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Xiaomi Discusses Contract Manufacturing of SUV Models with Baic Bluepark and Brilliance Auto

October 22, 2023
in Technology
Xiaomi Discusses Contract Manufacturing of SUV Models with Baic Bluepark and Brilliance Auto
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Recently, a source close to Xiaomi revealed that at the end of August this year, Xiaomi was in talks with JAC Motors regarding the outsourcing of new energy vehicles. However, the two parties did not reach a final agreement. In October, Xiaomi started negotiations with Baic Bluepark and Brilliance Auto on production and other matters for potential cooperation.

The informant revealed that the cooperation between Xiaomi Automobile and Baic Bluepark is progressing deeper, and both parties are interested in further negotiations. However, the specific form of cooperation is still unknown.

Xiaomi‘s car division has planned to build a complete vehicle factory in two phases in Beijing Yizhuang. The first phase of the factory has been completed and put into operation, with an annual production capacity of 150,000 vehicles. Given that Xiaomi already has its own factory, why does it still need to collaborate with other car manufacturers?

Insiders have revealed that after the launch of its first coupe model, Xiaomi plans to introduce an SUV model. However, Xiaomi is currently not considering building a new production line. While producing coupe models in its self-built factory for Xiaomi Automobile Phase 1, Xiaomi will also collaborate with other car manufacturers to outsource the production of SUV models, enabling dual-track progress.

“The future success of Xiaomi‘s car becoming a hit product is still uncertain, so Xiaomi is considering whether to produce its own SUV models.” The informant believes that collaboration is the most optimal solution for Xiaomi‘s car to quickly scale up and save money.

“Lei Jun’s goal for 2024 is to sell 100,000 Xiaomi cars, but the production capacity of the Phase 1 factory cannot meet the demand in the short term. The construction of the Phase 2 factory will take two years to complete,” he added, “Introducing new car models is also crucial for Xiaomi cars to have a breakthrough in the first year. The more car models there are, the easier it will be for Xiaomi to achieve its sales target of 100,000 units.”

SEE ALSO: Xiaomi Qualifies for Electric Vehicle Production, Advancing Car Manufacturing

However, whether the cooperation with other car manufacturers can ultimately be successfully implemented is still unknown. The informed source also stated that Xiaomi still has concerns about the collaboration and is still weighing the issues of cost, technology, and marketing.

The informed source said, “Currently, the biggest concern for Xiaomi‘s car is production capacity, followed by marketing and how high sales can reach. Qualification for manufacturing cars is not Xiaomi‘s top priority.”

Automobile companies need to obtain approval from the National Development and Reform Commission (NDRC) and the Ministry of Industry and Information Technology (MIIT) to produce new energy vehicles. This is commonly referred to as having “dual qualifications” in the industry. According to a report by Reuters at the end of August, Xiaomi has obtained NDRC’s approval for its application to produce electric vehicles. Additionally, prior information from insiders revealed that Xiaomi‘s car division can expect MIIT’s approval by the end of this year at the latest.

On October 13th, Ming-Chi Kuo, an analyst at TF International Securities Group Limited, posted on social media that the estimated shipment volume of Xiaomi‘s first car is 50,000 to 60,000 units. The key selling points are autonomous driving, software ecosystem, 800V fast charging and power configuration. The estimated price is expected to be below 300,000 yuan (approximatly $41,041).

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