Xiaomi co-founder and CEO, Lei Jun has recently shared an update on its plans for electric vehicle production in its home country China. Addressing China’s annual parliamentary gathering as a National People’s Congress (NPC) delegate on Sunday, Jun said that Xiaomi will start the mass production of its EVs in the first half of 2024. With that, the first-ever Xiaomi electric car is set to enter the EV market at a time when all the automobile bigwigs, as well as new startups, will have their presence in the Chinese EV market.
In his address to the gathering, Jun also mentioned how the EV business is now his prime focus at Xiaomi and that he spends half of his time on it. Since it announced its plans to manufacture and sell EVs last year, Xiaomi has invested over 3 billion yuan (US$434.3 million) in the new business segment, while more than 2,300 Xiaomi employees are currently working on the project. Xiaomi announced a total of 10 billion yuan as a seed fund for the business at its inception last year. These funds are to be spent in stages over the next decade.
Jun shared another interesting update on the production of the car. As mentioned in a report by South China Morning Post, Jun said that Xiaomi’s EV manufacturing “has progressed beyond expectation,” as it recently completed the winter testing for the electric car successfully.
Xiaomi created a major upheaval in the global EV industry with its decision to produce EVs last year. Being one of the largest consumer electronics manufacturers in the world, Xiaomi’s foray into EVs was a blaring sign for other tech giants to initiate similar interests for their own brands. Apple, for instance, has been working on its own electric car for long and is expected to start selling it later this decade.
While the EV demand is high, Xiaomi’s entry into EVs may not be easy in its home market. As highlighted in the report, China’s EV market is already flooded with both giant automobile manufacturers like BYD and Tesla, as well as start-ups like Xpeng Motors and Li Auto. Xiaomi will thus have to face fierce competition by the time it manages to roll out its first-ever EV to the customers.
Simultaneously, estimates indicate that the Chinese EV market is also headed towards saturation and sales might be slashed within this year, keeping in mind the sales growth seen in the bygone years. By 2030, China is expected to have every three out of five cars on the road to be powered by batteries. With that, it remains to be seen how big a role is Xiaomi going to play with its new venture.