Chinese technology giant Xiaomi announced that it started preparations for smart electric vehicle production with a public statement to the Hong Kong Stock Exchange. It will invest 10 billion dollars for this.
With the ‘electrification’ of the sector and the transformation of the vehicle concept into ‘smart vehicle’, the attention of technology giants began to shift to the automotive sector. Chinese technology company Xiaomi’s desire to develop electric cars is also on the agenda for a while.
This issue, which has been on the agenda for a long time, has become official as of yesterday. The Chinese company announced that it has started preparations for smart electric vehicle production with a public statement to the Hong Kong Stock Exchange. According to the statement, it will operate under a wholly owned subsidiary of Xiaomi, with an initial investment of RMB 10 billion (Chinese Yuan) for electric vehicle production.
Xiaomi aims to invest a total of an estimated US $ 10 billion over the next 10 years. Lei Jun, Founder, President and CEO of Xiaomi, will also serve as CEO of the subsidiary for smart electric vehicle.
Lei Jun said, “We made this decision after numerous negotiations between all partners. This will be the last great entrepreneurship project of my life. I am ready to show off my personal reputation and put up all the challenge for our smart electric vehicle. Throughout the whole struggle for the success of the Xiaomi electric vehicle.” I am determined to lead my team, “he said.
Jun also highlighted that the Xiaomi management team has conducted very meticulous and extensive research in the past 75 days, including 85 meetings with more than 200 industry experts, four internal management discussions and two board meetings for the electric vehicle industry.
In a letter to its employees, Lei Jun underlined that Xiaomi has different and unique advantages in automobile production:
- Smart electric vehicles have radically changed the business model of the traditional automotive industry, and Xiaomi has detailed knowledge of the hardware-based internet service business model.
- Xiaomi has the most extensive experience in software and hardware integration and the deepest manufacturing know-how in the internet industry.
- It has the most comprehensive smart ecosystem in terms of Xiaomi’s product range, product scale and number of users.
- Xiaomi has a lot of basic technologies that can be applied to smart electric vehicles.
- Xiaomi has a strong brand and a strong user base with the trust and support of Mi fans around the world.
- It has abundant cash resources that allow Xiaomi to invest in this area with confidence.
“Smart electric vehicles represent one of the biggest business opportunities and an indispensable component of smart life in the next 10 years. We are expanding our smart AIoT ecosystem day by day and continuing our vision of ensuring that everyone in the world lives a good life with innovative technologies,” said Lei Jun. “It is a very natural decision for us to enter the electric vehicle sector.”
The strategy to be followed by the company in the automotive industry is not yet known. We will see in the following process whether it will only take on the software and technology side and leave the production to an experienced company or it will take over it itself. However, there have recently been reports that Xiaomi is in contact with the Great Wall Motor for electric vehicle production.