Xiaomi forays into the electric vehicle business with a $10 billion subsidiary
- Xiaomi, the Chinese smartphone maker, announced its plans to enter the electric vehicle (EV) business with an investment outlay of $10 billion.
- While finer details of Xiaomi’s EV plans are not known yet, reports suggest that it could partner with China’s Great Wall Motor Company.
- Xiaomi CEO Lei Jun will also serve as the CEO of the EV subsidiary.
AdvertisementAfter smartphones, laptops and other consumer electronic products, Chinese tech giant Xiaomi has announced its entry into the electric vehicle business.
The smartphone maker announced that it will set up a wholly-owned subsidiary with an initial investment of RMB 10 billion (approx. $1.5 billion). Over the course of the next 10 years, Xiaomi projects its investment to reach $10 billion.
Xiaomi’s chief executive Lei Jun will head the electric vehicle (EV) business, the company noted in its exchange filing. During the announcement, Jun also said that this will be his ‘final major entrepreneurial project’.
A Reuters report earlier said that Xiaomi is in talks with China’s Great Wall Motor (GWM) Company to manufacture EVs. According to the report, Xiaomi could use one of GWM’s manufacturing plants to make EVs under its own brand.
Xiaomi not alone in its EV ambitions
Xiaomi is not alone in branching out to the electric vehicle business. Chinese search engine giant Baidu is also reportedly planning its entry in the EV business in partnership with domestic car maker Geely Automobile Holdings.
Huawei, another Chinese tech giant, is also reportedly planning to launch its electric vehicles as soon as later this year. The company is said to be in talks with the government-owned Changan Automobile and other car makers to use their manufacturing facilities.
Apple, too, has been reportedly planning to enter the EV business for years now. A CNBC report from February states that the Cupertino-based company is in talks with Hyundai-Kia, suggesting that the Apple Car could be closer to reality now.
From nowhere to selling millions of phones every year
Xiaomi, co-founded in 2010 by Lei Jun and six others, started from nowhere in 2010 to selling millions of smartphones every year. According to the company’s latest financial results, its global smartphone shipments crossed 146 million, helping it land in the top 3 worldwide.
AdvertisementApart from this, Xiaomi also claims that it has nearly 325 million smart connected devices on the company’s Artificial Intelligence of Things platform – a combination of artificial intelligence (AI) and Internet of Things (IoT).
Having its own smart ecosystem could help Xiaomi complement its smart mobility plans, allowing its users to seamlessly connect various products across the Xiaomi ecosystem.
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