China’s EV war: Xiaomi enters the fray with multibillion-dollar investment in world’s largest electric vehicle market

Xiaomi will kick off its electric vehicle project with an initial investment of US$1.5 billion and expects to spend up to US$10 billion over the next decade

Lei Jun, Xiaomi’s founder and chief executive, will head the company’s new electric car division

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Xiaomi Corp founder and chief executive Lei Jun speaks at the company’s Mega Launch event in Beijing. Photo: VCG via Getty Images

Published: 5:40pm, 30 Mar 2021Updated: 6:10pm, 31 Mar 2021

Xiaomi Corp, one of the world’s largest smartphone vendors, is joining the fray in the country’s booming electric vehicle (EV) industry, as it announced a long-anticipated plan to produce all-electric cars in the industry’s largest market.

Lei Jun, the billionaire founder and chief executive of Xiaomi, said at the company’s Mega Launch event on Tuesday that this push into the electric car market represents “the last entrepreneurship of my life”, without elaborating.

The Beijing-based company behind the Mi Android smartphone brand will kick off its electric car project with an initial investment of 10 billion yuan (US$1.5 billion), and expects to spend up to US$10 billion in this enterprise over the next 10 years, Xiaomi said in a statement after trading hours in Hong Kong. Lei will head the new business as its chief executive, according to the company

“What do we have? We have money,” Lei said at the event. “More importantly, we have 10,000 people in R&D and we will add another 5,000.”

The 51-year-old Lei said he knows “the risks that this endeavour entails” and that the company’s investment “won’t see a result in the next few years”. He indicated that Xiaomi “is a different company from the small start-up 10 years ago that had only three to five people”, adding that the firm has “accumulated a lot of wisdom and experience” to be able to test the waters of the electric car industry.

Xiaomi Corp unveiled its first foldable smartphone, the Mi Mix Fold at a launch event in Beijing on March 30, 2021. Photo: Handout

The Hong Kong-listed firm is the latest tech company to join the smart mobility race in the world’s largest car market.

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