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Xiaomi is reportedly planning to develop an electric vehicle. The Chinese smartphone company is said to be collaborating with Great Wall Motor Co Ltd for both its manufacturing plant and its engineering expertise.
Xiaomi is looking to diversify after dominating the smart devices ecosystem. News of Chinese smartphone manufacturer, Xiaomi’s plans to build the first electric car were revealed by Reuters. The news agency reports that they were tipped by three informants who are close to the matter. The Xiaomi company has over the years impressed with its pocket-friendly prices, a key aspect that it will look to deploy with its EVs. Similar to its electronics products, the company will look to sell the EVs to the mass market. According to one of the sources, the electronics manufacturer aims to roll out the first EV by end of 2023 by working with Great Wall Motor.
It further aims to keep up with an intense race among top technology companies to develop eclectic cars. Some of the companies that have confirmed their intentions to develop an electric vehicle include Google, Apple, Baidu and Intel. A majority of these, aim to achieve their goal through collaborations with established motor vehicle manufacturers. For Xiaomi, the information about EVs is not yet official and neither Xiaomi nor Great Wall has made any comments.
Xiaomi Shares Rally Boosted by EVs Plans
Great Wall has been a big player in China and currently manufactures the most bought pick-up truck in the country. This is the first time the motor giant is collaborating to manufacture motor vehicles. One of the informants noted that it will be tasked in both manufacturings in one of its plants. Additionally, it will offer engineering consultation to speed up the project.
Investors have been positive about the collaboration with both companies rallying on Friday. Since the news broke, Xiaomi stock prices jumped 9%. Great Wall has seen Hong Kong shares add 15% while its Shanghai shares added 10%. Investors are convinced that the partnership is a win for both companies.
Tech Companies’ EVs Race
With fossil fuels proving both harmful and provisional, the future of motor vehicles is in electricity. Already companies like Tesla Inc (NASDAQ: TSLA) and Lucid are ahead in the game but have failed to serve the masses. In there lies the opportunity that the aforementioned tech companies have been competing to solve. Because they lack manufacturing expertise and are looking to ensure low manufacturing costs, the tech companies have been partnering with traditional motor companies. The tech companies can then center on branding and utilizing technological advancements such as internet connectivity, smart/self-driving and other advanced tech assists.
Despite Xiaomi being less than a decade into the electronics game, it has become a market leader. This proves that in the EVs race, Xiaomi will be a major player. As an already established player and working with an established car manufacturer, the two could easily win the race rolling out the first mass EVs.