Chinese tech giant Xiaomi, which is the world’s third-largest smartphone manufacturer, has announced that the company will set up a new wholly-owned subsidiary for its smart electric vehicle business.
The company has also confirmed that it will be investing around $10 billion over a period of 10 years for this new business. Lei Jun, who is the CEO of Xiaomi Group will also serve as the CEO for this new electric vehicles business.
Making the announcement, Xiaomi said that it will kick off the business with an initial investment of around $1.5 billion. Lei Jun said that “the decision was made after numerous rounds of deliberation among all our partners, and this will be the final major entrepreneurial project of my life.”
Currently, no more information is available about this smart car project from the company. It remains to be seen what types of cars the company is planning to make and the market it plans to target. But going by the company’s history, it’s likely to be a budget car targeted at the masses.
Electric cars are gaining traction in China because of strong policy support from Beijing, including subsidies. Even though some of these measures have been reduced, it is being forecasted that around 1.9 million electric vehicles will be sold in China in 2021, representing year-on-year growth of 51 percent.