Chinese manufacturing giant, Xiaomi has been working on its quest to enter the automobile market. There are some new developments in Xiaomi’s car manufacturing plans. After the registration of Xiaomi Automobile Co., Ltd. in September, the company has recently registered a second car company. According to the enterprise check app, on November 18, a second Xiaomi Automobile Technology Co., Ltd. was established with Lei Jun as the legal representative. Furthermore, this company has a registered capital of 1 billion yuan ($156.7 million). The business scope of this company includes the manufacturing of new energy vehicles, technology development, etc.
Xiaomi officially announced the production of cars at the end of March this year. The company plans to establish a wholly-owned subsidiary to be responsible for the smart electric vehicle business. The initial investment is 10 billion yuan ($1.57 billion). However, the company will invest approximately 60 billion yuan ($9.4 billion) in the next 10 years. Lei Jun will concurrently serve as the CEO of the smart electric vehicle business.
At the Xiaomi spring new product launch conference, Lei Jun claims that Xiaomi will use its existing arsenal to build cars. The company has an existing cash reserve of 108 billion yuan ($17 billion) as well as an R&D team of more than 10,000 people. Furthermore, it has the world’s top three mobile phone businesses. The company hopes to use these “advantages” to build the world’s best smart car ecosystem.
In October of this year, Xiaomi announced that it had built an automobile team of 453 people. The industry also expects Xiaomi to officially mass-produce its first car in the first half of 2024.
Xiaomi Negotiates With Evergrande Group
According to reports, Evergrande Group is negotiating with Xiaomi to sell 65% of its electric vehicle division. The source claims that the negotiations are still at an early stage. At the moment, there is nothing concrete in the negotiations.
However, it is worth noting that China Evergrande, Evergrande Auto, and Evergrande Property jointly announced that the company is contacting several potential independent third-party investors to discuss the sale of some of the company’s assets, including but not limited to the sale of the company’s listing Part of the equity of subsidiary China Evergrande New Energy Automobile Group Co., Ltd. and Evergrande Property Group Co., Ltd.
Subsequently, Evergrande Auto responded that they want to sell part of Evergrande’s assets, not the entire group. Recently, Evergrande Automobile issued a profit warning announcement. As of June 30, the company had a net loss of about 4.8 billion yuan ($0.74 billion). For the same period in 2020, the company’s net loss hit 2.45 billion yuan (0.38 billion).