DJI Automotive Enters the Elite Circle: FAW Becomes the Largest Shareholder

The dust has settled. FAW has finally chosen to invest a large amount of money to take a stake in Zhuoyu.

According to the case of FAW Group Corporation Limited's acquisition of part of the equity of Shenzhen Zhuoyu Technology Co., Ltd. publicized by the State Administration for Market Regulation, through capital increase and equity acquisition, FAW Group will obtain 35.8% of the equity of Zhuoyu Technology, and the shareholding of the original controlling shareholder, New Territory, will drop to 34.85%. The two parties will jointly control Zhuoyu Technology.

The announcement did not disclose the specific amount of this transaction. The previously rumored "equity transaction exceeding $800 million" cannot be verified, and FAW did not achieve "control." However, this has made FAW the largest single shareholder of Zhuoyu Technology.

It is worth mentioning that not long ago, FAW Hongqi announced a deepened cooperation with Huawei. The new models will be equipped with Huawei's Qiankun intelligent driving system, Hongmeng cockpit system, etc. Now, FAW has taken a stake in Zhuoyu. With Huawei on one hand and Zhuoyu on the other, this "senior brother" FAW is finally going to make a move.

01

FAW Had Its Eyes on Zhuoyu Long Ago

If the State Administration for Market Regulation had not publicized this equity acquisition case, we might still be guessing who would enter Zhuoyu Technology. After all, before this, it was reported that more than just FAW Group was interested in Zhuoyu Technology.

Although the content disclosed in this announcement is relatively simple, it also explains the general situation of the transaction between the two parties and the structure of the operators.

The publicized information shows that China FAW Group Corporation Limited ("FAW Group") has signed an agreement with New Territory Technology Company Limited ("New Territory") and Shenzhen Zhuoyu Technology Co., Ltd. ("Zhuoyu Technology") to increase capital and acquire the equity of Zhuoyu Technology held by New Territory.

Moreover, this transaction belongs to the situation where "the operators participating in the concentration have an upstream - downstream relationship, and their market shares in the upstream and downstream markets are both less than 25%."

It is also disclosed that in the Chinese advanced driver - assistance system (ADAS) market in 2024, New Territory (through Zhuoyu Technology) had a market share of 0 - 5%; in the Chinese passenger car market in 2024, FAW Group's market share was 10 - 15%.

Before the transaction, New Territory held 70.65% of the equity of Zhuoyu Technology and independently controlled Zhuoyu Technology. After the transaction, FAW Group will hold 35.80% of the equity of Zhuoyu Technology, and New Territory will hold 34.85% of the equity. The two parties will jointly control Zhuoyu Technology.

Zhuoyu Technology was formerly the in - vehicle division of DJI. It was established in 2016 and was spun off from DJI in 2023 to become an independently operated company. In June 2024, it officially adopted "Zhuoyu" as its brand name and introduced external capital. It has successively received investments from automobile companies and institutions such as BYD, SAIC, SDIC Venture Capital, Cornerstone Capital, and Guangyuan Capital, with a cumulative financing of more than 2.5 billion yuan.

It is worth mentioning that previously, New Territory, the largest shareholder of Zhuoyu Technology, held 70.65% of the equity. People may not be familiar with this company, which was only established in Hong Kong in 2022.

However, according to the introduction of the operators in the announcement, the ultimate controller of New Territory is a natural person, who is mainly engaged in the R & D, design, production, and sales of drones, handheld imaging devices, robot education, and related solutions through the companies under their control. It is actually not difficult to guess who the actual controller of New Territory is.

Although the specific consideration for the 35.8% equity in this transaction is not clearly stated in the announcement, if we calculate based on the previously exposed investment of $800 million corresponding to 35.8% of the equity after the transaction, the post - investment valuation of Zhuoyu Technology in this transaction can also be roughly estimated, which is about 16 billion yuan.

This estimated result is basically consistent with the information mentioned in previous media reports that "the post - investment valuation exceeds 10 billion yuan."

Actually, it is not surprising that FAW has placed a bet on Zhuoyu Technology. After all, before this, Zhuoyu and FAW have always been strategic partners. As early as 2023 when Zhuoyu was still called DJI In - vehicle, FAW led its Pre - A round of financing.

At the Zhuoyu Chengxing Technology Day in March this year, the Hongqi Tiangong 05 under FAW achieved the "only in the industry" bionic vision end - to - end full - scenario solution with Zhuoyu Chengxing's intelligent driving 3.0 + the globally launched 10V visual intelligent driving assistance system, the first inertial navigation triple - camera solution, and the mass production of the globally launched Qualcomm Snapdragon Ride Platform SA8650P.

In addition, the newly launched all - new generation FAW - Volkswagen Sagitar L has become the first and only fuel - powered sedan in the mainstream fuel - powered sedan market to achieve map - free end - to - end high - speed pilot assistance, thanks to the IQ.Pilot enhanced driver - assistance system jointly developed with Zhuoyu Technology.

02

The King of Cost - Performance in the Industry

Currently, the technological routes of autonomous driving are mainly divided into two categories. One is the high - computing - power, multi - sensor fusion school, which achieves higher - level autonomous driving functions through the fusion of high - computing - power chips, lidar, high - precision maps, and other sensors. However, the cost is relatively high. Huawei is a typical representative of this school.

The other is the low - cost, vision - based school, which advocates optimizing algorithms to reduce the dependence on high - cost hardware and achieving high - level intelligent driving functions with a low - cost solution. Zhuoyu Technology belongs to the latter and is also the earliest supplier to introduce intelligent driving solutions to cars priced at around 100,000 yuan.

As early as 2024, the Baojun Yueye Plus equipped with Zhuoyu's intelligent driving solution introduced high - speed pilot functions to cars priced at around 100,000 yuan. Subsequently, with the 7 - camera, binocular vision + low - computing - power chip, 32TOPS computing - power solution installed on the Baojun Yunhai model, it introduced map - free end - to - end intelligent driving to cars priced below 100,000 yuan.

All along, Zhuoyu Technology's core advantage lies in the low - computing - power requirement brought by its pure - vision system, which enables low - cost deployment. The minimum installation price of a 7V + 32tops domain controller computing - power Chengxing platform solution can be compressed to less than 7,000 yuan.

The ultimate cost - performance of its "affordable" products used to be Zhuoyu Technology's invincible "killer weapon." However, with the trend of equalizing intelligent driving technology sweeping the market this year, a large number of competitors have entered the 100,000 - 200,000 - yuan market, which has also brought considerable pressure to Zhuoyu Chengxing.

As a result, there are more and more voices saying that Zhuoyu is falling behind in the first echelon of intelligent driving, which was previously known as the "DiDaHuaMo" (referring to four leading intelligent driving players). Especially this year, the orders from Baojun were snatched by "Huawei ADS."

Therefore, expanding its circle of partners and achieving large - scale implementation have become the top priorities for Zhuoyu Technology. After all, currently, the industry's impression of Zhuoyu's cooperative models mostly remains on Wuling Baojun and Hongqi Tiangong.

At the Shanghai Auto Show in early May this year, Zhuoyu officially announced its nine cooperation customers for the first time, including Volkswagen, SAIC - GM - Wuling, BYD, Chery Automobile, Great Wall Motor, China FAW, Dongfeng Motor, Audi, and BAIC Group. At the same time, Zhuoyu Technology said that more than 20 models have been mass - produced, and more than 30 models are about to be mass - produced.

This year, the first batch of fuel - powered cars with high - speed pilot assistance of the Volkswagen Group was officially launched in China. Although the solutions for Audi brand models come from Huawei, all the solutions for Volkswagen brand models come from Zhuoyu.

Moreover, Zhuoyu is already preparing for the overseas expansion of its intelligent driving business. Zhuoyu's test vehicles have appeared on the streets of Munich, Stuttgart, and Ingolstadt in Germany, officially starting local tests in Europe.

During the just - concluded Munich Auto Show, Zhuoyu officially launched its European strategy globally, announcing the establishment of its headquarters in Braunschweig, Germany. Its business mainly consists of two parts: connecting with European OEMs and helping Chinese automobile companies expand overseas.

It is expected that within next year, the test vehicles and test scenarios deployed by Zhuoyu in Europe will cover the whole of Germany. In the future, it will continue to increase its investment in computing power and infrastructure construction in Europe. In the near future, at least six Volkswagen - series models equipped with Zhuoyu's driver - assistance system will be launched.

It is not difficult to see that Zhuoyu Technology is deliberately accelerating the large - scale implementation of its products. With FAW's strategic investment in Zhuoyu Technology, as the so - called "number one in China," Zhuoyu Technology will have more confidence.

This article is from the WeChat official account "SuperEV - Lab" (ID: SuperEV - Lab). Author: Wang Lei, Editor: Qin Zhangyong. It is published by 36Kr with authorization.