China's auto market has changed a lot in recent years, as internet companies join the battle, new electric vehicle (EV) makers gain ground, and traditional carmakers are busy getting digitalized.

Tencent, as the largest Chinese internet company by number of users, is also investing in the smart auto area.

But unlike Huawei's HarmonyOS smart solutions or Baidu's Apollo taxis, Tencent is approaching smart auto from the cloud. They announced their core concept "Vehicle-Cloud Integration" during a press release on Friday.

"Tencent perseveres not to be an automaker, but to support automakers to manufacture quality vehicles," said Dowson Tong, senior executive vice president of Tencent and CEO of the company's cloud and smart industry branch. "Tencent offers automobile industry an easy access to customizable platform and toolkits."

In addition to the strategy, Tencent also released a white paper with U.S. consulting company Gartner to talk about their vision in the future of smart auto.

In this vision, traditional carmakers are embracing digital transformation as more users want more internet and AI experiences in their cars. At the same time, governments in all major economies are pressuring companies to comply with stricter data security requirements.

With more digital tools, carmakers will feel more flexible making decisions, the white paper said.

"It is normal for a modern smart auto to generate five to six terabytes of data a day," said Liu Shuquan, vice president of Tencent Intelligent Mobility. "Sensors have multiplied in today's smart auto compared to previous solutions."