Tech

What to Expect from Xiaomi’s Entry into the Electric Vehicle Market

On August 24, it was reported in the market that Xiaomi has obtained the approval from relevant departments to produce electric vehicles (EV), which means that the mass production and launch in 2024 that Xiaomi has been emphasizing has already met the basic conditions. The reporter asked Xiaomi about this, but the company continued to remain silent and made it clear to the reporter that it “does not respond.”

Before the release of this news, there are still many developments that have been paid attention to by the market in recent days. Including Xiaomi’s registration and filing of the “xiaomiev.com” website domain name, and the recent recruitment of workers by the Xiaomi car factory.

It’s just that what Xiaomi is facing will be a more intensely competitive market. Baidu’s Jidu Automobile has recently changed its name to Jiyue, and its first model is expected to be released in the second half of this year; coupled with Tesla’s price cuts, and the recent sales of the new force “Wei Xiaoli”… With Xiaomi’s upcoming entry, China’s new energy vehicles are competing The pattern will inevitably face a new interpretation.

silent mode

On August 24, the news that “Xiaomi has been approved by China’s national planning department to produce electric vehicles (EV)” spread like wildfire. If true, this marks an important step towards the company’s goal of “producing cars early next year”. In one step, Lei Jun’s “last battle” of entrepreneurship will also set up an important milestone.

Automobile production qualification is one of the most concerned topics both outside and inside since Xiaomi announced its car manufacturing. Especially as Xiaomi’s Beijing Yizhuang factory conducts vehicle testing, the issue of “admission tickets” for automobile production qualifications needs to be resolved urgently.

Previously, the industry generally believed that Xiaomi might take over Beijing Baowo’s car-making qualifications, but this speculation has never been confirmed by Xiaomi. In June of this year, Beijing Baowo Automobile applied for the cancellation of its automobile production qualification, which meant that Xiaomi could not directly obtain cooperation in terms of qualification from Baowo, and topics related to the acquisition channel of Xiaomi’s car manufacturing qualification also sparked discussions again. Although there are different opinions, what is certain is that Xiaomi’s car-making qualifications need to “climb to new branches” and find another way out.

On August 14th, Lei Jun completed his annual speech on the theme of “growth”, which was originally a great opportunity to promote car building. But what exceeded market expectations was that Lei Jun kept silent about the progress of Xiaomi’s car manufacturing.

It has been two and a half years since the official announcement of Xiaomi’s car building in March 2021. Most of the incidents of Xiaomi’s cars have been covered with a veil of mystery, and the “silent mode” has been turned on.

As the “official mass production in the first half of 2024” is approaching, news about the latest progress of Xiaomi cars continues to flow out. Every news can quickly satisfy the appetite of the market. According to the reporter’s combing, the recent news includes at least the following aspects.

First of all, a person close to Xiaomi revealed that Lei Jun went to Xiaomi’s factory in Yizhuang shortly after the 8.14 speech, and held an all-hands meeting in person. The specific content was not disclosed. But superimposed on the day when the previous press conference ended, “model worker” Lei Jun flew from Beijing to the Shanghai Auto Show, etc., which is enough to show how much Lei Jun attaches importance to car manufacturing.

Secondly, Xiaomi Automobile Technology Co., Ltd. recently registered the domain name of the “xiaomiev” (EV, pure electric vehicle) website. The company was established in November 2021, with Lei Jun as its legal representative and a registered capital of RMB 1 billion. Xiaomi Technology Co., Ltd. wholly-owned shares.

In addition, Xiaomi increased its stake in Shanghai Tongyu Automobile Technology Co., Ltd., a supplier of automotive intelligent chassis systems. The registered capital of the latter increased from about 34.9939 million yuan to about 39.4634 million yuan, an increase of about 12.77%.

A netizen posted that on the Urumqi-Changji City Expressway, they ran into four camouflaged Xiaomi cars speeding along the road. On August 19th, Lei Jun also appeared in Xinjiang and posted a Weibo titled “Test #XiaoMimixfold3# Leica optics, four cameras and five focal lengths”. Some netizens noticed that the banner pulled up in the photo was suspected to read “Fight for Xiaomi Cars”. Regarding whether it is true, Xiaomi replied to the reporter that it would not comment.

Directly pointing to “the pinnacle of debut”

The only thing that is clear in the market at present is that Xiaomi’s goal is to officially mass-produce it in the first half of 2024.

According to sources close to Xiaomi, Xiaomi’s goal is to enter the field and be the first (camp), and it is necessary to compete with top teams.

The market believes that the starting point is autonomous driving. Xiaomi has formed a dedicated team since the announcement of the car, formulated a full-stack self-developed technology strategy, and worked with multiple teams within Xiaomi to focus on polishing autonomous driving technology. There are also media reports that Xiaomi’s automatic driving has automatic U-turn in unprotected scenes, automatic detour of vehicles in accidents, automatic left turn at multi-lane intersections, automatic detour around islands and other scenarios.

Some organizations predict that Xiaomi’s car business revenue will be estimated at 200,000 yuan in average selling price (ASP) and 150,000 units sold in 2024, and will achieve revenue of 30 billion yuan. In 2025, it will achieve a growth rate of 233.33%, with an average selling price of 200,000 yuan. , sales of 750,000 units. As the business is in its infancy, it is expected that the gross profit margin will be basically in line with its peers.

Although Xiaomi still did not give a clear response to the price issue; however, some netizens used Xiaomi mobile phones to ask Xiao Ai, a voice interaction software owned by Xiaomi, “how much is the price of Xiaomi cars”, and Xiao Ai answered “1. Standard version The price of Xiaomi car starts from 149,900 yuan, rear-drive single motor configuration, WLTC battery life up to 800 kilometers; 2. Pro version of Xiaomi car starts from 179,900 yuan, four-wheel drive dual motor configuration, WLTC battery life is about 700 kilometers.”

The impact of Xiaomi’s car manufacturing is not only Xiaomi’s performance itself. This can be viewed in two dimensions.

First, the launch of Xiaomi cars will help Xiaomi Group expand in the field of intelligence, and will also promote the intelligent upgrade of the entire automotive industry.

Second, there are many industrial chain companies in the capital market, which may also be greatly affected.

A company in the industry chain revealed to the Securities Times reporter that Xiaomi’s car battery suppliers have already finalized companies such as Ningde Times, but there is a high probability that there will be more than one company. The purpose is to ensure the stability of the supply chain.

In addition, industrial chain companies such as FAW Fuwei have also made it clear that they are actively communicating with Xiaomi Automobile, and many molecular companies have entered the procurement team of Xiaomi Automobile.

Although vowing to be the first camp, Xiaomi may face unprecedented fierce competition in the electric vehicle market. Tesla has developed 20 years ago; Weilai, Xiaopeng, and Ideal have just passed the 7-year itch stage. As a latecomer, Xiaomi needs to spend more energy to do market adaptation, consumer recognition, and brand accumulation if it wants to succeed in cross-border car manufacturing.

From the perspective of industry competition, Baidu’s new energy vehicles will be launched in the second half of this year, superimposed new car manufacturers and BYD, Tesla and other leading car companies, how Xiaomi can strike a balance between price and performance, and how to use technology Innovating and improving the experience will be an important challenge for Xiaomi.

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