As 6park says today, Xiaomi Group decided to produce a car and sees it as a strategic decision. But on the other hand, the path Xiaomi will follow for car production has not yet been determined, and there still seems to be some improvement.
Affected by this news, Xiaomi Group’s Hong Kong shares rose 11.81% and then fell slightly. As of closing, Xiaomi Hong Kong shares increased 6.424% to $ 30.65 HK (Hong Kong Dollars).
But interestingly, Xiaomi did not give a definitive answer. He just used the phrase Wait and See.
After the news that Xiaomi confirmed that it would make a car, the media immediately contacted many people close to Xiaomi and Lei Jun. These people said that they have not heard the news that Xiaomi will build a car. A person close to Xiaomi directly stated that the company does not need to build a car. He mentioned the following key points:
- Xiaomi still has many opportunities in the smartphone market. After Huawei’s chip supply was cut, smartphone production fell short and a lot of space was freed up in the domestic market. At the same time, Huawei in Europe is in a significant contraction trend. Sales of Xiaomi smartphones reached enormous numbers in China and abroad. Xiaomi should prioritize the core market.
- Unlike Baidu, Xiaomi does not have much infrastructure in the areas of autonomous driving and artificial intelligence of vehicles, and the most critical thing is that it knows almost nothing about the automotive industry.
- If you start producing cars now, it will be on the market in 2025 at the earliest. By then, the electric car army of traditional car companies such as Volkswagen and Toyota will already be in place. It is very difficult for new brands to compete with traditional car companies.
Let’s see what path Xiaomi will follow, we will see together.