Xiaomi Invests $10 billion in the Production of Electric Vehicles
Chinese smartphone brand Xiaomi has announced its entry into the car market. To do this, the tech giant plans to invest a massive $10 billion over the next decade.
The founders of the company made such an announcement during the presentation of the Xiaomi Mega Launch on March 29 in the online format simultaneously for different countries of the world. The large-scale event was the first open international event in the history of the Chinese smartphone giant.
For two days of a major announcement, the manufacturer not only presented a series of new phones and equipment, including a fitness bracelet Mi Band 6, a unique smartphone that has the first-ever bendable screen Mi Mix Fold, 5 Mi 11 smartphones, as well as several laptops from the Mi Notebook Pro series.
In addition, manufacturers made a lot of loud statements that not only surprised the public but also alerted the competitors of the technology market.
In an explanatory note to the announcement of the project, Xiaomi said that they are planning to create a subsidiary that will be wholly owned by the brand.
Leading the project for the automotive production series will be Lei Jun, the current CEO of Xiaomi. It is worth noting that according to Jun, this initiative with electric vehicles will be the last for the leader. After that, he is likely to retire and no longer plans to promote new projects.
Note that the amount that Lei Jun’s team is investing in the smart electric vehicle business has not consistently coincided. So initially in the source, the site said that the amount of the contribution to the business would be $100 million. But some experts and critics were discouraged and began to look for confirmation of these statements. Later, after a while, in an updated note, director Lei Jun himself denied this information:
“At the initial stage, 10 billion yuan will be invested in the development of the project, which is about $1.5 billion. The remaining $10 billion will be invested gradually over the next 10 years.”
Some car enthusiasts are already curious about an innovative development. Since the company itself has advertised its new project quite colorfully.
“The Xiaomi brand plans to produce smart cars with decent quality electric motors. This technique will enable everyone to start their comfortable and thoughtful life anywhere in the world, regardless of time and circumstances.”
Xiaomi’s competitors in the auto market will be such well-known brands as BYD, a 17-year-old auto brand headquartered in the Chinese city of Shenzhen, and car manufacturer Nio, which has been on the market for 7 years, as well as the leader of Chinese search engines Baidu.
According to the company Canalys, which produces large-scale research and forecasts in this area, the People’s Republic of China may sell about 2 million electric vehicles this year. This figure will be more than half that of 2020.
In the media, different versions of how the project will develop are still being sharpened. So, for example, Reuters reported that new cars from Xiaomi will be produced at the Great Wall plant, where they are engaged in the production of various equipment. However, the company itself did not confirm this information. Therefore, the exact data on how the unique Xiaomi car will look and where it will be created can only be speculated. And yet, another version has already appeared, according to which the brand can enter into cooperation with XPeng Motors, which has been a supplier of electric cars in China for 3 years.
But what exactly will be the target of Xiaomi’s smart car division is not yet clear. During the presentation, Xiaomi CEO Lei Jun mentioned his meeting with the great businessman, engineer, and Tesla President Elon Musk. In addition, he showed a model of their first electric car, in the form of a “home on wheels”, inside which there were many different developments of the brand.
Just like a year ago, the company has made the dreams of its three clients come true. However, there was no talk about the details of their new projects. It turns out Xiaomi has once again intrigued its customers. And without giving any specifics. This has already happened when in 2020 everyone played with a Suzuki Jimny radio-controlled machine.
Xiaomi is the third-largest manufacturer of smartphones in the world. In the Chinese market, it is presented with strong competition.
It is worth noting that the fashion for electric vehicles in China started when the Chinese government began to support such a program. Beijing officially has set up a series of programs to help citizens buy electric vehicles at a reasonable price. And also a subsidiary program was organized for those who could not afford the novelty of the technology. Also, not all parliamentary initiatives in this direction were approved. Independent experts predict an increase in the number of purchased cars in China by almost half.