Why Xiaomi Succeeded In Becoming An Automaker While Apple Failed
- Xiaomi’s SU7 EV sedan has put the tech company on the map as a serious EV maker.
- The electronics company has developed a comprehensive ecosystem in which its cars are part of.
- Being able to control the supply chain in China is a key to the rapid success of Xiaomi.
Cast your mind back a few years, and the internet was rife with speculation that Apple was about to launch its own automobile. The tech giant had been linked to partnerships with all kinds of automakers, including Hyundai, Kia, Porsche, BYD, and Toyota. However, early last year, reports emerged that the ambitious project had officially been canned, with up to around 600 employees given their marching orders or being retrenched within the company.
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While we may never know just how close the world came to an “iCar”, what we do know is that one of Apple’s tech rivals has quietly gone about bringing its own EV to market. That rival is Xiaomi, another tech company that managed to sell 135,000 units of its SU7 in China since it debuted in March 2024.
Read: Apple Lays Off 614 Workers After Canceling Electric Car Project
While Xiaomi is best known in the West for its phones, at home, the company has developed a connected ecosystem of consumer products that even the likes of Apple, Samsung, and Google can only dream of. From smart lights to air purifiers to robot vacuum cleaners to blenders, the company offers a wide range of consumer tech products, all of which are controlled from one app. And that’s exactly why a car is a great addition to the company’s lineup.
All About The Ecosystem
Nowadays, tech companies aren’t interested in selling you a singular device – they’re more invested in offering a whole ecosystem, the benefits of which can only be truly reaped once you commit to a company’s products. Whether it be the ease with which an iPhone can communicate with a Macbook or how seamlessly a Galaxy smartphone can stream to a Samsung TV, ecosystems are all around us. Even cars are judged based on whether they offer CarPlay or Android Auto.
However, Xiaomi offers buyers more than just an infotainment system. By selling its own car, Xiaomi can potentially attract clients to its network of connected devices like never before. The SU7 can use data collected from those other devices to ready itself for a user’s routine, such as determining the best time to recharge the car’s batteries.
“Xiaomi has really started infiltrating your home,” said Gary Ng, an economist with Natixis Corporate & Investment Banking, speaking to the New York Times. “Everything is linked together, and this is something other companies couldn’t do.”
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China’s Supply Chain Success
Another factor that allowed Xiaomi to develop its first car quickly is the environment in which it operates. China’s electric car makers have been the beneficiaries of billions of dollars worth of state support. The supply chain for EVs is practically wrapped up inside the nation, with Xiaomi securing battery supplies from BYD and CATL, two of the world’s largest battery makers. The company then took over a manufacturing plant from Beijing Auto Group before pumping out its new sedan.
In all aspects, Xiaomi managed to hit the ground running. Now, with plans to launch a second car in the form of an SUV, and construction of a new manufacturing plant well underway, its automotive plans are full steam ahead.
See Also: Xiaomi President Confirms Global EV Expansion Coming Soon
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Of course, success is still far from guaranteed. The company faces intense competition from a wide range of home-grown rivals, including electronics rival Huawei, which has teamed up with multiple automakers.
But Xiaomi is also putting up a fight against foreign brands. With the SU7 starting at just $30,000, it offers Porsche-like looks with class-leading tech. Coincidentally, in the year since the Xiaomi SU7 was launched, Porsche’s sales in China were down 30 percent.
With more and more Chinese automakers looking for success outside of their home nation, it could be a matter of time before more of the globe starts seeing the SU7 as a compelling option.
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