(Yicai Global) Nov. 16 --Chinese telecom giantHuawei Technologies will combine its smart car and consumer businesses after selling Honor,the budget smartphone brandthat helped make it the world’s second-biggest handset supplier last year.

Honor’s spinoff will leave a huge gap in the Shenzhen-based company’s consumer business, online tech news outlet 36Kr reported today, citing an auto industry specialist. Yu Chengdong, chief executive of Huawei’s consumer business group will lead the merged units, according to sources close to senior management, the report added.

The smart car and consumer business have already merged in terms of investment, insiders noted, according to 36Kr. One said “senior management are probably making plans for the eventual [fusion] of their business structures and logics.”

Founded in May last year, Huawei Smart Car Solutions falls under Huawei’s information and communications technology business, with rotating Chairman Xu Zhijun currently in charge. The unit focuses on smart driving, intelligent cockpit, intelligent electrification, connectivity and smart automobile cloud.

Last week, 36kr said Huawei plans to sell Honor for about CNY100 billion (USD15.1 billion) to a group that includes Digital China Group and three state-backed entities. Huawei introduced Honor in 2013, which helped build the firm’s market share among budget-conscious buyers. It became an independent business in April.

With the help of Honor, Huawei shipped 238.5 million phones last year, surpassing Apple to rank second globally, according to Counterpoint Research.

Huawei is reportedly under the gun to sell the brand to circumvent curbs the US commerce department has set on its access to chip-making technologies since September.

Huawei has three business groups and two business units: Carrier Network Business Group, Enterprise Business Group and Consumer Business Group, as well as its Cloud & AI Business Unit and Huawei Smart Car Solutions Business Unit.

Editor: Ben Armour