Beijing-based tech giant Xiaomi has achieved a significant milestone in its journey towards entering the electric vehicle (EV) market. Reliable sources have revealed that China’s National Development and Reform Commission (NDRC), the regulatory body overseeing the country’s auto industry, has granted Xiaomi the green light to commence EV manufacturing. This development marks a crucial advancement for Xiaomi as it strives to realize its ambitious goal of producing cars by the early months of the upcoming year.
The NDRC’s approval is a momentous step for Xiaomi, positioning the company as only the fourth enterprise to secure such permission since late 2017. This decision signifies Xiaomi’s proximity to the large-scale production of EVs, a journey that began over two years ago with the initial announcement of their automotive venture. However, it’s important to note that Xiaomi’s EV aspirations still require validation from the Ministry of Industry and Information (MIIT), responsible for evaluating the technical and safety aspects of new automakers and their vehicle models.
Xiaomi’s entrance into China’s bustling car manufacturing sector comes at a juncture when the global automobile market, especially the largest one in China, faces several challenges. These include an excess production capacity and a slowdown in consumer demand, factors that have contributed to intense pricing competition and supplier profitability constraints.
In pursuit of its automotive ambitions, Xiaomi has committed a substantial $10 billion investment over a ten-year span. The company has set an ambitious target to commence mass production of its debut vehicles within the first half of 2024. Nevertheless, the cautious approach of the NDRC in authorizing new EV production plans has raised questions about whether Xiaomi’s proposed timeline can be adhered to, given concerns about market overcapacity and decreasing demand.
It is noteworthy that even Tesla, a prominent player in the EV space, encountered delays in gaining approval to expand its Shanghai facility. Furthermore, industry insiders have indicated that U.S.-based luxury EV manufacturer Lucid Group has expressed interest in manufacturing cars in China but has been advised of the potential challenges in obtaining approval.
As of now, the precise reasons for the NDRC’s approval of Xiaomi’s EV manufacturing are not immediately available. It’s worth mentioning that Xiaomi’s EV plant designated by the Beijing municipal government as a pivotal project for industrial enhancement.
Despite awaiting official endorsements, Xiaomi has made remarkable progress in its EV venture, having completed the construction of manufacturing facilities capable of producing up to 200,000 EVs annually. This update reported by the state-run newspaper Beijing Daily in July.
Xiaomi, renowned for being the world’s third-largest smartphone brand in terms of shipments, refrained from offering an immediate comment regarding this development. Similarly, both the NDRC and MIIT did not provide prompt responses to faxed inquiries for comments. Given the confidential nature of the matter, the sources chose to remain anonymous.
Xiaomi’s successful advancement through the NDRC’s approval represents a substantial leap forward in its electric vehicle aspirations. The company’s progress in building manufacturing capabilities further cements its determination to make a mark in the rapidly evolving EV landscape.
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