Chinese smartphone maker Xiaomi is currently preparing to make its own electric cars and could launch the venture as soon as April, according to Chinese media outlet 36Kr, citing investors close to the company.
The company is aggressively advancing the venture, which is led by Xiaomi co-founder and chief strategy officer Wang Chuan, sources told 36Kr. The project is said to have similar brand positioning to Guangzhou-based XPeng, which is catered towards younger Chinese buyers in the mid-to-high-end market.
Wang, a long time business partner and friend of Xiaomi CEO and Founder Lei Jun, joined the company in 2012 and has previously led its TV division, staffing, China region, and large home appliances business, also heading up product R&D, production and sales channels.
Lei reportedly met with Li Bin, founder and CEO of electric car startup NIO in late February to consult each other on car manufacturing matters.
Xiaomi has also been on the hunt for a manufacturing partner, and had held talks with German-Chinese automaker Borgward and electric pickup truck maker Kaiyun Motors. Sources told 36Kr that Xiaomi had also reached out to Shenzhen-based BYD, but encountered concerns about investments and decision making if they were to team up.
When contacted by Pandaily, Xiaomi referred to its previous statement: “Xiaomi has been paying attention to the developments in the electric vehicle industry, and has continuously studied the relevant industry trends. Xiaomi has not initiated any formal project regarding the study of electric vehicle manufacturing business.”
On Monday, a US court granted a preliminary injunction against a pending government ban which had threatened to restrict investment in Xiaomi, which had been designated as a “Communist Chinese military company” by the Department of Defense. Hong Kong-listed Xiaomi surged from 22.75 HKD ($2.93) to 24.45 HKD ($3.15) in the wake of the news.
Sources told 36Kr that car manufacturing has always been an important “Plan B” for Xiaomi amid a period of stagnant growth across the global smartphone industry, regardless of the US blacklisting.
Rumors of Xiaomi’s potential foray into the electric car industry first surfaced in mid-February.
Since his two 2013 visits to meet with Tesla CEO Elon Musk in the US, Lei has toyed with the idea of auto manufacturing. Xiaomi’s venture capital arm Shunwei Capital invested in EV start-up NIO in 2015, as well as in XPeng in 2016 and 2019.
According to documents published on the National Patent Office website, Xiaomi has filed a list of patent applications including cruise control, navigation, assisted driving and other car-oriented technologies since 2015, LatePost reported.
Xiaomi’s Xiaoai virtual assistant system has already been implemented via a range of strategic cooperations, including in Mercedes-Benz vehicles and FAW Group’s special-edition model of the Bestune T77 crossover.
In June 2020, the company registered a Chinese trademark that roughly translates as “Xiaomi car alliance” and related graphic trademarks.
Beijing-based Xiaomi overtook Apple to become the third largest smartphone maker in Q3 2020, shipping 46.2 million devices amounting to a market share of 13%, according to data provider Counterpoint Research.
Xiaomi’s potential new venture does not come as a surprise to many — it follows in the footsteps of fellow tech giants such as Baidu, Alibaba, Tencent and Huawei in its entrance to the world’s largest auto market, the Chinese mainland.