Why a Chinese gadget company can make an electric car and Apple can't

After nearly a decade of trying, Apple finally gave up its effort to produce an electric car last year, canceling a project that soaked up $10 billion.

But last year in China, electronics maker Xiaomi launched its first electric car after just three years of development and delivered 135,000 vehicles. It has vowed to double that number in 2025.

Xiaomi's ability to succeed where Apple could not shows how thoroughly China has come to dominate the supply chain for electric vehicles. Chinese companies have mastered electric vehicle manufacturing. By tapping that infrastructure, Xiaomi was able to get components quickly and cheaply.


More Chinese electric vehicle companies are starting to turn a profit after burning cash for years in their intense competition for the world's largest auto market.

Xiaomi has long been compared to Apple. It made bets that its rivals rushed to imitate, like selling its low-cost, high-design phones mainly online.

Xiaomi's first electric car was brought out last March: the SU7, a four-door sedan with artificial intelligence features that can help with parking, play movies for passengers and program Xiaomi home appliances from the road. Xiaomi CEO Lei Jun said it looks like a Porsche. But at $30,000, it's a quarter of the price.

Xiaomi makes all kinds of electronics, from robot vacuum cleaners to air conditioners, which are connected through its operating system and controlled in its app. The SU7 is, in some ways, just another gadget. It can use data collected from other devices about a driver's daily routine to determine the best time to charge the car's batteries.

Chinese electric vehicle companies have benefited from billions of dollars in government support, which has helped them gain control of the supply chain down to the very minerals inside the car batteries. This early edge helped two Chinese companies, BYD and Contemporary Amperex Technology Co. -- known as CATL and added to the Pentagon's list of Chinese military companies in January -- become the biggest electric battery makers in the world.

Xiaomi used this supply chain to its advantage.

It is just a matter of time before Xiaomi cars are on the road outside China, said Cui Dongshu, secretary-general of the China Passenger Car Association.