Apple: The king (Smart Car) is dead, long live the king (GenAI)
On Feb. 27, 2024, Bloomberg reported Apple to wind down electric car effort. But, Apple Car was never only about the Electric Vehicle (EV). The ambition should be Smart Cars powering by AI, as Apple CEO, Tim Cooks once called it “the Mother of all AI projects” in 2017. But now, GenAI has become the new cool kid in the market since ChatGPT rocked the world in 2022. It’s OK, Apple Car. Called it pivoting, stopping a $10B bleeding or whatever, I understand. It just makes a common business sense 🙄.
Xiaomi: The king (Apple Car) is dead, long live the king (Xiaomi Car)
Xiaomi may not win the “Apple killer” title anytime soon. But, Xiaomi SU7 happened to arrive when Apple Car was gone 🤔. Xiaomi started 3 years late on the smartphone revolution. When it was founded in 2010, Apple already shipped 1.7M iPhone 4. Even Xiaomi rised quickly to the №3, shipping 146M smartphones in 2023, Apple was still the №1, shipping 235M smartphones according to IDC Tracker.
From Mar. 28, 2024, anyone can preorder Xiaomi SU7, its 1st EV in China. It was only 3 years ago, Xiaomi broken into the car making business. At $30K, ~4K cheaper than the Model 3 with “the beauty of Porsche”, SU7 is a bargain. This Xiaomi’s “one more thing” looks like another great choice for many. Especially for those can not pay a premium to be “cool like that” 😉 as Porsche Taycan.
Grandmaster’s Last Fight
“He hired too many outsiders too quickly. If the rumors are true, Apple hired more than a thousand outside auto experts and within a couple of years had laid them off. Apple grew this project way too quickly, instead of doing it more organically.” — Robot Cars and the Future of Apple in the book of Tim Cook by Leander Kahney, 2019
Lei Jun, Xiaomi’s founder is already an legend. Before Xiaomi, he founded Kingsoft and sold for $75M to Amazon in 2024. In Feb. 2024, Lei handed over the mobile to Lu Weibing to focus on Xiaomi car. Xiaomi car is his last fight, as Lei called it. His ambition is to become a top 5 smart car maker in 15 to 20 years by matching Porsche & Tesla by the product, not the price. It’s all about building a dream car. Or a smart mobile space as Lei redefined it. A great founder fight to build good products first, and then the business will come. Whereas, most CEOs focus on the business first, and then… After all, it’s just a job 🤷♂.
The fan community
There is no way SU7 making any money for Xiaomi any time soon, as Lei also conceded. The only way Xiaomi can up level China car industry is Scale + Services. When Xiaomi first entered China mobile market, MIUI ROM was free to users. The business value was negative by any accounting. But, Xiaomi fan community returns much more to Xiaomi’s successes since. FYR in China, Xiaomi Fan Festival is a thing. Arguably, Tesla built its fan community & gets more out similarly. Unfortunately, no other car brand gets closer to that so far. They should be really worry because Xiaomi has “become exceedingly efficient at it”, and now building a smart car.
A lot of car makers want to do SW as a Service, but never bother to master the Prime for subscription (2C) or the utility model (2B). It’s not a rocket sciences, but it does take one to reimagine What Smarter Car Business You Are Really In. Anyway when Lei does it again, it’s literally another Apple for Smart Cars. By then, “Xiaomi for X” will be a good inspiration for new ventures to come.
Giving market caps: Microsoft (3.1T) — Apple (2.6T) = Tesla (0.5T). Calculate Xiaomi + SU7 = ?
