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In his recent tweets, Lei Jun shared Xiaomi’s vision about its future EV product and the whole industry. He said his company had conducted thorough research and gained deep insights into the industry before entering the market.

First, Lei showed the feasibility for a manufacturer to tap into EV. He noted 30,000 EV components are highly modular and the cost of batteries has fallen by 80% in the past ten years, moreover, there is at least 50% more room for cost reduction in the future. Citing these data, he believes the manufacturing threshold of EVs has been dramatically lowered compared with gasoline-powered vehicles.

Then Lei said he deems the EV as “a form of consumer electronics with intelligentization, software, and user experience at the core”. He thinks the focus of the overall auto industry will evolve from mechanics to consumer electronics, where market share is highly concentrated among the top players.

Underlining how brutal the competition in EV would be, Lei expected the world’s top five brands will hold more than 80% of the market share if the sector is developed into a mature one. “In other words, the only way for us to succeed is to be one of the top 5 and ship more than 10 million cars annually,” the executive said.

Xiaomi announced in March, 2021 to set up a wholly owned subsidiary to produce EVs, with the initial investment of RMB10 billion and the total input in the coming decade expected amount to US$10 billion. Xiaomi Auto decided in November to settle in Yizhuang, a town in the southeast suburbs of Beijing, with the aim for an annual production capacity of 300,000 vehicles. It plans to conduct two-phase construction starting from April, 2022, and each phase has a capacity of 150,000 units per year. The unit also aims to start mass production in 2024.

In August, Lei Jun disclosed Xiaomi has established an R&D team of more than 500 talents, and plans to create a fleet of 140 test vehicles in the first phase of the technology development, targeting to become a leader in the smart EV industry in 2024.

快報