Xiaomi Corp. is joining the electric vehicle (EV) bandwagon.
Chinese company Xiaomi Corp. is joining the electric vehicle (EV) bandwagon.
In a statement, the company said it will set up a wholly owned subsidiary to operate the smart EV business. Initial investment will be CNY10 billion, with the total investment amount over the course of the next 10 years estimated to be $10 billion.
Xiaomi manufactures mobile phones, TVs, and other smart devices such as wearables, speakers and earphones, and electric scooters.
Lei Jun, CEO of Xiaomi, will concurrently serve as the CEO of the EV business.
China’s government has been supportive of the transition to EVs, but several changes to EV-related policies and consumer subsidies in recent years disrupted the market and car makers struggled to build sales momentum, according to market research firm Canalys.
Chris Jones, Chief Analyst for automotive at Canalys, said the Chinese EV market in 2020 was all about two vehicles: the made-in-China Tesla Model 3, the market leader in the first half of 2020, and the Hongguang Mini EV from the SGMW joint venture (SAIC, General Motors and Wuling), the market leader in the second half of 2020, which only launched mid-year.
“If it had not been for the huge success of these two very different EVs, the Chinese EV market would have declined in 2020. Between them, the two models represented one in five of all EVs sold in China,” said Jones.
In its new research, Canalys said a record 1.3 million electric vehicles (EVs) were sold in China in 2020, up by 8% year-on-year. In comparison, worldwide sales of EVs rocketed by 39% last year. Nevertheless, China accounted for 41% of the global EV sales, just behind Europe’s 42%. Canalys’ research noted that China is still far ahead of the United States in terms of EV share—in the US, EV sales represented just 2.4% of sales in 2020.
“Prospects are very good for China’s EV market in 2021,” said Jones. “There is already an excellent network of standardized public EV chargers in China, good government support and now a return to strong consumer demand.”
Canalys forecasts 1.9 million EVs will be sold in China in 2021, up by 51% and a 9% share of all cars sold in China.