In recent years, many cellphone companies successively entered the future world of automotive new technology to find the next blue ocean. However, the path of automotive product development is much longer and much more costly compared with that of cellphones. Cellphone giants such as Apple and Huawei had obviously turned the focus of business into helping carmakers to develop new technologies and new features, instead of entering car manufacturing industry themselves; First, the gross margin of car manufacturing business is not good enough to be compared with cellphone; second, the efforts and investment for selling cars are more complicated than selling cellphones. Instead of stepping onto this “road of no return”, they’d rather focus on the ICT industry that they are familiar with to play the role of helping carmakers so that their business will be more sustainable in the long run. On the other hand, there is a company that had fully devoted to manufacturing cars – Xiaomi… Xiaomi Automobile, which had been established for just over one year, is preparing to take three years to develop new car model then begin mass production in 2024. High-end car models will be equipped with CATL’s Qilin batteries, which can be adapted to 800V charging system; entry car models will be equipped with BYD’s LFP blade batteries that utilizes 400V charging system. In addition, Xiaomi aims at rapidly improving the overall capability of car manufacturing operation in developing key components of new technologies including chips, batteries, LiDARs, etc., In early August, Xiaomi revealed the progress of R&D that utilizes the R&D team of autonomous driving as the core to develop AI algorithm on their own, and they will strive to catch up with the world-leading echelons including Waymo and Baidu, etc., The reason why Xiaomi is so ambitious about automotive market is not only the passion of their leader, but also the high cost-efficiency created from the full-control of supply chain of the cellphone industry. And it’s worthy of notice that whether Xiaomi can copy the experience to the automotive industry in the next two years.
It’s quite challenging to cross the territory from the cellphone industry to the automotive industry; So why does the automotive industry want to produce cellphones?! Geely and Nio, a traditional carmaker and a BEV startup company respectively, both coincidentally announced to produce cellphones. The relevance between cellphones and cars had become closer interaction from the technology aspects including car positioning, remote locking/unlocking, valet mode parking, etc., However, apart from these considerations, there are more strategic meanings in higher level …
- The globalization deployment of Geely Auto Group. Geely Auto Group owns Volvo, Proton, and multiple self-owned brands. Geely can establish multi-brand ecosystem on the cellphone platform to provide customers with more comprehensive services, and to utilize the low-orbit satellites, which is under construction, to expand the derivative services of their cellphones and to improve the interactive functions with cars. On the other hand, in the development of APPs of cellphones, Geely can transfer part of the achievements applicable to cars. Furthermore, by introducing the cellphone brand, Geely can integrate the volume demand of chips as a carmaker for stronger price negotiation power and highly-prioritized order of supply.
- Nio utilizes cellphones to uplift the positioning of its car models. Nio will utilize the positioning of high-end cellphones to comply with car models for the total marketing, and the motivation behind is simpler than that of Geely. However, Nio has massively invested in the battery swapping station strategy, and now they begin making cellphones… the financial situation is worthy of notice.
- Tesla’s cellphone “rhapsody”. In fact, I won’t be surprised at anything Elon Musk does in the future. His cellphone “rhapsody” is to ditch iOS and Android to develop an exclusive operating system, and it can make phone calls via their low-orbit satellites without SIM cards (satellite phone fee must be paid, of course). This cellphone that might be named as Model Pi will integrate the ecosystem of their cars, satellites, cellphones, and the concept is similar to that of Geely, but the product and price positioning of the cellphone will be classified as high-end level, and will even surpass iPhone. The timetable of mass production is said to be 2024.
From these plans of carmakers or cellphone manufacturers, we can see that these two completely unrelated industries will get closer and closer, and there is a mutualism trend ahead. No matter how the result will be, the automotive industry will no longer be the automotive industry nowadays, and the cellphone industry will no longer be limited in today’s scope of applications.