Xiaomi Corporation is reportedly facing delays in acquiring a license to make EVs of its own in China under the Xiaomi Automobile brand it registered in 2021. As a result, the behemoth consumer electronics manufacturer is in early talks with Beijing Automotive Group Co. (BAIC) to co-develop EVs in order for the latter to fulfill its promise of delivering its first vehicles by 2024.
Xiaomi Corp. has been known as a Chinese electronics company based on an Internet of Things (IoT) platform – the company currently manufactures smartphones, mobile apps, laptops, and home appliances.
In recent years, Xiaomi’s leaderboard status in smartphone sales in China has dwindled in China, causing the company to pivot out in search of new outlets to maintain its cash flow.
In March of 2021, we reported that Xiaomi had shared definitive plans to manufacture its own brand of EVs aimed at the mass market. By September, Xiaomi had officially registered an EV company in China but was still searching for an experienced partner in EV manufacturing to help it transition into building cars.
Xiaomi co-founder Lei Jun vowed to invest roughly $10 billion over the decade to make Xiaomi branded EVs by 2024. Now, nearly a year later, Xiaomi still has little progress to show and is reportedly considering co-branded EVs to make good on the co-founder’s bold promise.
BAIC is merely the latest EV automaker in talks with Xiaomi
According to a recent report from Bloomberg, people familiar with the matter state Xiaomi Automobile is in talks with BAIC Group’s EV automotive brand, BAIC BluePark New Energy Technology Co.
Sources who asked not to be named said the two manufacturing experts are exploring multiple ways to collaborate. One strategy includes Xiaomi purchasing a stake in Beijing Hyundai No. 2 plant, which is fully licensed to make cars in China – a certification requirement Xiaomi Automobile is having trouble with on its own.
If it came to fruition, the pending collaboration could see EVs built by BAIC BluePark and co-branded with Xiaomi Automobile, although the Hyundai No. 2 plant where the flagship vehicles would be assembled would require some serious upgrades to support EV production. That being said, the plant already has the production capacity to support Xiaomi-BAIC EVs.
In November of 2021, Xiaomi announced a signed contract with a committee from the Beijing Economic-Technological Development Area to establish its entire automotive business in the suburb of Yizhuang. The infant automotive brand said it would establish its headquarters, R&D, and manufacturing on the Beijing site that would be constructed in two phases, each delivering production outputs of 150,000 EVs per year for a total of 300k.
Xiaomi has also shared how deep its search for an automotive partner has already gone, admitting to 85 different industry visits, in addition to extensive meetings with more than 200 automotive veterans from companies like BYD, Great Wall Motor, Wuling Motors, and SAIC.
Last year’s news of its own EV business park made it seem like Xiaomi had decided to go it alone, but a year later, it appears to have circled back toward a partnership and has honed in on BAIC. That being said, talks remain in the preliminary phase and could just as quickly dissolve into vapor.
If Xiaomi Automobile truly believes it can still deliver its first EV within less than two years, it better get moving. At this point, a manufacturing partner with automotive experience feels vital.
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