Lei Jun, the founder of Chinese consumer electronics maker Xiaomi, once again talked about the company’s vehicle business. On February 9, Lei said on the company’s most recent Investor Day that a quarter of his time was spent on mobile phones, IoT, and high-end involvement, half on cars and a quarter on other things.
Lei mentioned that Xiaomi Auto is striving to enter the top five in the world within the next 15-20 years, adding that Xiaomi‘s 100% ownership of Xiaomi Auto lies in the reuse of company-wide resources. In the past three years, Xiaomi has established 10,000 offline Chinese stores, which are very helpful to the marketing of Xiaomi Auto.
Regarding the time frame, Lei said, “The vehicle is a century-old field. As long as you are optimistic about the automobile industry, it is never too late. The development of Chinese electric vehicle makers is 6-7 years ahead of Xiaomi, but Xiaomi‘s advantage lies in electronic technology and user experience, and the delivery time in 2024 is just right.”
Last year, Xiaomi Auto and other new businesses attracted more than 3 billion yuan ($439 million) of investment, with more than 2,300 R&D personnel. In September last year, the first batch of soft-film vehicles went offline as scheduled, and winter tests started in December, showing that the progress of each team was better than expected.
On August 11, last year, The Paper reported that Xiaomi had invested 3.3 billion yuan in R&D in the field of autonomous driving in the first phase, and had set up an R&D team with a scale of over 500 people. Meanwhile, Xiaomi‘s automatic driving technology has entered its testing stage. In the first phase, 140 test vehicles have been planned, with the goal of entering the auto industry in 2024. This means that in the past six months, Xiaomi‘s R&D team has expanded by nearly 1,800 people.
When talking about the profit expectation of Xiaomi Auto, Lei said that, in the long run, aside from hardware profit, vehicle software profit is more important. “Xiaomi‘s advantage lies in its ability to integrate. Cars can integrate sales, after-sales service and charging piles. In the future, cars can integrate more and more services,” Lei added.
Lei predicted that the macro environment would improve this year, and the consumer electronics market has started to pick up, but risks and challenges still exist. In terms of business strategy, Xiaomi has put profits in an important position, optimized its management structure, improved its efficiency and business model, and will maintain huge cash reserves and invest cautiously.
“We are a company that serves users. We look forward to one day linking mobile phones, cars and smart home appliances.” Lei added, “We do not rule out mergers and acquisitions of some good companies, but we will consider stable operations.”
When talking about ChatGPT, Adam Zeng, president of Xiaomi‘s mobile phone department, introduced that ChatGPT is based on a large AI model, with 100 billion-level parameters, data volume, manual labeling and other technologies. Xiaomi has always invested in large AI models and has extensive applications in the ChatGPT field, such as Xiaoai Tongxue, an intelligent voice assistant, and robots.