Xiaomi has been working on an electric car project called Xiaomi Car for years, and after investing nearly $11 billion, the company was about to publish its first prototype. The car will be shown in a few weeks.
And while the company had been expecting to go into mass manufacturing in 2024, it turns out that the Xiaomi Car has seen a roadblock to its near appearance suddenly and unexpectedly.
The market for electric cars (or so-called electric vehicles) has recently begun to spread, and China is one of the countries that has seen the highest increase in this particular category. However, as a new business, there are many new companies that try, but fail in the process.
The Chinese auto industry has been hit hard by the recent high-profile bankruptcy wave, and authorities are ramping up approval requirements for any new auto project. Therefore, the company requires additional documents to prove not only its financial capabilities but its technological knowledge as well.
Xiaomi Car needs additional revisions to enter production
Of course the additional paperwork needs to be reviewed which is likely to take months, additional requests can also be generated for additional information, but if the request to manufacture the car from Xiaomi Car is rejected, the company will need to start the process over.
Unfortunately, Xiaomi will not wait for the electric car sector to be ready, as competitors continue to advance at a rapid pace and the longer the company waits, the faster it needs to run behind competitors, and this will certainly not be easy.
Xiaomi has recorded its first decline in phone sales, but the electric car sector may bring more customers and raise sales, but the company will need to invest a lot in it, and therefore potential delays may harm the company and the Xiaomi Car project.
The sudden obstacle in the face of the Xiaomi Car
The license is the unexpected obstacle, which may delay the start of production and increase the financial burden, but the company stresses that the research and development phase of the first Xiaomi car has already been completed, and that the lack of a license will not stop the design process or manufacturing preparations, as the company already employs more than 1,000 An employee has acquired the land where she wants to build her factory, and there is hope to start selling the car in 2024.
Thus, no license is a barrier between final production, but the whole process may add a few months and maybe even a year to the planned schedule, and of course it will require additional investment.
according to Lei Jun The company invested $10 billion over many years to start the project, however the company will need to invest some of that money a little earlier than thought, and of course the market doesn’t absorb this easily, especially since there is no guarantee about the success of Xiaomi Car in the industry, and the Shares drop 5.4% in Hong Kong, will Xiaomi succeed in overcoming this crisis?
What do you think of electric cars?