Shares of once-dominant smartphone maker BlackBerry (BB -0.29%), which has since reinvented itself as an Internet of Things company and a provider of automotive software, got a minuscule boost on some good news Tuesday. However, the stock gave up those gains and more in Wednesday morning trading. As of 11:20 a.m. EDT, BlackBerry was down by 4%.
Is that fair?
As was announced Tuesday, China's BiTECH Automotive has chosen to incorporate BlackBerry's QNX Neutrino Realtime Operating System into its digital instrument cluster -- the modern car's dashboard, with screens telling you how fast you're going and how much fuel you have left, and displaying your navigation information, multimedia controls, and such. Changan Automobile has picked BiTech's cluster to install in its new SUV, the UNI-K, which has already entered mass production.
All of which is very interesting, but it doesn't tell you much about how important the news is. To gauge that, you first have to know what kind of company Changan Automobile is, and how it's doing.
In that regard, a few numbers may help. Although it's hardly a household name in the U.S., according to data from CarSalesBase.com, Changan is a pretty sizable automaker in China, and it's growing rapidly. It sold nearly a million cars in 2020 -- 963,383 to be precise, up more than 22% from 2019.
Those aren't half bad sales numbers for the middle of a pandemic, and here's the thing: In the first four months of 2021, Changan Automobile doubled its sales versus the first four months of 2020 to nearly 467,000. Based on current trends, it's cruising toward selling a total of 1.4 million vehicles in 2021. If it hits that number, it will work out to 45% year-over-year sales growth.
That's twice the rate of growth Changan enjoyed last year. The traders selling BlackBerry stock Wednesday may not realize it yet, but to me, it looks like the tech company has picked the right partner to carry its software in China.