Source: Securities Times
On the afternoon of November 15, the “Xiaomi car” entry hit Weibo trending.
On the same day, in the “Notice on Road Motor Vehicle Manufacturers and Products” (377th batch) issued by the Ministry of Industry and Information Technology, two Xiaomi brand pure electric sedans were listed.
According to reports, Xiaomi's first car was a pure electric sedan. The models were SU7 and SU7 Max, and the length of the car was 4.997 meters. The biggest difference between the two models was the amount of power. The former had a peak motor power of 220 KW, while the latter was 275 KW, or a high-performance version. The batteries are lithium iron phosphate batteries (Xiangyang Fudi batteries) and ternary lithium-ion batteries (Ningde era), respectively. Among them, Xiangyang Fudi batteries belong to BYD.
According to the announcement, the Xiaomi brand electric sedan product models are BJ7000MBEVR2 and BJ7000MBEVA1, the name of the declared company is BAIC Motor Group Off-Road Vehicle Co., Ltd., and the declared production address is “No. 21 Huanjing Road, Beijing Economic and Technological Development Zone, Beijing”.
The reporter learned from Tianyancha that on November 3, the first branch of Xiaomi Jingming Technology Co., Ltd. in Beijing was established. The head office is Lei Wei. The business scope includes software development, data processing services, communication equipment sales, electronic product sales, etc. The head office is Xiaomi Jingming Technology Co., Ltd. The registered address of this branch is Building 9, No. 21 Huanjing Road, Beijing Economic and Technological Development Zone.
According to current regulations, domestic NEV manufacturers must obtain two qualifications in order to produce and sell: the first is the NDRC's filing of production projects for automobile investment enterprises. New energy vehicle companies need to prove their strengths in various areas such as financing ability, R&D ability, production capacity, and quality assurance, etc., to be recognized by the NDRC. After obtaining this qualification, enterprises are required to build a factory within 2 years and sell vehicles within 3 years; second, it is an entry qualification for automobile manufacturers managed by the Ministry of Industry and Information Technology. Car companies need to meet the “Regulations on the Administration of New Energy Vehicle Manufacturers and Product Entry”.
In August of this year, there was news that Xiaomi had obtained approval from the National Development and Reform Commission to produce electric vehicles. Now it has also received a “car building ticket” from the Ministry of Industry and Information Technology, which means that Xiaomi has already obtained a license to manufacture automobiles.
Officially listed in the first half of 2024
Since Lei Jun announced Xiaomi's entry into the smart car industry, developments in Xiaomi cars have received a lot of attention.
In August of this year, a netizen said that on the Urumqi-Changji city expressway, they met four disguised Xiaomi cars speeding along the road. On August 19, Lei Jun, founder, chairman and CEO of Xiaomi Group, also appeared in Xinjiang and posted a “Test #小米mixfold3 #徕卡光学、四摄五焦段” Weibo. Some careful netizens noticed that the banner raised in the photo was suspected to be “fight for Xiaomi cars.”
In October 2023, Lei Jun announced that Xiaomi is progressing smoothly and will be officially launched in the first half of 2024. According to the Xiaomi announcement, Xiaomi has officially entered the field of smart electric vehicles and will invest 10 billion US dollars over the next 10 years. Lei Jun believes that smart electric vehicles will be the broadest development track in the next 10 years.
At the Xiaomi new product launch conference held in October this year, Xiaomi unveiled the Surge OS operating system. The system is not only suitable for mobile devices such as mobile phones, but will also be installed on Xiaomi cars. According to Lei Jun, Xiaomi Surge OS is based on the integration of deeply evolved Android and the self-developed Vela system, completely rewriting the underlying architecture to create a public foundation for the Internet of Everything for the future 10 billion devices and 10 billion connections.
On October 16, Tianfeng International Securities analyst Guo Mingyi recently released a research report saying that Xiaomi's first car is expected to go on sale in 2024, with an estimated shipment volume of 50,000-60,000 units.
Guo Mingyi said in the report that sales of the M7 in the new Huawei industry have exceeded expectations, indicating that due to the high division of industrial labor in the Chinese electric vehicle market in terms of manufacturing, the focus of competition has begun to shift to autonomous driving, software, marketing and channels. He believes that this new competitive pattern is beneficial for Xiaomi to enter the automotive market.
He also said that the price of Xiaomi's first car will be less than 300,000 yuan. Key selling points include autonomous driving, software ecology, 800V fast charging, and power configuration.
Xiaomi cars may produce their own
Judging from information released by the Ministry of Industry and Information Technology, although Xiaomi shows the name of the declared company as BAIC Group, the production address is shown as the location of Xiaomi's self-built factory.
The reporter learned from Baidu's driving car encyclopedia that the Xiaomi car factory was built in Yizhuang, Beijing, and is located at the Majuqiao Intelligent Manufacturing Base (Intelligent Manufacturing Base) in Beijing's Yizhuang New Town (Tongzhou area). The total investment of the project is estimated at 63 billion yuan.
According to information, the Xiaomi automobile plant will be built in two phases. The first and second phases will both have an annual production capacity of 150,000 vehicles, and the total production capacity can reach 300,000 units/year after the factory is officially launched.
During the construction of the Xiaomi automobile factory, the company widely recruited personnel related to vehicle production and vehicle technology. According to recruitment information on Xiaomi's official website, the company has a talent demand for automobile workshop production managers, workshop safety engineers, and lean engineers in the Beijing region, and there is also a high demand for employment in positions related to automobile production, such as stamping, die-casting, die-casting molds, die-casting machining, body, paint, and sheet metal.
In addition, Xiaomi is also building its own car sales channels to prepare for nationwide sales. From September to October 2023, Xiaomi Jingming Technology Co., Ltd. (a wholly-owned subsidiary of Xiaomi Intelligent Technology Co., Ltd.) has successively established subsidiaries in Wuhan, Shenzhen, Xi'an, Hangzhou, Guangzhou, Shanghai and Suzhou. The newly established company's business scope covers NEV vehicle sales and other businesses.
In fact, in order to successfully enter the car-building industry, Xiaomi began making continuous high-intensity investments in the automotive sector many years ago. The Changjiang Xiaomi Industrial Fund and Shunwei Capital are important investors in Xiaomi.
Shunwei Capital of Lei Jun Holdings participated in NIO's Series A financing in 2015, NIO's Series B financing in 2016, and Xiaopeng Motor's Series A+ financing in 2017. In the same year, Shunwei Capital led Series A financing for the intelligent driving startup Momenta, and provided continued support in Series B, Series C, and C+ financing.
In August 2021, Xiaomi wholly acquired the autonomous driving company DeepMotion Tech Limited (Shendong Technology) and continued to increase R&D capabilities in smart driving sensing, positioning, planning, and control. Shendong Technology has a wide range of layouts in the fields of high-precision positioning, high-precision maps, and 3D scene reconstruction.
The automobile industry entered the Warring States period
Although Xiaomi has obtained production qualifications, competition in the automotive industry is now becoming increasingly fierce. Can the fledgling Xiaomi car “get a share of the pie”?
Liu Feilei, secretary of the board of directors of GAC Aian, recently stated, “The automobile industry is entering the 'Warring States Era', and resources are being focused on leading companies at an accelerated pace.” He believes that the automobile market price war will heat up in 2023, market competition will enter the “knockout stage” stage, and 3-5 first-class leading enterprises will be formed in the future. The top five brands in the NEV market accounted for 50.1% of market sales in 2022, and the top five brands are expected to account for 80% of sales in 2030.
Earlier, Lei Jun also said, “When the electric vehicle industry enters a mature period, the world's top five brands will occupy more than 80% of the market share. In other words, the only way to succeed is to become one of the top five, and ship more than 10 million vehicles every year. The competition is going to be tough.”
In addition to the new car-building forces, traditional car companies have also transitioned into the new energy circuit one after another, and have a competitive advantage in terms of capital strength, car building experience, etc., putting some pressure on the new car builders.
Guotai Junan's research report points out that competition in the smart electric vehicle industry is fierce, and the product power of independent brands and new forces is rapidly increasing. Over the next few years, cost-effective models are expected to be marketed at an accelerated pace. Factors such as price competition may also cause the risk of new car sales falling short of expectations.
According to CITIC Securities research, advantages in supply chain, software, users, ecology, channels, etc. will help Xiaomi gain a place in the smart car market. Compared with other new car builders, it is expected to achieve the goal of annual sales of 100,000 vehicles and correction of gross profit more quickly, thus opening up additional valuation space in the order of 100 billion dollars. However, if Xiaomi is to succeed in building a car, it will face challenges such as high investment in R&D in the early stages, subsequent sales growth, and when gross margin will quickly return to a healthy level.
Editor/Jeffrey