OverdriveApr 01, 2021 12:27:28 IST
Xiaomi, the world’s third-largest smartphone maker, has announced it will set up a new business aimed at making electric cars. The firm is expected to make its debut in the Chinese market, and in a regulatory filing shared with the Hong Kong Stock Exchange, the tech firm said it will invest USD 10 billion in the business over the next 10 years with an initial investment of USD 1.52 billion. The Xiaomi electric car business will be led by the firm’s CEO, Lei Jun.
With this move, Xiaomi joins a trove of new players in the Chinese EV space, all aimed at taking a piece of the world’s largest and fastest-growing EV market. The most notable new start-ups have been Nio and Xpeng along with the many homegrown Chinese carmakers like BYD and Geely. This move is also in line with a new trend of tech firms showing interest in the EV market, given the obvious synergies in materials and tech. The most notable of these have been Alibaba (in collaboration with SAIC) and Baidu. On a global scale, Apple has a strong plan in place for electric vehicles along with more than a passing interest from Sony and Dyson.
Xiaomi says its decision to enter the EV business comes with the completely different business model that EVs allow. The company will be able to apply its experience in software and hardware integration along with its large ecosystem of products and tech to the EV space, given the increasing demand for connectivity in the auto world.
Reports suggest Xiaomi will use Great Wall Motor’s factory and engineering know-how to build its EVs, which will be positioned towards the mass market in keeping with the brand’s target audience. Little is known about the venture apart from this as of now, but with Xiaomi’s strong presence in the Indian market and GWM’s upcoming India foray (still on hold), the possibility of seeing Xiaomi’s EVs on our roads eventually can’t be ruled out.