After nearly a decade of attempts, Apple abandoned its electric car project last year, despite having invested around $10 billion into it. At the same time, Xiaomi, known for its smartphones and affordable consumer electronics, managed to develop its first electric car in just three years and delivered 135,000 vehicles. The company plans to double that number during 2025.
The key to success – China’s manufacturing dominance
Xiaomi’s success where Apple failed highlights how much China has taken the lead in the electric vehicle supply chain. Chinese companies have perfected the production of electric vehicles, enabling Xiaomi to quickly and affordably source the necessary components.
In addition to Xiaomi, other Chinese companies such as Leapmotor, Li Auto, and Seres Group are finally turning a profit after years of intense competition in the world’s largest car market. Huawei has also entered the automotive industry, developing autonomous driving software and collaborating with leading Chinese manufacturers, including Seres Group, SAIC Motor, BAIC, and Chery.
Xiaomi SU7 – a car as part of a smart device ecosystem
Xiaomi has long been known for its Apple-inspired strategy, but it has found its own path. Its first electric car, the SU7, launched in March last year, features artificial intelligence to assist with parking, allows passengers to watch movies in the cabin, and offers remote control of smart devices in the home.
The SU7 is designed in the style of a Porsche, but it is far more affordable, costing around $30,000 — only a quarter of the price of premium models. The car uses data from Xiaomi’s smart devices to optimize battery charging times in line with the driver’s daily routine.
Xiaomi’s ecosystem of smart devices allows the company to integrate its cars with consumer electronics better than any competitor. Xiaomi has now fully infiltrated consumers’ homes, says Gary Ng, an economist at Natixis Corporate & Investment Banking.
Xiaomi is reshaping the global electric vehicle market
Although sales of the SU7 are still modest compared to leading Chinese brands, Xiaomi has already dealt a blow to foreign manufacturers. Porsche’s sales in China have fallen by nearly 30% since Xiaomi launched its first model.
