July 2023, jointly led by Guangdong Guangdong Science and Technology Financial Group and GAC Capital, with a financing amount of RMB 300 million.

According to the official website of HoloMatic, its main products and businesses include two core products: the driving autonomous driving system HoloPilot and the parking autonomous driving system HoloParking. In order to meet the different performance requirements of high-level autonomous driving systems from L2+ to L4, it launched the autonomous driving domain controller HoloArk and the intelligent front-view camera HoloIFC based on the Horizon Journey series chips.

According to the reporter, Hodo Technology reached a cooperation with GAC Group as early as 2021, and received three rounds of investment of about 400 million yuan from GAC. After completing the C+ round of financing in July last year, GAC Group held about 13% of Hodo Technology's shares and became the largest external shareholder. On the business level, since 2022, Hodo Technology's intelligent driving solutions (including parking and driving) have also been implemented on GAC Aion, Trumpchi, Haobo and other models.

"At present, the intelligent driving company has started a new mass production project, which requires a large amount of investment in the early stage. After mass production and delivery, the licensing fees that the intelligent driving company can obtain are often directly related to the sales volume of the vehicle model." said an intelligent driving industry insider.

It is worth mentioning that this is the case with Hodo Technology in the process of meeting the order requirements of its main customer GAC Group. For example, the Haobo GT, which was launched at the end of 2022, delivered a total of 3,583 units in 2023, and the cumulative sales from January to July 2024 were 3,413 units, which is a big gap compared with the annual sales target of 50,000 units set in 2024.

However, as some changes emerged in the cooperation project with GAC Group, Hodo Technology's operating difficulties further intensified, and news of a restructuring plan emerged.

The intelligent driving industry is experiencing a "cooling down" of capital

In fact, the situation faced by Hodo Technology is not an isolated case, but a common challenge faced by the current intelligent driving industry.

On the one hand, the R&D costs of the autonomous driving industry are high and face great financial pressure. Take RoboSense as an example. Its R&D expenditures from 2020 to 2022 were RMB 82 million, RMB 133 million, and RMB 306 million, respectively, accounting for 47.7%, 40.2%, and 57.7% of its total revenue in the same period.

On the other hand, the industry generally faces the problem of high dependence on major customers. For example, Zhixing Technology's prospectus disclosed that from 2020 to June 30, 2023, the company's revenue from Geely Group accounted for 0%, 53.0%, 96.4% and 95.0% respectively.

At the same time, the continued price war will also squeeze the profits of suppliers. "Because the market is too competitive, automakers force suppliers to reduce prices, and the survival space of suppliers is limited, which affects subsequent research and development," said Dai Yifan, assistant director of Tsinghua University Suzhou Automotive Research Institute.

In addition, many companies are now pursuing self-developed technologies, such as Huawei and Weilai. Huawei not only develops its own laser radar and intelligent cockpit system, but also other core software and hardware, including autonomous driving chips. This has also had an impact on the business of suppliers of autonomous driving.

"After the boom, the capital market's pursuit of the intelligent driving industry has begun to cool down." An investor admitted. As the progress of technology implementation is not as expected, it is difficult to achieve large-scale blood production in the short term. The investment in L4 has cooled significantly, and American autonomous driving companies have also faced a wave of bankruptcies. For example, in October 2022, the star company Argo AI announced its closure and dissolution, and some of its employees were taken over by investors Ford and Volkswagen.

In this context, the entire industry may quickly enter a period of elimination and integration, with some companies actively seeking to go public to recover their losses, while others are shrinking or being eliminated. In this regard, some industry insiders said that how to improve the self-sustaining ability of enterprises will be a key issue that autonomous driving companies need to focus on in the future.

Daily Economic News