At the end of last month, Lei Jun said he would bet his whole life's reputation on his last entrepreneurial project-building a car.

Lei Jun personally led the team and set up a wholly-owned subsidiary in charge of the intelligent electric vehicle business. It did not accept any external funds, invested 10 billion yuan in the first phase, and invested 10 billion US dollars in the next 10 years.

All these make the passionate XIAOMI car has attracted a lot of attention before it comes out.

So how on earth will XIAOMI build a car?

Just last night, Lei Jun revealed more "inside information" about XIAOMI cars in the studio.

XIAOMI car from 100000 yuan, car or SUV, released 3 years later.

This is Lei Jun's third live broadcast on Douyin. Just after the live broadcast, Lei Jun was still introducing the green bags sold for 1 yuan. Viewers were already shouting in the comments area:

Boss Lei, get in the car!

An hour later, the car circle appeared from the media man Han Lu and asked about XIAOMI's car building that everyone was concerned about.

With regard to the reason why he decided not to make a car at first and now decided to be a XIAOMI car, Lei Jun said that it was because he wanted to gather the mobile phone industry in the past, and in recent years, the mobile phone business was getting better and better. At the appeal of fans, after 75 days of research, he made up his mind to "kill" into the car-building field.

Han Lu questioned the 75-day consideration. After all, building a car is no small thing.

Lei Jun said: it is true that a lot of accumulation has been made in cars in the past few years, and many departments have linked with cars and set up hundreds of patents, but the project for the whole vehicle has just been established.

If the project has just been established, it will take at least 3 years for a car to be delivered to the user.

As the first batch of investors of NIO Inc. and XPeng Inc., Lei Jun was naturally asked what new bright spots XIAOMI would have in battery and system after 3 years.

Lei Jun did not give details, but firmly said:

For me, the first battle is the decisive battle. When XIAOMI releases the car, it will certainly represent the cutting-edge technology and cutting-edge level at that time. I would like to rest assured that XIAOMI's R & D team and R & D funds are very sufficient. Mobile phones and cars are connected with a lot of technology. XIAOMI Automobile three years later will definitely live up to everyone's expectations.

At the same time, Lei Jun also mentioned the intelligent experience that XIAOMI will bring to consumers in the use of cars.

For example, everyone knows not to turn on the air conditioner to sleep in the car in summer, because there will be accidents. So why don't today's cars have fresh air conditioners?

For example, if we are in the north, the weather is very dry in winter, why can't cars have humidification function?

For example, the air pollution in many places is very serious, why don't you bring your own air cleaner in the car?

For example, it is very hot in the car in summer, why can't you just pick up a glass of ice water? As long as we don't put in cold beer, because you can't drink while driving.

Lei Jun said with a smile. Many companies are thinking about how to get these things into the car, and XIAOMI intends to make them directly into the car. Lei Jun continued:

The key point of XIAOMI's first generation of cars is not how much to do, but how much to reduce.

With regard to the issues that people are more concerned about, such as what car and price XIAOMI is going to build, after all, there is no real launch, so although Lei Jun did not give a clear answer, he also gave a range.

Lei Jun said that what car model XIAOMI was going to make was discussed within the first month, but it was uncertain after 75 days of discussion.

They want to hear the voices of users, so after Weibo Corp published his vote, they saw that 45% wanted to be a car, 40% wanted to be a SUV, and the remaining 10% wanted to be a sports car and an RV.

So Lei Jun said, "the first car is definitely not a sports car and an RV, not a car or a SUV."

As for the price, Lei Jun also said that he would listen to the voices of users, and they all want XIAOMI to make a car with more than 100000 yuan.

XIAOMI's first car will be a middle-and high-end car with a price range of about 10-300000.

However, Lei Jun also said that if users like RVs, they will also consider customizing XIAOMI's smart RVs in the future.

In the studio, Han Lu also asked whether XIAOMI Automobile would use the new logo bought by XIAOMI 2 million, and whether it would continue to use the brand name of XIAOMI. Lei Jun said that he did not agree yet, and that after a period of time, he would continue to share more information about XIAOMI Automobile with you.

Now many car-building enterprises will be said to be PPT car-building, for financing, we pay all the money this time, so please do not sweat, we have considered numerous difficulties and problems, this time I will unpack the burden, we will try our best to build a good car for everyone.

Is it reliable for XIAOMI to build cars?

XIAOMI Automobile has always been the first among the "rice noodles" in wish list.

Lei Jun has shown great interest in the electric car industry since 2013.

Although XIAOMI's car-building has spread all over the city since 2013, and XIAOMI has refuted the rumors many times, it is also during this period that XIAOMI began to act silently.

When XIAOMI announced the construction of a car, Lei Jun thought that XIAOMI's entry into the automobile field had the following three advantages:

XIAOMI has the most perfect intelligent ecology in the world.

XIAOMI has a team of more than 10,000 engineers.

XIAOMI is supported by the third mobile phone business in the world.

One by one, the intelligent ecological chain is indeed a great advantage of XIAOMI.

Cars used to be one of the industries with the highest barriers, but electrification, intelligence and networking gave technology companies the best opportunity to enter the game. Next, powertrains such as engines and gearboxes are no longer the key competitiveness.

Software, service and ecosystem will be the core of the automobile in the future.

Now XIAOMI already has the largest intelligent hardware Internet of things platform in the world. From the entire home environment to every household product, Mi's intelligent ecology is spread all over the "food, clothing and housing", and then there is only "travel" to make up.

Next, after opening up the field of intelligent travel, it will have a synergistic effect with XIAOMI's AIoT to create a full scene of their own intelligent life, and for consumers, they can also have a more comprehensive and systematic intelligent experience.

Many software architectures and technologies are the same, such as cloud services and Internet services.

However, to move the whole ecological chain to the car, it has to go through a new layout.

The automotive industry needs a very strong ability to integrate technology, not just ecological advantages.

XIAOMI has a certain accumulation in intelligent cockpit, the integration of car and mobile phone, and artificial intelligence, but in the important self-driving technology, it can be seen from the fact that XIAOMI has less applications for automobile patents. XIAOMI has a deficiency in this field.

In order to quickly catch up with the reserves at the technical level, XIAOMI has been stepping up efforts to establish a corresponding talent team and investment layout.

Since 2013, Lei Jun has called on Tesla, Inc. CEO Musk twice to learn lessons, and has successively begun to invest in nearly 10 companies in the field of smart electric vehicles, including NIO Inc. and XPeng Inc., as well as Beixing, which is doing lidar, and che Mi Technology, which is doing automotive technology research, and so on, constantly storing for the final unveiling.

For XIAOMI, who has always pursued "fast", he is also attracting talents to achieve "stones from other mountains to attack jade".

XIAOMI began serious research on car construction on January 15, 2021, and now has a team of more than 10,000 engineers, which will enable XIAOMI to further study the development of chips, batteries, chassis, motors and other configurations.

Outside of the software, the ability of the whole vehicle is the most important.

On the whole industry chain, China has actually built the most complete smart car industry chain in the world, which also provides fertile soil for XIAOMI: from R & D and production of key components to vehicle design and manufacturing, logistics and warehousing.

However, XIAOMI does not seem to want to find contract manufacturers to integrate other people's production lines and master their own software technology, as Internet companies did before, but to become a vehicle manufacturer.

In fact, many of XIAOMI's existing supply chain partners also cover the automobile part, but just like moving software technology to the automotive field, it is not easy to transfer XIAOMI's experience in the combination of hardware and software to the automobile.

Building a car is completely different from building a mobile phone, and it is many times more complicated than building a mobile phone.

Citigroup pointed out in the research newspaper:

Car building is an asset-heavy business, which will consume a lot of resources and bring long-term financial burden to the company, which may have an impact on the current profitability of the company.

Fortunately, XIAOMI said he had enough money to face the cross-border game.

It's just that the 10 billion investment in the first decade mentioned by Lei Jun is actually not much more than the top players in the industry, but it can still make XIAOMI appear to be on the ground and reliable in the early stage of building a car.

Lei Jun also said at the press conference that as of December (last year), XIAOMI had 108 billion yuan in cash. As for the funds needed to build a car, Lei Jun said arrogantly:

We can afford to build cars.

On the day after XIAOMI announced the construction of the car, XIAOMI's share price rose by nearly 6% in intraday trading, and the company's market capitalization has increased by more than 20 billion.

However, this 108 billion yuan is not a fixed asset, not to mention that building a car has a great test on cash flow. Letv spent money too fast because his car-building business was so fast that he was unable to save it in a critical moment.

Although it is supported by the third-largest mobile phone business in the world, XIAOMI also has a huge existing business to manage. XIAOMI also said that he does not accept foreign investment at present.

But this is also a good thing for consumers, because in this way XIAOMI can take the initiative in building cars, without considering the interests of many parties, and make the products they think users and the market like best.

It's just that this car may no longer be the "first car for young people" with high performance-to-price ratio.

XIAOMI has planned to enter the high-end market and get rid of the "low-end" stereotype. The car is the top brand for XIAOMI to move towards the high-end market. With the intelligent trend of the automobile industry in the future, the cost of making a car will become higher and higher.

How to meet the favor of more consumers again in the field of automobile consumption, which pays attention to brand honor and full of disdain chain, is also the next challenge for XIAOMI.

Similarly, XIAOMI's deep understanding of users, as well as rice noodles with strong loyalty, as well as XIAOMI's product experience and business model, are XIAOMI's unique highlights in Internet business.

Generally speaking, the environment is right, the timing is right, XIAOMI also has its own absolute advantages, but whether XIAOMI can succeed in building a car depends on the core technology, the adaptation of software and hardware experience to the automotive field, sustained capital investment, whether fans can be converted into sales, and so on.

However, now that Lei Jun has announced it, it shows that he is ready, just like when someone lamented XIAOMI's luck, Lei Jun said:

We are not speculators of any kind, but fate favors those who are prepared, that's all.

The surging "car-building" mobile phone brands

After the rise of new car-building forces such as NIO Inc., ideal and XPeng Inc., as well as Internet companies dabbling in the car-making industry, XIAOMI is now the second team to enter smart electric vehicles.

Instead of catching up with the first wave of craze, we can learn from the experience of our predecessors.

But the second wave does not mean it is easier to build cars. With the entry of Apple Inc, Huawei and other mobile phone manufacturers, XIAOMI is about to face more fierce competition.

These mobile phone manufacturers not only have the advantages of software, but also have a strong appeal to the new generation of consumers.

So why do all mobile phone manufacturers start making cars?

Take XIAOMI as an example. Although XIAOMI ranked fourth in world mobile phone shipments in 2018 and entered the top three last year, mobile phone revenue accounted for 59% of total revenue in XIAOMI's 2019 annual report. its gross profit accounts for only 5.7% of the total gross profit, we can see that the mobile phone business is actually not so profitable, and it is very difficult for XIAOMI's mobile phone to compete.

In fact, the global mobile phone market has also reached a state of saturation, the competition among mobile phone manufacturers has intensified, and it is very difficult for smartphones in the Internet era to continue to expand.

Cars are the next tuyere for these mobile phone manufacturers.

And the auto industry is accelerating the digital transformation, in this excellent opportunity, if you want to continue to develop, if you want to continue to make money, car building has become unstoppable.

In a summary of XIAOMI's car-building exchange, XIAOMI also mentioned that the opportunity of the automobile market is ten times that of the mobile phone market (10 trillion).

At the same time, the government is also supporting new industries related to car manufacturing, and the National Plan also mentions that by 2025, the sales of new energy vehicles in China will reach about 20% of the total sales of new cars. However, by the end of 2020, the number of new energy vehicles in China is only 1.75%.

Within this 18.25% gap, a huge gold mine is waiting for eager contestants.

At present, Huawei has completed the comprehensive layout of self-driving technology, intelligent technology and three power systems. Huawei's HiCar ecological partners already have 30 car factories, such as Audi, FAW and Chery. At the same time, it is a notice to join hands with Changan Automobile and Ningde era to go deep into the manufacturing end of the automobile industry chain.

In fact, Apple Inc's intention to build a car has been rumored since the era of Jobs. Although there have been many rumors in recent years, he has not formally responded, but Apple Inc has obtained a large number of patents in areas such as self-driving, electric cars, intelligent cockpits, and so on. Silently layout.

XIAOMI's advantage does not seem to be so strong compared to the two, but various mobile phone manufacturers are still acting non-stop.

Samsung launched its first Samsung car SM5 in 1998, but it disappeared. The year before last, it launched ExynosAutoV9, the first self-driving car chip released by United Audi, and is now further developing the next generation of self-driving chips in an attempt to master the core technology.

And Jovi InCar,OPPO, a brand new brand of vivo's car networking products released last year, is also working with ideal ONE to connect cars and machines.

Many mobile phone manufacturers join the ranks of car manufacturing, which not only plays a good role in promoting the innovation of the electric vehicle industry, but also can drive the development of the whole electric vehicle industry.

But at the same time, they should also continue to improve technology, promote the landing of products, pay attention to the risks brought by short-term investment, vicious competition and marketing wars, and work together to bring more new forces to fill the shortcomings of the domestic automobile industry.

For example, the problem of "lack of core" in the automobile industry is becoming more and more serious, the chip is also a huge deficiency in the domestic supply chain, and the key components are all monopolized by foreign countries.

In the future battlefield full of gunpowder, China's new energy vehicles are bound to become a key part of the global automobile market.

Who is the number one player is not known, but as Lei Jun said:

It's time for a big fight.