Volkswagen Reportedly In Talks To Buy Huawei's Self-Driving Unit In China

Volkswagen AG VWAGY is leaving no stones unturned in its electrification efforts.

What Happened: Volkswagen is engaged in discussions with Huawei to buy the Chinese company's self-driving unit, CnEVPost reported, citing German magazine Manager.

The negotiations have been going on for months and the German company is seeking to acquire technology systems it does not specialize in, the report said.

Local Chinese media reported late last year that the two companies explored a potential partnership for autonomous driving. Huawei denied the reports.

Related Link: Emerging EV Market Dynamics: BofA Says GM, Volkswagen Aggressive Among Legacy Automakers

Why It's Important: China is a key market for Volkswagen, given the country's EV market penetration is among the highest in the world.

In 2021, the company sold about 70,600 ID-series EVs in China, which trailed the company's internal target of 80,000-100,000 units. It has set its sights high for 2022 and is looking to sell at least 140,000 IDs EVs in China.

CEO Herbert Diess said in a Q&A event held on Reddit that the company is looking at potential partnerships to be more self-sufficient in software.

A recent research report said the Germany legacy automaker is slowly and steadily catching up with the EV leader Tesla, Inc. TSLA.

Related Link: Volkswagen, Bosch Strike Partnership For Autonomous Driving Software: What You Need To Know