It looks like another tech giant, Xiaomi, will be entering the electric vehicle business.
Late last year, it was strongly rumoured that Apple would be finally joining the automotive industry through an existing partner. First, it was thought that Hyundai might be this partner, or maybe even Kia. Later on, it looked like Nissan might be the one. In the end, the rumours just died down and the industry went on the way it had before.
Now, we have something a lot more concrete than rumours, but it’s not from Apple, it’s from Xiaomi, the Chinese tech company. Earlier today, Xiaomi issued an official statement to its shareholders that the company would be entering the ‘Smart Electric Vehicle’ business.
Why was the word ‘Smart’ put in there? Most likely because Xiaomi’s business model revolves around seamlessly integrating their family of products. Walk into a physical Xiaomi store and you’ll find robot vacuum cleaners, WiFi-enabled rice cookers and the like – all engineered to work best with other Xiaomi devices.
A smart electric vehicle would be the natural extension of this concept. A potential Xiaomi phone customer who bought a Xiaomi car would have a couple of extra features enabled. That sort of idea is pretty plausible in Xiaomi’s world.
How Xiaomi will go about starting a car business is still vague. All we know is that the company will be starting a new subsidiary and investing RMB10 billion (US$1.52 billion approx) initially. Everything else is mostly speculation at this point.
It’s possible they may use the Geely-Foxconn platform to contract manufacture their future EVs, as this would reduce startup costs of building factories and establishing supply relations. We’ll have to wait and see.
Here’s the press release with more.
PRESS RELEASE
This announcement is made by Xiaomi Corporation (the “Company”, together with its subsidiaries, the “Group”) on a voluntary basis to inform the shareholders of the Company and potential investors of the latest business development of the Group.
Reference is made to the announcement of the Company dated February 21, 2021.
The board of directors of the Company has resolved to commence the smart electric vehicle business. The Company will set up a wholly-owned subsidiary to operate the smart electric vehicle business. The initial phase of investment will be RMB10 billion. Mr. Lei Jun, the Chief Executive Officer of the Group, will concurrently serve as the Chief Executive Officer of the smart electric vehicle business.
Xiaomi hopes to offer quality smart electric vehicles to let everyone in the world enjoy smart living anytime, anywhere.
Shareholders and prospective investors are advices to exercise caution when dealing in the shared and other securities of the Company.
By order of the Board
