Our favorite Chinese manufacturer, Xiaomi, is preparing its first electric car in its history. However, the political situation in China is definitely not easy, and it’s throwing roadblocks in the way of the company so it can start its production.
Electric car plans face complications in China
By the end of last year, we already spotted the first leaks about an electric vehicle from the Xiaomi brand. With this product, the Chinese company would join a kind of imagined race—where each tech manufacturer tries to launch its model first. After all, the American brand Apple is also working on a concept of its own vehicle.
Today, we already know that these rumors turned out to be true, and within a little less than a month Xiaomi should be ready to unveil its first prototype. However, it seems the Chinese government isn’t very happy with the timing of this concept reveal, and it has caused complications for the project.
The Xiaomi electric car project involves an investment of roughly $10 billion. And CEO Lei Jun also said that this will be the last industry the company enters—hoping it will build a large community that will join the brand’s current fan base.
A missing license is being blocked by the National Development and Reform Commission
To achieve real electric car production in China, you have to go through all the regulatory bodies—just like Xiaomi. As Bloomberg reports, Xiaomi has been negotiating for months with China’s National Development and Reform Commission, which has the final say in the approval process, and so far these talks haven’t brought many wins.
The company was asked to submit additional documents to prove not only financial capacity, but also technological “know-how.” The extra paperwork requires oversight, which will most likely take months—and it may trigger further requests for additional information. If Xiaomi’s request to manufacture vehicles is denied, the company will have to start the whole process over.
The start of sales is scheduled for the year 2024
Unfortunately for Xiaomi, the world of electric vehicles doesn’t wait. Chinese—and foreign—competitors are moving at a dizzying pace, and the longer the company has to wait, the bigger and stronger the competition will become.
The research and development phase is completed, and a missing license will not stop the design process or production preparations. The company already employs more than 1000 people and has obtained a plot of land where it plans to build its factory, hoping to start selling its electric car from 2024. However, the missing license means that production is not yet allowed.
Xiaomi also saw, for the first time in its history, a decline in terms of the company’s financial results. Hong Kong stock exchanges reacted to the news immediately—Xiaomi’s shares dropped by 5,8%. Still, whether Xiaomi will ultimately manage to resolve its disputes with the Chinese government, and officially become an automaker, will only become clear with time.
How do you like the upcoming electric car from the Chinese brand Xiaomi? If you have any other questions, feel free to write them below, in the discussion under the article. Also follow our group on Facebook: Xiaomi Planet – A place for true Xiaomi fans and also our Xiaomi Planet portal, where you can learn more information.
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