[Beijing Diary] Why You Should Pay Attention to Xiaomi Cars

Major Specifications and Appearance Followed by Price Reveal
From Razors to Electric Vehicles... Building the Xiaomi Ecosystem
Attention Needed on Vehicle Completeness and Scalability

If asked recently which company in China is receiving the most attention, it would probably be Xiaomi (小米), which launched the electric vehicle SU7 (Chinese name: Suchi) on the 28th. In Korea, Xiaomi is known as the "Accidental Empire" due to its popular cost-effective (price-to-performance) robot vacuum cleaners, air purifiers, and charging batteries. While there may be minor complaints, Xiaomi has consistently received favorable reviews from Koreans despite distrust of Chinese products and unfriendly bilateral sentiments.

The market reaction to Xiaomi's first electric vehicle SU7 will undoubtedly serve as an opportunity to assess the potential of the company. This is not only a moment of expansion from lightweight, compact products like small home appliances and mobile phones to the substantial and large-scale automobile sector, but also a chance for Xiaomi to become the entity that connects daily life and devices more closely than anyone else worldwide. Therefore, observing SU7 and Xiaomi goes beyond simple pro-China or anti-China debates; it is necessary to instill a sense of urgency and accelerate industrial policies that Korea must feel.

First, attention should be paid to the value of the SU7 as an "automobile" itself. Like most Chinese automobile brands, its reputation in the global market is relatively short. There have also been limitations due to restricted disclosure of information related to safety accidents. However, Xiaomi partnered with Beijing Automotive Group (BAIC), which, as is well known, has been a long-time partner of Mercedes-Benz. The SU7 is produced at BAIC's Beijing factory, with an expected annual production capacity of 200,000 units. Although Mercedes-Benz has struggled in the electric vehicle sector, it is a leading company whose vehicle movement and steering have been verified over a long period. Of course, it remains necessary to monitor whether the high-end specifications Xiaomi announced are properly implemented in the actual vehicle and its durability.

One impressive point was the scale of charger-related testing mentioned by Xiaomi Chairman Lei Jun at the launch event on the 28th. He stated that rapid and slow charging tests were completed through 148 charging brands, and over 500 issues identified during the process were resolved. This attitude seems to say to consumers worried about the "brick phenomenon," one of the biggest headaches in the current electric vehicle market, "We anticipated this and prepared everything." It can also be read as overall confidence in the product's completeness.

Secondly, the ecosystem Xiaomi will build is worth attention. If the announced SU7 successfully links with existing home appliances and communication products, Xiaomi will create an unprecedented Internet of Things (IoT) ecosystem. When household air purifiers, air conditioners, robot vacuum cleaners, refrigerators, and washing machines are connected with the vehicle, it will be possible to manage users' conditions and demands much more closely. The accumulated database (DB) and the loyalty of Xiaomi fans, called Mifen (米粉), will be invaluable. Conversely, if the market entry fails, Xiaomi's position in the existing home appliance and mobile phone markets could also be shaken.

Lastly, Xiaomi has demonstrated scalability. With the launch of the SU7, Xiaomi swept the vehicle aftermarket. Vehicle refrigerators, physical buttons, wrapping, vehicle air fresheners, and beverage cups were all released under the Xiaomi name. Additionally, bags, T-shirts, and hats matching the SU7's nine colors were introduced. These were designed without straying far from Xiaomi's identity and reflected the tastes of the core target demographic of 20- to 30-year-olds. While consumer satisfaction with the actual vehicle and related products must be observed, this shows Xiaomi's ambition to provide solutions from head to toe, from morning to night.

There will also be potential crises exposed with the SU7 launch. Since it is released at a quasi-premium price, consumer demands and expectations will be relatively high, leading to many complaints regarding accidents, malfunctions, and infrastructure such as charging stations. Moreover, the image of Xiaomi as a company that alleviates the financial burden on ordinary people while providing convenience may be diluted. However, if Xiaomi overcomes these challenges and gains competitiveness, the Xiaomi of that time will not be the Xiaomi of today.