A joint venture between General Motors, Chinese automaker SAIC, and connected car startup PATEO has filed a formal complaint against Tencent for using illegal, anti-competitive tactics to bully its rivals.
Why it matters: The complaint, currently under review by local authorities, marks the first time Chinese auto players have cited anticompetitive practices in a complaint about domestic tech giants that are fighting for share in the automotive sector.
- This could lead to another investigation into Tencent over antitrust behaviors amid Beijing’s clampdown on monopolistic practices.
Details: Chinese connected car company PATEO on Tuesday said it has filed a complaint against Tencent, alleging the company pressured automakers to stop using its software which connects smartphones to the in-car system. The app enables users to send and receive messages using WeChat.
- SAIC-GM-Wuling, a joint venture between General Motors, China’s biggest automaker SAIC, and others, collectively filed the complaint with PATEO.
- Previously, the in-car service platform had been installed on Baojun RS-3, an entry-level crossover launched in late 2019 by SAIC-GM-Wuling.
- Tencent in August sent letters to automakers including SAIC-GM-Wuling demanding that they end licensing the software for which there was no legal cause, PATEO said in a company statement. It said that Tencent has used its dominance and market monopoly to snuff out competition.
- The Xiaomi-based car connectivity startup also said it has sued Tencent for patent infringement, demanding that the Chinese social media and gaming firm pay RMB 80 million (around $12.4 million) for using patented technology in Tencent’s mapping service.
- Tencent responded on Tuesday in an announcement (in Chinese), saying that the in-car platform gathered private data without authorization from Tencent and users.
- Tencent had filed a suit in September against PATEO alleging unfair competition and trademark infringement in Shenzhen, the company said.
- GM did not respond to TechNode’s request for comment.
Context: PATEO is one of the major players of providing car connectivity software backed by a list of Chinese auto and internet giants. It was also reportedly in talks with Tencent’s rival Bytedance in May about a partnership on in-car software.
- The Shanghai-based startup last year raised a Series B for an undisclosed amount from investors including Nissan’s manufacturing partner Dongfeng Motor and domestic smartphone maker Xiaomi, Chinese media reported.
- Chinese retail giant Suning, as well as Haier Capital, the investment arm of Chinese electronics and home appliances maker Haier Group, were also among its early investors.