Xiaomi Motors is accelerating its overseas expansion and will launch automotive sales business in multiple regions. | Exclusive from 36Kr.

Facing the red ocean market in China, the pace of Xiaomi Auto's overseas expansion is also accelerating.

36Kr has learned from multiple sources that Xiaomi is setting up an automotive overseas business.

Under the international department of the group, Xiaomi has added a preparation team for overseas sales business, and positions such as market research, project management, and electric vehicle after-sales engineers are being recruited.

Under the automotive department, Xiaomi's autonomous driving department has added several positions targeting the overseas market to address the regulatory verification and functional implementation of autonomous driving functions overseas. It can be predicted that autonomous driving will be one of the focuses of Xiaomi Auto's overseas expansion.

Insiders told 36Kr that after the team is formed, Xiaomi will conduct small-scale vehicle sales in multiple overseas regions to test the market response and prepare for the large-scale expansion of the overseas business.

From the perspective of business layout, the overseas sales of Xiaomi Auto will mainly be carried out through the Mi Home stores under the international department. Currently, Xiaomi has more than 100 directly operated stores overseas.

In response to this system, Xiaomi President Lu Weibing recently announced a significant goal to the outside world - planning to open 10,000 Mi Homes overseas in 5 years to bring the "Full Ecology of Human, Vehicle, and Home" and Xiaomi's new retail model to the international market.

In recent years, in addition to directly operated stores, thousands of authorized sales networks have made the revenue from overseas markets account for more than 50% of Xiaomi's total revenue. The user reputation and brand power established through products such as mobile phones and tablets have laid a solid foundation for the overseas expansion of automotive sales.

Relying on Group Advantages, Xiaomi Auto Is More Likely to Break Through Overseas Challenges

In July this year, Xiaomi transported two SU7s to France. In the Paris Museum District, Xiaomi held a special exhibition of the "Full Ecology of Human, Vehicle, and Home".

During this period, in response to the user's question of "When can Xiaomi cars be bought in France", Lei Jun's answer is: The goal is to strive to sell Xiaomi-branded cars in Europe before 2030. Judging from the formation speed of Xiaomi Auto's overseas team, this progress is likely to be accelerated.

Compared with other Chinese automakers, Xiaomi has more obvious advantages in the overseas field.

Before the automotive business generates revenue, Xiaomi's overseas market revenue has accounted for more than 50% of the group's total revenue. In Europe, a globally recognized high-net-worth market, in the third quarter of this year, Xiaomi's share of the smart phone market reached 18%, an increase of 1% year-on-year, ranking third. It is undeniable that Xiaomi already has a certain brand recognition overseas.

Industry insiders told 36Kr that the core challenge for Chinese automakers to go overseas is the establishment of brand power. "Indeed, many Chinese automakers have opened stores in Europe, but the number of customers entering the stores is far lower than that of European automakers. Many customers who are driven by curiosity leave after hearing the brand introduction."

The development of Xiaomi's international mobile phone business has indeed cleared the basic obstacles for the automotive business to go overseas.

Taking the European market as an example, although Xiaomi's strength is in online retail, its success in Europe is mainly based on the construction of offline channels, such as close cooperation with European operators and the implementation of localized marketing strategies.

Compared with other Chinese automakers, Xiaomi is obviously more familiar with the overseas market and has more rich operational experience, which will be beneficial for Xiaomi Auto to quickly achieve a breakthrough in the local market.

But there are still obstacles.

The Xiaomi SU7, which has a domestic price of more than 200,000 yuan, is positioned as a high-end model. Exported from China to overseas, tariffs and transportation costs will cause the price of the Xiaomi SU7 to continue to rise. In the overseas market, the SU7 will also be a product prepared for the high-end market. But Xiaomi's share in the high-net-worth market is not high.

According to the third-quarter data of the European market released by Canalys, the overseas sales of Xiaomi mobile phones are mainly supported by cost-effective products. In the high-end mobile phone field with a price of more than 800 US dollars (approximately 5,800 yuan), Apple's share is 77%, Samsung's share is 16%, and Xiaomi's share is less than 2%.

From the financial report data of Xiaomi Group, in the Internet business, the monetization ability of Xiaomi's overseas users is also much lower than that of domestic users.

If Xiaomi wants to export high-end models, one of the core problems it faces is the lack of recognition in the high-end market.

Can Xiaomi Break Through in the Export of High-End Electric Vehicles from China?

What is the current situation of the export of Chinese electric vehicles?

In Thailand, India, the Philippines in Southeast Asia, and Brazil and Mexico in South America, the export volume of Chinese electric vehicles is rising rapidly. This year, the Brazilian market has become the country with the largest export volume of Chinese electric vehicles with an export volume of 40,000 vehicles, surpassing Belgium.

In these markets, BYD has become the biggest winner. BYD's Dolphin, Seal, Yuan PLUS and other models are widely favored by users in Southeast Asia and South America.

The first stop for the export of high-end Chinese electric vehicles is often Europe. Automakers such as NIO, XPeng, and Zeekr have all laid out their overseas strategies in Europe.

According to data from the European Automobile Manufacturers' Association, in June this year, among the 200,000 newly registered pure electric vehicles in Europe, 23,000 were from Chinese brands, with a share of 11.1%.

Among them, SAIC MG4 EV sold 13,000 units. This best-selling Chinese automaker model in Europe has a price of 31,990 euros. The NIO ET5, with a starting price of up to 59,000 euros (approximately 480,000 yuan), sold only 34 units in Germany in the same month.

Economical and practical models are still the main way for Chinese automakers to achieve sales breakthroughs in Europe. The export of high-end models not only faces the problem of brand recognition, but also faces competition from local products - a Mercedes-Benz C-Class has a price of about 45,000 euros. Whether in terms of price or influence, Chinese high-end models are obviously less competitive compared to European local brands.

Xiaomi may have the possibility of breaking through.

The best-selling mobile phone in Europe is Apple, and the best-selling automakers are Volkswagen, Mercedes-Benz, and BMW. These three European local automakers have now given up following Apple Carplay updates and are investing a lot of money in developing their own vehicle infotainment systems. Due to the lack of a hardware foundation, European local automakers will focus on the development of single-vehicle intelligent experience for a long time in the future.

And Xiaomi just has a very unique competitive advantage: the "Human, Vehicle, and Home" ecological interconnection experience. With a mobile phone user base, Xiaomi has the foundation for creating an interconnected experience. The seamless interconnection between mobile phones and cars, as well as more gameplay brought by other smart devices, will be the key for Xiaomi to break through.

But to create such an experience overseas, Xiaomi will face data and regulatory issues. In addition, high tariffs and logistics costs will also increase the difficulty for Xiaomi's "Vehicle and Driver Interconnection" to attract users, making localized research and development and marketing crucial, which is exactly Xiaomi's strength.

The overseas expansion of automotive business for Xiaomi is not just about selling cars. The output of the "Human, Vehicle, and Home" ecological concept is the future direction of Xiaomi's overseas expansion. As one of the few companies in the world that manufactures both mobile phones and cars, and also has a certain user base and brand influence, Xiaomi carries the new expectations of the overseas expansion of high-end Chinese electric vehicles.