Tencent invests in Tesla, and the three Internet giants frequently make their presence felt in the automotive industry

Tesla: Obtaining much-needed funds may boost sales in China

Reuters pointed out that Tesla is currently preparing for the mass production of Model 3, and Tencent's investment undoubtedly provides it with capital. On March 28, local time, Tesla's stock price rose 2.7% to $277.45, surpassing Ford Motor to become the second highest-priced American auto company after General Motors.

Tesla CEO Elon Musk said on social media Twitter on March 28 local time, "Glad to have Tencent as an investor and adviser to Tesla." However, Musk did not specify the specific meaning of "adviser." In another tweet, Musk pointed out that Tesla Model 3 currently has few orders from China and the car has not yet been officially launched in China. According to reports, Model 3 is expected to go on sale in the United States by the end of this year.

Some analysts pointed out that Tencent may be able to increase Tesla's sales in China, and even help Tesla's domestic production in China. Jeff Schuster, senior vice president of LMC Automotive Consulting, said, "For Tesla, this is definitely of great significance. Tencent's financing this time may help Tesla penetrate the Chinese market."

According to reports, Tesla's top four shareholders are its CEO Elon Musk (21%), fund giant Fidelity (14%), independent asset management company Baillie Gifford (8.2%), and institution T. Rowe Price (7.3%). After purchasing 5% of Tesla's shares, Tencent became its fifth largest shareholder.

Tencent: Combining internal innovation with external investment

As for why it invested in Tesla, Tencent responded that Tesla CEO Musk is a role model for entrepreneurs, and Tesla is a global leader in new technologies such as electric vehicles, driverless cars, shared vehicles, and sustainable energy production. Tencent has also been promoting a win-win ecosystem, hoping to combine internal innovation with investment in emerging technology industries. At present, in addition to a simple equity relationship, Tencent and Tesla may have commercial cooperation. However, there is no specific plan yet, and it will be decided in the future depending on the situation.

Reuters pointed out that Tencent's current market value is about $275 billion, about six times that of Tesla. On March 28, local time, Tesla, which was founded only 14 years ago, had a market value of about $45 billion, only $1 billion less than Ford, which has a history of 114 years.

For Tencent, this investment in Tesla can expand its presence in emerging markets, such as in the field of self-driving electric vehicles. Reuters pointed out that self-driving electric vehicles can refresh traffic patterns, realize car sharing and delivery services, and promote the development of auxiliary equipment such as infotainment and e-commerce. Adam Jonas, an automotive analyst at Morgan Stanley Investment Company, said he would not be surprised if Tencent and Tesla cooperated in the research and development and deployment of new technologies.

The White House has not yet responded to Tencent's investment, but the US president has always been critical of US automakers and China's trade policies.

Three giants: Investing in autonomous driving, new energy and mobile travel

Reuters said that technologies such as autonomous driving and electric vehicles and their potential to innovate business models have attracted billions of dollars in investment from China's three major technology giants (Tencent, Alibaba and Baidu). It should be noted that the start-ups invested by the three Internet giants are all developing autonomous driving systems, hoping to introduce autonomous driving technology into the mobile shared travel sector in the United States and China after 2020.

In addition to Tesla, Tencent participated in the Series A investment of NIO in June 2015. NIO's US headquarters is located in San Jose, not far from Tesla's Palo Alto base. Tencent has also invested in at least two other Chinese electric vehicle startups, including Harmony Futeng. In addition, Tencent has also invested in Didi Chuxing and Lyft in the United States.

Another Chinese Internet giant, Baidu, has invested not only in NIO and Uber, but also in Velodyne, a California-based lidar sensor manufacturer. In addition, Baidu has also established its own Intelligent Driving Business Group (IDG). Baidu stated in its announcement at the time that autonomous driving, smart travel, high-precision maps, and the Internet of Vehicles are important forces driving the upgrading of traditional industries in the era of artificial intelligence, and are also an important part of Baidu's strategic business and core capabilities. Previously, Baidu also stated that it would continue to increase its investment in the field of intelligent driving in the future.

Alibaba's investments in the mobile travel sector include Didi and Lyft. In addition, Alibaba and SAIC jointly invested in Banma Smart Driving and launched a remote control app of the same name. Recently, it was reported that Alibaba invested in Swiss AR car navigation company WayRay. WayRay will work with Banma Smart Driving to develop a new car with a built-in holographic AR head-up display, which will be unveiled in 2018. Just today (March 29), Alibaba released YunOS Carware, an intelligent in-vehicle operating system that supports HUD, car machine, driving recorder, and smart rearview mirror, and is committed to solving the problem of intelligent upgrades in the stock car market.

According to Reuters, Tencent has set up an office in Palo Alto, the center of California's Silicon Valley. Baidu and Alibaba also have offices in Silicon Valley.

As a winner of Toutiao's Qingyun Plan and Baijiahao's Bai+ Plan, the 2019 Baidu Digital Author of the Year, the Baijiahao's Most Popular Author in the Technology Field, the 2019 Sogou Technology and Culture Author, and the 2021 Baijiahao Quarterly Influential Creator, he has won many awards, including the 2013 Sohu Best Industry Media Person, the 2015 China New Media Entrepreneurship Competition Beijing Third Place, the 2015 Guangmang Experience Award, the 2015 China New Media Entrepreneurship Competition Finals Third Place, and the 2018 Baidu Dynamic Annual Powerful Celebrity.