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| Image Credit: Xiaomi |
Xiaomi, known for smartphones and home appliances, entered China's crowded EV market this year as part of a strategy to diversify its product portfolio. Speaking at an annual event held in Beijing, Lei explained that the decision started out as an "accident." The ban, announced in the final days of the Trump administration, had put Xiaomi on the US sanctions list, causing a major disruption to the company's expansion plans.
"I got a call from a friend saying we were banned. It was like a lightning strike," Lei said. The same day Xiaomi called an emergency board meeting and accelerated its struggle to develop an electric car.
Xiaomi's EV launch: SU7 debuts
At Friday's event, Lei elaborated on Xiaomi's EV launch effort. He revealed that the company would not have entered the automotive industry so quickly had the US sanctions not had a major impact. Xiaomi's EV, the SU7, is aimed at wooing buyers from Tesla and established luxury brands such as BMW, Audi and Mercedes. It is a sporty, Porsche-like EV with a price tag of less than $30,000.
Production and sales targets
Xiaomi plans to deliver at least 100,000 SU7 EVs this year, with a target of selling 120,000 units. This represents a significant increase from the target of 76,000 vehicles set earlier this year. Lei pointed out that the company has delivered more than 25,000 EVs by the end of June and expects to reach the target of 100,000 units by November.
Driving force to diversify
"I have to thank the accident three years ago," Lei said, for pushing the company to diversify. The company had turned down an offer from venture capital to fund its early-stage EV operations that valued it at $10 billion. The SU7 is currently only available in China, but Lei's goal is to make Xiaomi one of the top five global automakers.
Trump's views on the EV industry
Donald Trump dedicated part of his speech accepting the Republican Party's nomination for president on Thursday to the EV industry. He said he would roll back stricter vehicle emissions regulations that have driven the shift toward electric cars. He also announced that if elected in November, he would impose import duties of up to 200% on Chinese EVs manufactured in Mexico, though he would support Chinese investment in plants in the United States.
Conclusion
Xiaomi's entry into the EV market is not only part of the company's strategy to diversify, but also an unexpected result of the Trump administration's restrictions. With the launch of the SU7, Xiaomi is moving beyond its smartphone and home appliances market and making its mark in the automotive industry.
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