BEIJING: Chinese leading smartphone-maker Xiaomi expects to break into the ever-expanding electric vehicle market by establishing a Beijing plant capable of producing as many as 300,000 vehicles a year from 2024.
Xiaomi signed an agreement with the committee of the Beijing Economic-Technological Development Zone to land the ambitious electric cars project in Yizhuang, a suburb southeast of the Chinese capital.
The new plant will be built in two phases with Xiaomi to create its auto unit’s headquarters, sales, and research offices as well, the local government announced in a WeChat post.
In March 2021, the smartphone company announced plans to invest up to $10 billion in a new e-vehicle enterprise over the near-decade. Xiaomi completed the business registration of its EV unit in late August. The firm pledged to start the manufacturing process for its first electric car by 2023 in order to release the EV in the market by early 2024.
Earlier this year, Xiaomi acquired an autonomous-driving-focused startup called Deepmotion and is reportedly expected to launch a subsidiary to further increase the pace of the project.
Meanwhile, some 500 employees out of nearly 14,000 working in the company’s research and development (R&D) wing are currently focused on the EV project, according to the recent financial report.
On the other hand, automakers are having to get creative to cope with the global shortage of semiconductors. The shortage, due to supply problems and a surge in demand for consumer electronics during the pandemic, has hit the auto industry hard, with millions of vehicles worldwide not being produced because important parts are missing.
With the problem lasting longer than initially expected, manufacturers including Daimler and Volkswagen have had to rethink production strategies. Car manufacturers usually buy parts from major suppliers such as Bosch and Continental, which in turn buy from suppliers further down the chain.