Xiaomi Enters Electric Vehicle Market With US$10 Billion Commitment

HONG KONG—Chinese electronics giant Xiaomi Corp. became the latest tech company to launch a foray into China’s burgeoning electric vehicle market, pledging $10 billion over the next decade to the effort.

Xiaomi Chief Executive Lei Jun will lead the new stand-alone subsidiary focused on electric vehicles, the company said Tuesday. It will spend an initial 10 billion yuan, equivalent to about $1.5 billion, to launch the new company, expanding its investment in the coming years.

Xiaomi’s entrance into electric vehicles makes it one of China’s most high-profile tech companies to date to join the increasingly crowded market for such automobiles. Xiaomi’s status as a popular consumer brand with a rapidly expanding global footprint, could give it an edge over its many rivals, though new entrants into the car market face significant hurdles.

Mr Lei appeared late Tuesday before a cheering theatre of spectators in Beijing following the announcement. He told the audience that he had deliberated for months with the company’s board about whether Xiaomi should enter the electric vehicle market. He said he ultimately decided that the company’s deep cash cushion gave him the confidence to move forward.

“We have accumulated a lot of wisdom and experience and it’s time for us to try the waters,” Mr. Lei said.

Mr Lei offered scant details on how or when any Xiaomi vehicle would come to market, and didn’t disclose whether it had enlisted an outside manufacturer for the effort. Last week, Chinese car maker Great Wall Motor denied a report that it was working with Xiaomi on electric vehicles.

China is the world’s largest electric vehicle market, and Xiaomi joins a crowded field of companies looking to compete in the business. Sales of electric vehicles have been booming since industry champion Tesla Inc. began building its high-end cars in Shanghai in late 2019. Domestic rivals include NIO Inc.—whose soaring stock has made it one of the world’s most valuable auto makers—as well as Li Auto Inc. and Xpeng Inc.

In January, search-engine giant Baidu Inc. disclosed that it was entering the electric vehicle market with partner Geely Automobile Holdings Ltd. Apple Inc. has been seeking partners to build electric vehicles since late last year, though talks to do so with South Korea’s Hyundai Motor Group broke down in February.

Xiaomi is betting that its entry into electric vehicles will build on its resurgent success in smartphones. In the fourth quarter, the company became the world’s third-largest smartphone maker behind Apple and Samsung Electronics Co., occupying that spot for the first time ever. Booming sales in China, India and Western Europe have fueled its rise, while troubles at its Chinese rival Huawei Technologies Co. have sent customers flocking to its cut-rate devices.

The details of Xiaomi’s electric-vehicle effort came toward the close of a roughly two-hour new product launch hosted by Mr Lei in Beijing on Tuesday. In addition to smartphones, Xiaomi sells an array of consumer devices, and Mr Lei spent most of the event revealing a grab bag of new gadgets, including an internet-connected air conditioning unit, a home humidifier and a new laptop.

Only at the very end did Mr Lei discuss Xiaomi’s electric-vehicle plans. As an image of Mr Lei with his arm around Tesla CEO Elon Musk flashed behind him, the Chinese CEO said he had been a Tesla owner since 2013, and long had an interest in the technology.

“I hope that one day there will be a Xiaomi car on each and every street,” he said.

A new investment fund targeting celebrity-founded consumer brands has secured US$40 million in commitments and is rapidly approaching its US$50 million fundraising target, signalling growing investor appetite for alternative opportunities beyond traditional asset classes.

The Global Talent Fund, which has a maximum raise of US$100 million, focuses on building and investing in consumer businesses alongside celebrities, athletes, and influential personalities who play an active role as co-founders rather than simply endorsing products.

The strategy is based on the belief that changes in consumer behaviour, particularly the rise of social media and digital engagement, have fundamentally altered how brands are built and scaled.

GTF founding partner Jeremy Hunt, who is helping lead the fund’s strategy, said consumers increasingly feel connected to personalities they follow online and are more willing to support products developed by those individuals.

“Consumers are searching for content to engage with, and when a celebrity they like or follow takes them on the journey of creating a product or brand, they genuinely feel part of that process,” he said.

The fund is targeting high-growth consumer sectors including wellness, hydration, beauty and recovery, areas Hunt believes continue to benefit from strong global demand and ongoing innovation.

Rather than backing celebrity endorsement deals, the fund is seeking businesses where talent is deeply involved in product development, brand creation and long-term growth.

According to Hunt, authenticity remains one of the biggest differentiators between successful celebrity-backed brands and those that fail.

“The consumer can see clearly if someone is simply being paid to promote a product,” he said. “The winners are typically the brands where the celebrity has genuinely helped build the business from the ground up.”

The model has attracted support from several prominent Australian investors and business families, reflecting broader interest in alternative investments with global growth potential.

Hunt said consumer brands offered a level of tangibility that many investors found appealing.

“Consumer brands are what we touch, feel, smell and taste every day,” he said. “Our investors understand the growth potential in the model, but they also want to be part of the journey.”

The fund’s rapid progress towards its fundraising target comes amid growing recognition that celebrity influence, when combined with strong commercial execution and scalable business models, can create significant enterprise value.

With several high-profile celebrity-founded businesses generating billion-dollar exits in recent years, supporters of the strategy believe the opportunity remains in its early stages.

Xiaomi Enters Electric Vehicle Market With US$10 Billion Commitment

Chinese smartphone giant joins crowded but burgeoning automobile market.

With US$40 million already committed, the Global Talent Fund is attracting investor attention with a strategy focused on building globally scalable consumer brands alongside high-profile talent.