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Xiaomi to make smart electric vehicles, announces $10 billion investment

Xiaomi to make smart electric vehicles, announces $10 billion investment

Mar 31, 2021
12:13 am

What's the story

Chinese tech giant Xiaomi has announced its entry into the automotive industry. According to an official filing with the Hong Kong Stock Exchange, the company will set up a "wholly-owned subsidiary" to commence and operate a new smart electric vehicle business. Lei Jun, the co-founder and CEO of the Xiaomi Group, will concurrently serve as the CEO of the EV business.

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Take a look at the official statement

Goal

The company aims to offer quality smart EVs

As per the stock exchange filing, Xiaomi "hopes to offer quality smart electric vehicles to let everyone in the world enjoy smart living anytime, anywhere." It is unclear whether the company will produce and sell EVs under its own wings or tie up with contract manufacturers for producing the vehicles. We also do not know if Xiaomi will focus on manufacturing, software, or both.

Information

Xiaomi will initially invest 10 billion yuan

Xiaomi has confirmed that it will initially invest CNY 10 billion ($1.52 billion) into the smart electric vehicles venture. Over the next 10 years, the total investment amount will reach around $10 billion.

Brand recognition

Global brand identity will prove to be a key advantage

Xiaomi, often touted as an "internet firm," is known world over for its Android-powered smartphones, wearables, lifestyle products, IoT devices, and laptops. The tech giant's global recognition will prove to be an obvious advantage to market its electric vehicles as well as offer a connected driving experience using its established ecosystem.

Competitors

Xiaomi will face competition from established auto giants

The EV industry is slated to become a $5 trillion market opportunity over the next 10 years. Xiaomi will face competition from Tesla, Volkswagen, BMW, General Motors, and Jaguar Land Rover - they have been working for years to develop and sell electric vehicles. Back home, Xiaomi will take on rivals like Xpeng, Nio and Li Auto, which have already introduced multiple models.