Xiaomi CEO says Donald Trump sanctions triggered Chinese Xiaomi’s entry into electric vehicles.
The Trump administration’s decision to impose sanctions on China’s Xiaomi Corp (opening a new tab in early 2021) was the catalyst for the company’s decision to produce its first electric car, company CEO Lei Jun said in a statement.
Xiaomi, best known for its smartphones and home appliances, entered China’s crowded electric vehicle market this year as part of a strategy to diversify its product portfolio.
Lei said Xiaomi started thinking about making an electric vehicle after what he called ‘an accident’, an announcement in the waning days of the Trump administration that put the Chinese company on the US sanctions list: “I got a call from a friend saying we were sanctioned. It was like out of the blue. Without the huge impact of the unexpected US sanctions, we would not have rushed into the complex automotive industry.”
The day’s event, in which Lei detailed Xiaomi’s attempt to launch an electric vehicle that would attract buyers from Tesla and established luxury brands like BMW, Audi and Mercedes, was watched by more than 1.5 million people on WeChat.
Xiaomi challenged the 2021 sanctions in federal court and in May of that year won the cancellation of the action that would have restricted US investment. By then, Lei said they had started development of the SU7, a sporty, Porsche-looking EV starting at under $30,000.
Xiaomi plans to deliver at least 100,000 SU7 EVs this year with a sales target of 120,000. This represents a significant increase from earlier this year, when the company set a first-year sales target of 76,000 vehicles when setting its production capacity.
But Donald Trump’s fight with China is far from over. Although the Republican presidential candidate has said he would support Chinese investment in US facilities if re-elected, he has also announced import tariffs of up to 200 percent on Chinese electric vehicles made in Mexico.
