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The backstory: Lei Jun, the driving force behind Chinese electronics giant Xiaomi, co-founded the company in 2010, creating a buzz with the brand’s affordable smartphones. Over time, Xiaomi became the world's third-largest smartphone vendor, according to research firm IDC, while also expanding into smart home gadgets and wearables. Lei's strategic vision has also led Xiaomi into other territories. In 2021, he initiated Xiaomi's venture into the electric vehicle (EV) market, calling it the “last major entrepreneurial project” of his life. This year, Xiaomi revealed its new car models, the SU7, SU7 Pro and SU7 Max, sparking excitement in the market.
Looking at the bigger picture, China's EV market is seeing strong growth, and the country is a global leader in making electric cars. In the first 11 months of 2023, EV production shot up by just over 27%, hitting 8.05 million vehicles, according to data from the National Bureau of Statistics. In November, China set a new record by producing 1.01 million EVs.
The development: During a recent chat with China's state broadcaster, Lei said that Xiaomi had poured over 10 billion yuan (US$1.4 billion) and rallied a team of 3,400 engineers to cook up its first lineup of EVs. The 54-year-old entrepreneur shared that he drew inspiration from the legendary Steve Jobs, and he was ready to bring the cars to the market. Despite the high production cost of Xiaomi’s EVs, which cost 10 times the industry average to make, he's sure its EV lineup can compete with Elon Musk’s Tesla. Lei acknowledged some potential challenges, like people not being as excited about Xiaomi's cars in a competitive market. But he also said another worry is struggling to keep up production if there’s high demand for them. It could mean customers waiting longer, possibly 1-2 years, for their cars.
"I came into car building with an aim to win," Lei Jun, founder, chairman and CEO of Xiaomi, said in an interview with state-owned broadcaster CCTV. "We will fully respect the laws of the automotive industry, use mature technology and make sure we can do a good job with the first car. Under this premise, we innovate."
"While we did not encounter many positive external factors, the achievements we were still able to make demonstrate an improvement in our overall capabilities," said Xiaomi President Lu Weibing during an earnings call reporting a forecast-beating jump in third-quarter net income last month.
“Xiaomi wants to find a mature automobile manufacturer to provide model infrastructure, enabling its own advantages in mobile internet technology,” said Alan Kang, senior analyst at LMC Automotive, in 2021.