Xiaomi on Wednesday, 1 September, announced that it has officially completed the business registration of its electric vehicle business, as reported by CNBC.
The new subsidiary is called Xiaomi EV, Inc. and will be led by the group’s founder and CEO Lei Jun. It opened with a registered capital of 10 billion yuan, which is equivalent to about US$1.55 billion.
Over 300 employees have already joined the newly launched division, a statement from the Chinese electronics giant said. Xiaomi also announced that the team has entered a “substantial development phase”, having conducted over 2,000 interview surveys and visited over 10 industry peers and partners for research in the last five months.
The popular smartphone maker first announced that it was venturing into the automotive sector in March 2021, pledging to invest US$10 billion into the division in the next decade. "Xiaomi hopes to offer quality smart electric vehicles to let everyone in the world enjoy smart living anytime, anywhere," the company previously said.
The announcement comes less than a week after Xiaomi acquired autonomous driving firm Deepmotion for around US$77 million. Xiaomi said that the acquisition is meant to "enhance the technological competitiveness" of the electric vehicles it eventually plans to launch. This seemingly hints that Xiaomi's electric vehicles will tout some self-driving capabilities.
Xiaomi also reported that it saw record revenue and profit growth in Q2 2021. The total revenue amounted to 87.8 billion yuan, representing an increase of 64% year-over-year with an adjusted net profit for the period of 6.3 billion yuan and an increase of 87.4% year-over-year.
Smartphone sales account for a large portion of the company's total revenue. The new push towards the automotive sector, however, signals that the company is looking to reduce its reliance on smartphones in the future.
Xiaomi EV, Inc. is said to be entering a highly competitive space in China, putting it in direct competition with the likes of Baidu, Xpeng, Nio, and Tesla.
Written by Kyle Chua