Spotlight on Xiaomi EV to be introduced by H1 2024. Xiaomi’s CEO, Lei Jun, announced at China’s annual parliamentary gathering that the company’s EV unit will begin mass production in the first half of 2024, despite the highly competitive EV market in China. Xiaomi invested over 3 billion yuan in the EV venture in the previous year. Lei Jun, who is often compared to Steve Jobs, spends 50% of his time leading a team of over 2,300 people in the EV business. Xiaomi has not provided any further comment on the matter.
Spotlight on Xiaomi EV
Lei Jun is a co-founder and CEO of Xiaomi, a smartphone brand that he grew through direct-to-consumer online sales and cutthroat pricing to become one of China’s leading tech magnates. He once aimed to beat Apple in three years to become the world’s top smartphone brand by sales volume.
Xiaomi’s entrance into the EV industry is an opportunity to compete with Apple in a new arena, but the company faces stiff competition from domestic rivals like BYD, Xpeng Motors, and Li Auto, as well as US EV giant Tesla, which already has a significant market share in China. The Chinese government is prioritizing self-reliance in key technologies, including EVs, as part of its domestic policy to compete with the US. Lei made the announcement about Xiaomi’s EV unit during China’s annual “two sessions”, where officials discussed the importance of boosting self-reliance in key technologies. Xiaomi declined to comment on the matter.
EV Industry in China
China is making strides in the electric vehicle (EV) industry and is currently competing with Tesla on both technology and pricing. This has attracted other tech companies to venture into the market, such as Baidu and Huawei, who have developed their own software solutions for vehicles. According to a UBS forecast, the electric car market in China is expected to boom, with three out of five new cars being electric by 2030. Xiaomi’s CEO, Lei Jun, announced that the company’s EV unit will begin mass production in the first half of 2024. He also mentioned that Xiaomi has invested over 3 billion yuan in its EV venture and that he spends half of his time leading the team of more than 2,300 people working on the project. Lei acknowledged the tough competition in the domestic EV market, with start-ups like Xpeng Motors and Li Auto already vying for market share alongside established players like BYD and Tesla.
Xiaomi has established its electric vehicle factory in Beijing’s Yizhuang economic development zone, where many of the country’s top manufacturing companies, including Semiconductor Manufacturing International Corp and Naura Technology Group, have set up facilities. However, despite the increasing market in China, Xiaomi’s foray into the EV market is not a certain success. The market is crowded, and the EV sales growth in mainland China is predicted to slow to 30% year on year in 2023, a considerable drop from the 114% sales surge last year, according to the China Passenger Car Association. Xiaomi is venturing into a difficult new product area while its smartphone business is struggling due to a market downturn. China’s total smartphone shipments dropped 14% year on year to 287 million units in 2022, falling below 300 million for the first time since 2013. IDC reports that Xiaomi’s global shipments decreased nearly 20% last year.
In the three months ending on September 30th, Xiaomi, which holds 13 percent of the smartphone market share by shipments, experienced a 9.7 percent year-on-year drop in revenue to 70.5 billion yuan, while its net profit declined by 59.1 percent to 2.1 billion yuan.
source: South China Morning Post
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