(Yicai Global) Feb. 10 -- The suspension of the executive in charge of Huawei Technologies’ intelligent automotive solution product line as well as its Huawei Inside segment, is a normal adjustment in personnel and does not signal a change in direction of the Chinese tech giant’s auto strategy, the chief executive officer of the Huawei Intelligent Automotive Solutions Business Unit told Yicai Global.

The shift in personnel will have no bearing on the future direction of Huawei’s smart car business and strategy, Richard Yu said.

Wang Jun, chief operations officer of the Huawei Intelligent Automotive Solutions BU, president of the intelligent driving solution product line as well as head of its Huawei Inside section, was removed from his post on Feb. 7.

The move has raised concerns among the public that his removal might have to do with the heavy losses being made by the firm's car business and that its auto strategy could now change. Yu dismissed these concerns as ‘online rumors.’

Huawei did not respond to questions about integration within the automotive business and who will replace Wang as president of the intelligent automotive solution product line.

Huawei’s auto business unit is divided into three sections. The first is Tier1, which provides self-driving parts to vehicle manufacturers. The second is Huawei Inside, which used to be headed by Wang, where Huawei equips partners such as BAIC ArcFox, Chang’an Avita and GAC with smart driving solutions without selling cars. The third is the smart selection model, led by Yu. Here, Huawei is partnering with carmaker Seres to develop the AITO model, which is sold in Huawei outlets and Huawei gets a share of the revenue.

Market observers are concerned that with the toppling of Wang, the smart selection model will now become the focus of Huawei’s car business and the Huawei Inside model will be marginalized.

The auto business unit is under huge pressure to start making money. Last year, Yu said the three-year-old unit is Huawei’s only loss-making segment and had racked up USD1.5 billion in research and development expenses that year alone. Last December, Yu said that the auto business unit must turn a profit by 2025.

Huawei Inside has become the Shenzhen-based company’s most important technology asset due to the huge investment, an insider from Avita told Yicai Global. Huawei will keep its current business operation mode, but future directions might change, he added.

Editor: Kim Taylor