Shan Lianyu, general manager of Xiaomi’s Home Appliances Department, recently shared on-site photos of Xiaomi’s new smart home appliance factory in Wuhan, revealing that it is nearing completion. The factory will begin by mass-producing Xiaomi’s self-developed air-conditioners and features a high degree of automation, according to the company. In early March, Xiaomi CEO Lei Jun said large-scale production is expected to start at the facility by the end of 2025.
Why it matters: The Wuhan facility is Xiaomi’s first smart home appliance factory. Shifting from its early contract manufacturing model, Xiaomi has invested heavily in building its own factories to enhance product independence, particularly in response to past concerns about the originality of its air-conditioner designs. Its strategy of aiming to deliver high specs at competitive prices challenges established domestic air-conditioner brands such as Gree and Midea.
Details: Xiaomi’s smart home appliance factory, the company’s third factory, completes its full-ecosystem strategy for self-built smart manufacturing following its automobile and smartphone factories.
- Located in Wuhan’s East Lake High-Tech District, the facility broke ground in November 2024. The first phase features six sub-factories and over 100 laboratories, according to Xiaomi.
- During a livestream on March 2, Lei Jun revealed that the Wuhan Xiaomi smart home appliance factory is under rapid construction and is expected to begin large-scale production by the end of the year. China Construction Third Engineering Bureau, a state-owned construction contractor, recently announced the project’s main structure was capped in just 80 days.
- Xiaomi air-conditioners aim to rank third in domestic sales this year and plan to become a leading air-conditioner brand within the next five years, Xiaomi co-founder Lu Weibing said last week on the Chinese social platform Weibo.
Context: In 2024, the top five brands in China’s air-conditioner market were Midea (27.87%), Gree (25.46%), HuaLing (7.30%), Xiaomi (7.01%), and Haier (6.63%), according to estimates from third-party platforms on Baidu.
- Last year, air-conditioner shipments in China reached around 102 million units, reflecting a 5.86% year-on-year growth, the Baidu data suggested. The full year shipment value stood at around RMB 271.5 billion ($37.55 billion).
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