Xiaomi said to adopt “dual-factory” model, acquire Borgward plant

Beijing (Gasgoo)- Xiaomi EV may adopt a “dual factory” production model, people familiar with the matter told a local media outlet.

the Xiaomi EV team; photo credit: Xiaomi

On the one hand, Xiaomi hopes to promptly gain production capacity and related certifications by acquisition. Meanwhile, it plans to build its own plant in a second location for stable production capacity. Sources said that the Beijing government is encouraging Xiaomi to acquire Borgward AG for production certification.

Relying on the German Industry 4.0 intelligent manufacturing system, the Borgward plant’s designed capacity is 180,000 vehicles in phase one and 360,000 vehicles in phase two. This intelligent factory covers comprehensive vehicle-making techniques.

Comparing to the rumored acquisition of BAIC BJEV’s plant, taking over the Borgward brand is a far more feasible plan for its automaking layout. Notably, Borgward holds production licenses for both fossil-fueled and new energy vehicles.  

However, the production capacity of the Borgward plant obviously cannot satisfy Xiaomi’s “$10 billion in 10 years” investment plan. Lei Jun might adopt a multi-location layout pattern like other automaking startups such as Xpeng, Li Auto.

The city of Wuhan, for example, has reached out to Xiaomi and pushing Xiaomi EV to settle in the city. According to official records, the Hannan industrial park of Wuhan has accommodated eight automakers and thirteen auto manufacturing plants, including Dongfeng Honda, Dongfeng Peugeot Citroën, Geely Lotus, and Xpeng. The industrial park focuses on territories like lithium-ion battery and fuel-cell battery development while serves as an ICV testing demonstration plot.

Sources disclosed last week, Xiaomi EV will be releasing a new model each year three years after the debut of its first vehicle in 2024 and expects a three-year sales volume of 900,000 vehicles. The company may require one or more large-scale production plants with massive output capacity to meet its goal.