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Source: Shutterstock
Summary
- ByteDance reportedly evinced interest in investing in domestic auto start-up QCraft.
- QCraft hopes to raise at least US$25 million in its latest round of fundraising drive.
- QCraft executives previously worked at Tesla and Uber.
Chinese social media giant ByteDance Ltd. could be eyeing to grab a slice of China’s expanding auto industry, dubbed as world’s largest vehicle market. The owner of the TikTok video app is reportedly looking to invest in the domestic self-driving start-up QCraft.
ByteDance has expressed interest in QCraft’s latest fundraising drive to raise at least US$25 million. The talks between the two are currently under wraps but it may be revealed as early as next week, according to a media report. QCraft’s autonomous driving technology is currently undergoing trial.
It is not the first time that a technology company has shown interest in investing in a different domain. In recent times, collaborations between tech and auto companies have become common as rapid technology innovations blur the past limitations of the industries. Companies such as Tesla, Ford, and GM have hugely benefited from their partnership with Google and Apple.
China’s rapid transformation of its auto industry from fossil fuel-led growth to renewable energy and automation-driven development has provided immense opportunities for the big companies willing to take a plunge into the Chinese market.
Pic Credit: Pixabay.
World’s Largest Auto Market
Besides American companies, various other Asian and European auto heavyweights have expressed interest in the booming Chinese auto market. The Chinese government, which is celebrating the 100th anniversary of Communist rule this year, plans to accelerate automation and green transformation as part of its next phase of development. It plans to go carbon neutral by 2060.
Several local auto companies are also making a mark in the domestic market. Companies like NIO Inc., which is also listed on NYSE, is one of the leading EV makers in China. It has rolled-out a record number of cars last year and plans to foray into Europe in the second half of 2021.
The recent EU-China Investment Agreement has opened doors for the big companies on both sides to tap each other’s markets, further raising the stakes in the competitive auto industry. According to the report, QCraft’s executives had previously worked with big US tech companies, such as Tesla and Uber, giving them a ringside view of the developments, which will help them in the business.
Founded in 2019, QCraft is an emerging player in intelligent simulation systems, one of the latest tools used by the industry. Currently, it is carrying out trials on minibusses in China. Besides Bytedance, Baidu Inc. and Tencent Holdings Ltd. have also evinced interest in the industry.
Bytedance’s Brush With President Trump
ByteDance hit the headlines last year after the Trump administration banned the TikTok video app citing national security risk over its user data collection in the US. It had blocked TikTok from floating an IPO on the New York Stock Exchange. The Biden administration is currently probing the allegations and it will take a while before it can reconsider any stock listing in the US in the future.
