Xiaomi founder Lei Jun shared his thoughts on the global electric vehicle industry on October 19, writing on Twitter that the top five brands will hold more than an 80% combined market share when the industry reaches maturity. Thus, the entrepreneur wrote, the only way for Xiaomi to succeed is to be among the top five leading brands, shipping more than 10 million cars annually.
Lei argued that the manufacturing threshold for EVs has been dramatically lowered compared to fuel-based cars. 30,000 components are highly modular, and the cost of batteries has fallen by 80% in the past 10 years with at least 50% more room for future cost reductions. Therefore, Lei contends that EVs are a form of consumer electronics, with intelligentization, software, and user experience at the core.
The essence of the auto industry will evolve from mechanics to consumer electronics, where market share is highly concentrated among the top players, he added.
Tesla entered the EV industry more than 10 years ahead of Xiaomi, so some analysts think that Xiaomi has already missed its window to enter the market. Lei refuted this argument last month, adding that the race is just getting started, and that Xiaomi has plenty of opportunities.
Mass production of Xiaomi Auto vehicles is expected to begin in the first half of 2024. The Beijing-based firm has formed a team of more than 500 people, focusing on sensors, chips, simulation technology, high-precision mapping, perception gauge control algorithms, tool chains, high-accuracy positioning, training ability and more. Its auto business has obtained support from other departments within Xiaomi, such as artificial intelligence, voice assistance and smartphone cameras.
By the end of 2022, the auto team is expected to exceed 600 people. Through mergers and acquisitions and investment in upstream and downstream enterprises, Xiaomi will further promote medium and long-term industrial layout in the field of autonomous driving.
In addition, Xiaomi has invested in lidar manufacturer Hesai Technology, autonomous driving system solution providers Zongmu Technology and Geometrical Perception and Learning, and intelligent parking platform Aipark, to make up for its shortcomings in various fields.
In the current Chinese car market, traditional car enterprises have fully turned to the field of pure electric vehicles. In addition to firms like NIO, Li Auto, XPeng, NETA and Leapmotor, the entrance of tech giants such as Huawei, Xiaomi and Baidu has left China’s smart EV market in a state of flux.