Xiaomi has become the fourth company to receive NDRC approval since the end of 2017, bringing it one step closer to mass production of EVs, according to Reuters.
Xiaomi has reportedly received approval from China's top economic planner to produce electric vehicles (EVs), marking a key development in its car-making efforts.
The National Development and Reform Commission (NDRC), which oversees new investment and capacity in China's auto sector, gave the nod for EV manufacturing to Xiaomi earlier this month, Reuters said in a report today, citing two people familiar with the matter.
Beijing-based Xiaomi becomes the only fourth company to receive NDRC approval since late 2017, the report noted. Over the past few years, China has tightened its regulations on qualifying for vehicle production.
While the NDRC approval brings Xiaomi one step closer to mass production of EVs, it still needs to obtain approval from China's Ministry of Industry and Information Technology (MIIT), which is responsible for evaluating the technical and safety requirements of new automakers and models, according to the report.
On March 30, 2021, Xiaomi made an announcement on the Hong Kong Stock Exchange that it plans to set up a wholly-owned subsidiary to take charge of its smart EV business.
Xiaomi's initial investment in the automotive business would be RMB 10 billion ($1.4 billion), with an expected investment of $10 billion over the next 10 years, it said at the time.
On October 19, 2021, Xiaomi's founder, chairman and CEO Lei Jun said that Xiaomi's car-making business was progressing beyond his expectations, and that the first car was expected to be officially mass-produced in the first half of 2024.
On March 5 this year, Lei reiterated that Xiaomi's first EV would be mass-produced in the first half of 2024 and that the model had already completed winter testing.
Xiaomi plans to produce about 100,000 EVs next year, the Reuters report today said, citing a source.
Beijing Daily reported in July that Xiaomi had completed construction of a factory facility in Beijing that can produce 200,000 EVs a year while awaiting approval.
The company has also accelerated hiring at its EV factory since last week in preparation for a December ramp-up in production, two Xiaomi employees told Reuters.
Xiaomi's first model will be a LiDAR-equipped sedan, with a premium version priced at more than 300,000 yuan, local media outlet LatePost reported on September 2 last year.
Yesterday, another local media outlet, Jiemian, reported that Xiaomi's EV division had chosen CALB and CATL as the tier 1 and tier 2 suppliers of power batteries, respectively.
Xiaomi's EV business will rely on software, rather than hardware, to make money, Jiemian said, citing an insider at the company.
In order to maintain Xiaomi's cost-effective edge, the company's EV business will keep its margins on components at around 1 percent, with future profitability relying mainly on software and eco-services, the source said.
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