Xiaomi may make electric cars with China’s state planner’s clearance.
It represents a significant step towards the smartphone maker’s objective of producing cars by the beginning of next year.
According to the persons, the National Development and Reform Commission (NDRC), which oversees new investments and production capacity in China’s car industry, approved Beijing-based Xiaomi’s plans to manufacture EVs earlier this month.
Only four ventures since the end of 2017 have received NDRC approval, including Xiaomi’s.
More than two years after initially announcing its plans, Xiaomi is now one step closer to mass-producing electric vehicles, but the project still needs approval from the Ministry of Industry and Information (MIIT), which evaluates new manufacturers and models for technical and safety standards.
And it would do so at a time when China’s auto industry is grappling with a number of problems, including a capacity glut and sluggish demand that have sparked a brutal price war and hurt supplier margins.
Xiaomi stated a target of mass producing its first cars in the first half of 2024 and promised to invest $10 billion over a ten-year period in the automotive industry.
The NDRC has been hesitant in approving new EV production plans of companies because to concerns about overcapacity and falling demand in the market, therefore there were questions as to whether the timeframe could be met.
According to Reuters, Tesla’s plan to expand its Shanghai plant has not yet received approval.
Cars Production in China
Additionally, industry insiders recently told Reuters that although U.S. luxury EV maker Lucid Group is eager to produce cars in China, it has been warned that the likelihood is slim.
Reuters was unable to ascertain the rationale behind the NDRC’s approval of Xiaomi right away.
The Beijing city administration has designated its EV facility as a significant industrial upgrade project.
When contacted for comment, Xiaomi, which owns the third-largest smartphone brand in the world by shipping, did not immediately answer.
Faxed requests for comment from the NDRC and MIIT likewise did not receive an instant response. As the situation is private, the sources declined to give their names.
According to a report in the official newspaper Beijing Daily in July, Xiaomi moved through with the project as it awaited approvals, finishing the development of plant facilities in Beijing that can produce 200,000 EVs annually.
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