United States could force the PSA Group to break with Huawei

Three months ago, the 50/50 merger between Fiat Chrysler (FCA) and the PSA Group was finalized; an agreement of 50,000 million dollars that will create the fourth manufacturer worldwide, without sacrificing brands. At the moment, regulators from dozens of countries, including the United States, are studying the agreement, but there could be a stumbling block.

US President, Donald Trump

The French group partnered with Huawei in 2017, one of Donald Trump’s main enemies and guest of honor on his blacklist.

In recent statements to Reuters by the CEO of the PSA Group, Carlos Tavares, he wanted to calm the waters by ensuring that his Huawei relationship could be revised. “We have a partnership with Huawei, which is linked to another association with the French telecommunications company Orange, we are not directly related to them,” he said.

When 15 days had passed since the acquisition of Opel / Vauhall by the PSA Group, the association with the Chinese telecommunications giant Huawei for the development of software for connected cars was announced.

The objective? To include in the vehicles of the brand a new platform that ensures that all digital interactions between the car and cloud are managed safely.

A platform that will enable the introduction of new services, such as remote car diagnostics and remote control solutions, such as battery charging, traffic and navigation information; car sharing, corporate fleet management and personalized on-board services as personal assistant solutions.

This system has been implemented in six million vehicles in Europe and China (the first was the DS7 Crossback), according to Reuters data.

In fact, Peugeot’s flagship in the Chinese market, the 508L, premiered Huawei’s IoT OceanConnect connectivity platform .

In May 2019, Google, due to pressure from the United States Government, decided to veto Huawei, and therefore, expel it from the Android operating system.

Trump claimed that the United States could not allow any other nation to compete for the hegemony of 5G , as American national security and its prosperity is at stake, he said.

This is where 5G and multiplied hatred of China come into play: Huawei Technologies is currently the company – based in Shenzhen, China – that has contributed the most technical contributions to the 5G standard, closely followed by Ericsson (Swedish), Hisilicon ( China), Nokia (Finnish), Qualcomm (US) and Samsung Electronics (South Korean), according to data from statista.com, IPlytics GmbH and Eurasia Group collected by El País .

Now that PSA and FCA are on their way to the altar surrounded by the regulatory bodies of 24 countries, they must be cautious. Without the United States, the agreement will not be implemented, since Washington is urging its European allies to exclude Huawei from the telecommunications infrastructure of the continent.

France, for the moment, has refused.

PSA CEO, Carlos Tavares

But Tavares has said in statements collected by Reuters that they will adjust their association with the Chinese giant if the US authorities make it a precondition.

We will see how this ends.

Contact the author: warrenfrank@wheelsjoint.com

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