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Xiaomi has become known in China for its smart home ecosystem, which the company now hopes to extend to electric cars. Photo: SCMP/Simon Song

Xiaomi talks electric vehicles with state-owned carmaker FAW Group as it pursues smart car ambitions

  • Xiaomi held an ‘in-depth’ talk with FAW Group last week in Jilin, where the electronics brand wants to bulk up electric car cooperation
  • The world’s second-largest smartphone maker jumped into the EV market this year, investing in multiple autonomous driving companies
Chinese smartphone brand Xiaomi recently held an “in-depth” talk with state-owned carmaker FAW Group as the Beijing-based gadget maker vies for a piece of the country’s rapidly growing electric vehicle (EV) market.

Lei Jun, Xiaomi’s billionaire founder and CEO, paid a visit with his team last week to FAW in Jilin province, according to a report from the state-owned Jilin Daily on Saturday. Xiaomi confirmed the report on Monday, but did not offer additional details.

FAW, or First Auto Works, is best known for its Red Flag sedans driven by state leaders. The company was considered one of the “old sons” of the People’s Republic of China, with a long history of making sedans for the country’s founding leader Mao Zedong.

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Xiaomi is a newcomer to the automotive industry, having just announced in March that it was working on its own electric car. Lei said in Jilin that his company must seize the opportunity of deep integration between cars and consumer electronics. Xiaomi will strengthen cooperation with car companies in Jilin to make “high-quality” vehicles, Lei added, without offering details.

Bordering North Korea and Russia, Jilin is one of the northeastern provinces that make up China’s rust belt. It has long promoted the development of key industries boosted by the government, which includes cars and other manufacturing.

FAW is already receiving local government support, according to provincial party secretary Jing Junhai. The government wants FAW to become a world-class enterprise and hopes Xiaomi will be integrated into Jilin’s automotive supply chain, Jing said.

Even before officially announcing its foray into EVs, Xiaomi’s move had been anticipated. It comes amid an explosion of demand for electric cars globally, especially in China, where the industry has been supported with generous subsidies.

China’s EV market will eventually reach 1 trillion yuan (US$155 billion) per year, according to an estimate from the Ministry of Industry and Information Technology, which did not offer a timetable for that forecast.


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Many of the world’s largest tech companies are already involved in autonomous driving projects using electric cars, most notably internet search giants Google and Baidu. Apple has also been rumoured to be working on an electric car.

Xiaomi is the world’s second-largest smartphone vendor by shipments, after Samsung Electronics, and it operates its own Apple-like ecosystem of smart home products in China. The company has pledged an initial EV investment of US$1.5 billion and plans to spend US$10 billion over the next decade.

The company has also invested heavily in EV companies recently. It bought the autonomous driving technology firm DeepMotion for US$77.4 million, company president Wang Xiang said last month during a second-quarter earnings call. It made the acquisition to fast track its smart EV business, Wang said.

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In June, Xiaomi Ventures led a US$374 million series D funding round for Hesai, which makes lidar sensors to facilitate autonomous driving. That same month, the smartphone company invested in ZongmuTech, another maker of autonomous driving technology.

Xiaomi has been on a hiring spree, as well, as it searches for tech talent to bulk up its EV unit.

Last month, media reports said that embattled Chinese property giant Evergrande was in talks to sell part of a 65 per cent stake in its listed EV unit to Xiaomi and Shenzhen government-backed investment firms. Evergrande clarified later that it had held initial talks with Xiaomi, but there were no further developments.

This article appeared in the South China Morning Post print edition as: Xiaomi in talks with state carmaker FAW as it looks to move into green transport