During this year's "two sessions", the principle of accelerating self-reliance and self-improvement in science and technology to promote high-quality development, has been stressed. Meanwhile, according to the 2023 Government Work Report, as spending on R&D increased from 2.1% to over 2.5% of GDP, the contribution of scientific and technological progress to economic growth exceeded 60 percent in 2022.
Against the backdrop of the new era, enterprises in all fields have mushroomed and taken the leads in the global markets bolstered up by top-notch technologies and innovative spirits, showcasing the national strategy driven by innovation and technology. Among them, there are large-scale companies that rose from traditional business and keep self-evolved through these decades, as well as start-ups born to embrace innovation and globalization.
EqualOcean's new interview column themed as "Technological Innovation, Leading the World" will focus on start-ups, characterized as innovative technology and product, global competitiveness and global layout, in the advanced manufacturing, new energy, consumer technology, and digitization fields. Through close-up observation of the R&D processes and the global vision of their core management, this series aims to display the new looks and opportunities of China's technology and innovation companies. In this article, EqualOcean conducted a dialogue with Chu Yongyan（Chineses：楚詠焱）, founder of Chuhang Technology（Chinese: 楚航科技）, a leading millimeter-wave radar company.
EqualOcean: Can you introduce the recent product development of Chuhang Technology?
Chu Yongyan: Our millimeter-wave (MMW) radar has been in mass production since 2020, supplying to car manufacturers such as GWM, DFPV, Chery, BAIHC, SAIC, and Yutong. From 2022, we started to focus on product upgrades, developing towards multi-channel, high-resolution 4D imaging millimeter-wave radars with 4 transmitters and 4 receivers, 6 transmitters and 8 receivers, 12 transmitters and 16 receivers, etc. This year, several forward-looking radars will be shipped on new models of emerging car companies such as Zeropark.
In addition to the core products, we have also carried out differentiated development. For example, we have launched blind spot monitoring radar and live detection radar for commercial vehicles in response to the EU's mandatory installation regulations UN ECE R151 and R159. Chuhang Technology is a leader in these fields.
In 2023 Shanghai International Automotive Industry Exhibition, the stealth radar ART was debuted for the first time. This radar adopts a flexible layout and conformal design, with the ability to measure large angles and a lightweight grid structure. It has the potential to redefine the physical form of MMW radar for vehicles and overtake companies abroad.
Based on the vehicle-mounted MMW radar, we have also developed some system integration solutions. By using perception-integrated technology and other types of sensors, we can increase the overall completeness of the solution. In the future, we will advance from a sensor supplier to a perception map supplier.
EqualOcean: What breakthroughs has Chuhang Technology made in mass production?
Chu Yongyan: Firstly, we have built our own factory in Anqing, Anhui Province, with an annual production capacity of 1.8 million units. Recently, we initiated a project to expand the base and expect to build 8 to 12 production lines.
In addition, our industrial park in Anting, Shanghai is also expected to be finished in construction in early May and put into use by the end of 2023. The first phase is equipped with two fully automated production lines, and another ten will be added later, with an annual production capacity reaching 5 million units.
EqualOcean: What was the original intention and opportunity for founding Chuhang Technology? Why did you choose MMW radar as the direction?
Chu Yongyan: Our founding team has abundant work experience in the automotive industry. CTO Zhang Wugong and I used to work at Bosch in Germany for more than 10 years, specializing in vehicle controllers and sensors.
Unlike the innovation model of the Internet, we believe that the best way to start a hard-tech business is to "do what you know": if it is not a product or field that you are familiar with, there will be many unexpected "traps". Therefore, we regard the know-how of radar as our greatest asset.
Around 2017, after noticing the booming automotive industry in China and the rising of domestic brands, we believed that domestic core components should have a potential market, so we decided to come back to China to start a business.
MMW radar before the 77GHz frequency was one of the bottlenecks in China. We hope to apply our knowledge and experience in the automotive industry and radar technology and contribute to the global development of China's automotive industry.
EqualOcean: How did Chuhang Technology achieve breakthroughs in mass production within a short time?
Chu Yongyan: Generally speaking, it takes about 5 years to produce a Bosch radar from R&D to SOP. Since we were already familiar with the industry, product, and system, we parallelized some steps in the R&D process and avoided some detours, to shorten the overall cycle. Nevertheless, we still went through a pure 2-year R&D phase without any output.
The supply chain of MMW radar is relatively complex for some components, including antennas, high-frequency materials, chips, etc., have long been monopolized by foreign countries. That poses a considerable challenge to the overall cost. So we have also coordinated a lot of upstream and downstream resources.
But we believe that most industries are driven by downstream development. When we achieve domestication of modules and can compete with international manufacturers, we will gradually drive some upstream enterprises to embark on the road to self-reliance.
EqualOcean: What are the different pain points of the demand for MMW radar in passenger cars and commercial vehicles? How did Chuhang Technology tackle them respectively?
Chu Yongyan: We have more cases in the passenger car field, most of which are connected with OEMs, so the customer's needs can be imported into our product development for adaptation.
For commercial vehicle, the new functions and applications should obey legal requirements, so the OEMs prefer suppliers who can provide integrated solutions. For example, forward collision avoidance and AD require the radar and cameras, so we need to cooperate with some system integrators as a Tier 2 supplier to import them into the OEMs. In this field, we have established a joint venture with BaoLong Technology, leveraging its experience and channel resources in the commercial vehicle field to iterate products and open up the market.
At the same time, the overall market of the commercial vehicles is not very large, and the product's requirements are different from those of passenger cars. It will involve some special scenarios, but in some other applications where passenger cars require higher demands, the fault tolerance is relatively higher.
EqualOcean: In which application scenarios will Chuhang Technology pursue breakthroughs in the future?
Chu Yongyan: As a reliable sensor, radar can be used in various fields. We chose the automobile as the entry point, first because we are very familiar with this field, and secondly, the demand for automobiles is the largest, and also the one with the highest requirements for software and hardware. The hardware of vehicle-grade needs to meet multiple requirements such as reliability, consistency, algorithm robustness, and system construction. When the vehicle-grade radar expands to other scenarios, we don't have to worry about quality, and the overall cost is more controllable when the supply is guaranteed.
The scenarios we want to extend to in the future are first of all the intelligent driving of electric motorcycles, as well as smart traffic at the roadside. In addition, we also plan to expand some algorithms, such as live detection, to smart buildings.
But there is one condition for our expansion, which is to find scenarios that are easy to platform. We are not interested in being a system integrator but rather prefer to provide reliable sensors to enable integrators to better adapt to various applications. Although the profit margin is relatively thin, the investment pressure is also relatively small.
EqualOcean: What are the main responsibilities of the German subsidiary? Is Europe the preferred destination for Chuhang Technology's expansion?
Chu Yongyan: Our subsidiary in Stuttgart is mainly responsible for two tasks: first, to connect with European technical experts and teams, supporting the development of new technologies, products, and processes; second, to communicate with European customers. We have entered the supply chain of a well-known German automaker and are currently connecting with its next-generation radar platform, which is expected to be put into mass production around 2027.
The founders have lived in Germany for more than ten years and have a good understanding of the entire market. We also have some inherent advantages in language, making it easier to gain recognition from local customers. After completing the development of the European market, we plan to promote our products in other regions through local partners or agents.
EqualOcean: What are the core competitiveness of Chuhang Technology compared to giants such as Bosch?
Chu Yongyan: First, our positioning and target market are different from Bosch. Bosch is a system supplier, providing not only radar but also cameras and ESP, with a focus on large-scale production and serving big customers.
Chuhang Technology focuses on radar products. In order to better meet the needs of autonomous driving and seamlessly integrate with customers' systems, we provide more customized and personalized services at reasonable prices, including providing some raw data to the automakers.
Besides, certain differences also lie in the automotive industries between China and Europe. Although German automakers have multiple sub-brands, different models may share the same platform, chassis, and radar, such as MQB and MEB. However, Chinese automakers' platforms are more dispersed, leading to more diverse needs for radar. In this circumstance, our adaptation services will have more advantages.
EqualOcean: What challenges does Chuhang Technology expect to face in terms of brand and sale globalization?
Chu Yongyan: Chuhang Technology positions itself as a China-based global brand combined with Chinese speed and German quality. We first need to take small steps and run fast in terms of product performance and quality, gradually catching up with and surpassing international brands.
At the same time, we closely follow the footsteps of international giants in the direction of technological iteration and have laid out the R&D of the 6th generation radar. As a startup, we have significant flexibility. On the one hand, thanks to our team's understanding of the industry and products, we can make some advance predictions and innovative attempts, which may lead to commercialization landing and form international competitiveness ahead of time. On the other hand, if a certain direction is not feasible, we can immediately turn around.
There will be regional protection policies in various markets, but I believe that the direction of technological evolution is consistent, and there must be commonalities between different markets. Even if there are obstacles to mobility, complete isolation is unlikely. What we need to do is to learn from each other in benign competition and seize opportunities.
Not only radar, but we also believe that domestic chips have the opportunity to go global. If the European and American markets are relatively closed, we can start with emerging markets such as Southeast Asia, Central Europe, and Central Asia and gradually expand. Vinfast, which has been quite active in the global automotive industry recently, will use the radar supplied by our joint venture BaoLong, and the chip made in China for its next model.
This year, we are optimistic about the export market, and our products have been certified in more than 30 countries. Taking our customer Chery as an example, Chery exported 450,000 vehicles last year and is expected to increase steadily to 600,000 vehicles or even more this year, which will bring us a large number of orders. In the export, our commercial vehicle corner radar and live detection radar are in high demand by regulations and have higher profit margins overseas.
EqualOcean: What are the opportunities for intelligent automotive parts manufacturers in 2023?
Chu Yongyan: Despite the uncertainties in the automotive market in 2023, the trend towards electrification, intelligence, and a return to rational cost control is certain. Parts manufacturers still face important opportunities and need to adjust themselves according to market rhythms, adapt to market demand, and reasonably control costs while continuously optimizing the supply chain.
One of the most important cost-cutting measures in the automotive industry is scaling up. We began mass production in 2021 and completed a batch of sales conversions in 2022. During this process, we invested a lot of energy to ensure that quality is maintained while scaling up production, and to promote the landing of the next generation of products. This also reflects the common evolution law of the automotive industry.
Overall, 2023 is a crucial year, and we need to ensure smooth connections between quality, volume, and new and old products.
EqualOcean: Tesla will install 4D MMW radar on its high-end models, what does this mean for Chuhang Technology?
Chu Yongyan: This has a significant impact on us. For non-professionals, Tesla is somewhat of an industry barometer. So when Tesla says they don't need radar, radar may really lose its value in the field of autonomous driving.
In fact, industry experts generally recognize the necessity of radar. Radar is the only sensor that is available all day in spite of rainy and foggy environments. In terms of speed measurement, MMW radar is more accurate and convenient than visual and lidar solutions.
When Tesla announced that they would give up radar, I predicted that they would eventually put radar back on, with their own radar. The fact is, radar is an indispensable sensor.
After the incident, the automotive industry paid attention to MMW radar companies. On the one hand, this is a good news that drives the industry towards a more rational direction. On the other hand, it does cause some disturbance to the competitive landscape. But I believe the market has its own regulatory mechanisms, and as long as we follow market rules and focus on product quality, we will eventually get the corresponding return.
Finally, I want to say that the Hard & Core Technology technology field needs more entrepreneurs and professionals with passion and awe. Only by working together can we push the industry forward.
About Chuhang Technology
Chuhang Technology is a startup which is established in 2018, by a team previously based in Germany. The company dedicates to the development and production of 77 GHz to 79 GHz millimeter-wave (MMW) radar sensors for Advanced Driving Assistance Systems (ADAS) and Automated Driving (AD) applications. The company's latest automotive radar is launched with the highest level of technological development as well as the industrial process of 77 GHz MMW radars. The radar has been delivered to passenger cars and truck/bus manufacturers, which helps to implement the ADAS functions such as Blind Spot Detection System (BSD), Forward Collision Warning (FCW), Adaptive Cruise Control (ACC), and Automatic Emergency Braking (AEB).
Chuhang Technology has completed its B++ round of financing. Its headquarter is located in Nanjing, and it has established subsidiaries in Stuttgart, Germany, and Shanghai. It also has a radar production base in Anqing with an annual production capacity of 1.8 million units. This production base has been certified with the IATF16949 quality system, the ISO14001 environmental management system, and the ISO45001 occupational health and safety management system. Meanwhile, Chuhang Technology's industrial park in Shanghai, which integrates R&D, production and manufacturing, marketing, and service, is to be put into operation by the end of 2023. Its annual production capacity will reach 5 million units and will be used to connect with more automotive-grade and consumer-grade platform projects. Chuhang Technology is the first MMW radar enterprise in China where Hella invested and cooperated. It has also established a joint venture company with Baolong, deepening its cultivation in the field of automated driving.