By Michael Elkins
A recent report by Bloomberg suggests that Smartphone maker Xiaomi (OTC:XIACF) Corp (OTC:XIACY) is considering a production partnership with Beijing Automotive Group Co (HK:1958). The interest in partnering with BAIC comes as Xiaomi Corp faces delays in acquiring a license to make cars on its own.
Xiaomi and BAIC are exploring various options including Xiaomi buying a stake in Beijing Hyundai No. 2 plant, which has a license to make cars in China, the Bloomberg report said, citing people familiar with the matter.
According to the report, the collaboration could see vehicles built by Beijing Automotive’s EV brand, BAIC BluePark New Energy Technology Co. and co-branded with Xiaomi.
Shares in BAIC Motor Corp., which counts BAIC Group as its controlling shareholder, surged as much as 30.5%, their biggest intraday increase on record.
Xiaomi committed to bringing its cars to mass production in the first half of 2024. Earlier this year, the company started construction on its first auto factory in Beijing after declaring its ambition to enter the competitive EV sector and challenge established brands and newer tech companies.
Citing people familiar with the matter, the report states that deliberations are preliminary and there’s no guarantee that the negotiation would lead to an agreement. However, an executive at Beijing Electric Vehicle Co, BAIC's EV unit, told Reuters that he is not aware of such talks between Xiaomi and BAIC, declining to be named because he is not authorized to talk to media.