Xiaomi shares jump after Lei Jun's announcement of EV release date

After Lei Jun, CEO of the Chinese smartphone giant Xiaomi, announced that the company would begin mass production of its own electric vehicles in the first half of 2024, Xiaomi stock has responded with a rise. Immediately after the release of this information, Xiaomi shares in Hong Kong jumped more than 5%. The market cap is HK $ 564 billion.

Back in March, Xiaomi announced that it plans to invest $ 10 billion in the auto business over the next 10 years. These plans were confirmed last month when Xiaomi officially registered its electric vehicle business, Xiaomi EV Inc. The new company now employs 300 employees, and Lei Jun personally heads the team, who said that he was ready to risk everything and very much believes in the success of this project.

The potential for the Chinese electric vehicle market is enormous. In this country, almost one in five cars registered in the last month is an electric car or a hybrid. Even the Chinese search giant Baidu launched its own electric car company in January.

Over the past few years, China's electric vehicle sector has received favorable government assistance that has propelled the industry forward. There will be 1.9 million electric vehicles sold in China in 2021, up 51% from last year, according to research firm Canalys.

When Xiaomi launches its own electric vehicles in 2024, it will face a lot of competition from companies like BYD, Nio and Xpeng, as well as Tesla of course.

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