Xiaomi EV Distribution Will Use A Combination of Direct Sales and Agency Models

Xiaomi‘s automobile channel will adopt a similar direct sales + agency model as XPeng Motors.

On January 2nd, Xiaomi EV officially announced the launch of its city recruitment program. It will open recruitment for Xiaomi EV sales and service stores (2S) in 17 cities including Suzhou, Chongqing, Ningbo, and Nanjing. The target recruits are top 100 automobile dealer groups or regional strong business partners.

From now on, Xiaomi EV’s channel model has been officially determined as the “1+N” model. In this model, “1” represents Xiaomi EV’s self-built and self-operated delivery center, which mainly focuses on delivery and covers sales and after-sales services; “N” represents agent sales and user service touchpoints.

In the mainstream automotive business circle, Xiaomi collaborates with top 100 automobile dealerships or regional strong merchants to establish integrated car sales and service stores, operating through “agency sales + authorized services”. In core commercial plazas (Malls), Xiaomi leverages its existing advantages in 3C retail channels and gradually introduces automotive businesses into Xiaomi Home.

This means that Xiaomi‘s automobile channel will adopt a similar direct sales + agency model as XPeng Motors. The advantage of this model is that Xiaomi can quickly expand its channels and create more consumer touchpoints. However, the disadvantage is that if the two systems lack proper planning, it may lead to internal conflicts. Nevertheless, William Lu, partner and president of Xiaomi Group, stated that direct sales remain at the core of Xiaomi‘s new retail strategy for automobiles.

Multiple Xiaomi Home stores in various locations have already begun renovation work, and it is expected that display vehicles will officially arrive at the stores in the first quarter of next year. In one commercial district in Shanghai, a Xiaomi Home store was relocated to a larger space within the same district as early as December last year. Previously, this was XPeng Motors’ dealership.

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In terms of distribution and agency, Xiaomi EV officially unveiled its first new car, the Xiaomi SU7, on December 28, 2023. After that, it has been accelerating the construction of sales and service channels. On the second day after the debut of Xiaomi SU7 (December 29, 2023), Xiaomi Group signed a cooperation intention agreement with the first batch of 14 sales and service partners at its headquarters in Beijing.

The automobile dealer that has already signed a contract with Xiaomi EV is quite influential. Among them, Sichuan Ganghong Group, as the first Fortune Global 500 joint venture in the automotive distribution field, has successively obtained regional agency rights for nine major automobile brands including Shanghai General Motors Buick, Guangzhou Automobile Honda, Nissan, Lexus, and BYD. In terms of new energy vehicles, they have also taken the lead in creating the “Intelligent Electric World · Azure Center”. In addition, E•KINGO is also one of the top ten automobile service providers nationwide and represents more than thirty automobile brands.

Xiaomi EV, when recruiting dealers, requires that the other party be a top 100 national automotive dealer group or a strong business within the region, with core commercial district resources and good customer resources. Priority is given to recruiting dealers with experience in luxury brands or mainstream new energy brand agency.

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