Following his sixth annual personal address on the evening of September 25th, Lei Jun, Founder of Xiaomi Group, sat down with National Business Daily (NBD) and other media outlets. Lei Jun discussed the company's comprehensive shift toward a premiumization strategy across its product lines—from cars and smartphones to electronic devices like routers—a direction set after learning from past missteps.

In the automotive sector, Lei Jun expressed gratitude to all pioneers in the new energy vehicle industry, noting that domestic automakers are collectively advancing and that the industry should avoid "nasty" competition. 

Regarding smartphones, Lei Jun described the competitive landscape as far more complex and difficult than the automotive market, necessitating a "long war" strategy. After years of exploration, Xiaomi has developed its "methodology" for premiumization: technology leadership, cognitive leadership, and aesthetic leadership. Yet, a new challenge has emerged: customization services. 

Excerpts from the Interview:

On Xiaomi Smartphones: A Name Change to Reintroduce the Brand

Q: The change of the product name from Xiaomi 16 to Xiaomi 17 has generated a lot of discussion. You also mentioned 'comprehensive benchmarking against the iPhone.' How should we understand the relationship between this statement and the name change? Also, many Chinese manufacturers are transforming from internet companies into hard-core technology companies. How do you view this continuous innovation and breakthrough? When can we move from running side-by-side to taking the lead?

Lei Jun: The public reaction to changing the name of the Xiaomi 16 to the Xiaomi 17 surprised me. The main reason for the change is that Xiaomi has been making phones for 15 years, but many people still hold outdated stereotypes. Therefore, I felt it was necessary to let everyone re-examine Xiaomi smartphones. In fact, this generation of the Xiaomi 17 has achieved a cross-generational upgrade in product capability—it's phenomenal.

Five years ago, we proposed benchmarking against Apple, which I believe required courage. Only by daring to benchmark against the world's number one can we achieve the progression from approaching to running side-by-side, and then to taking the lead. Five years ago, we firmly proposed the benchmark; today, we say "comprehensive benchmarking" because the Xiaomi 17 has surpassed the entire iPhone 17 series in many aspects.

We have made significant breakthroughs in battery technology, screen technology, and thermal management. For instance, Xiaomi started using VC vapor chambers five years ago, and today we're applying even more advanced technology. We have many innovations in sensors, periscope lenses, and other areas.

This is the confidence and courage that allows us to change the name to Xiaomi 17 and confront the competition head-on. Through this name change, we hope the outside world will re-acknowledge Xiaomi smartphones and, at the same time, reaffirm our determination to challenge the world's number one.

Q: Xiaomi 17's innovation model, which focuses on material breakthroughs, involves a longer investment cycle and greater difficulty compared to traditional hardware parameter stacking. Does this mean Xiaomi is entering a new phase of supply chain self-sufficiency? Will this model of 'deep self-development + domestic collaboration' be replicated in other key areas, such as image sensors and core battery materials?

Lei Jun: Five years ago, we set out to transform into a smart manufacturing, hard-core technology company. The core of a hard-core technology company is capability-driven; it's not about gambling on opportunities, but about the three, five, or ten years of investment and continuous R&D required to truly accomplish things. That's why five years ago, we set a direct goal of five years. For chip development, we simply set a 10-year target.

Xiaomi's time horizon is getting longer and longer, which is why the outside world often feels that Xiaomi's achievements appear "suddenly." They are not sudden; it's because we've been operating in secrecy, and the products we launch have been in internal development for five or ten years.

In recent years, my confidence in China's industrial sector has grown. In the early days, we focused on application-layer innovation—application and scenario innovation—which is the strength of Chinese companies. In recent years, we've gradually moved to component-level and chip-level innovation. Today, I see more and more innovation happening at the material level, in materials and core components.

Battery technology is a classic example. Originally, companies like CATL achieved breakthroughs in power batteries, and because the investment in power batteries is so significant, the progress has been rapid. Now, conversely, the entire consumer-grade battery technology for phones is also developing by leaps and bounds.

Q: What are your expectations for the Xiaomi smartphone series? In the long run, what will the competitive landscape look like between Xiaomi (or domestic smartphone manufacturers) and the iPhone?

Lei Jun: I think Apple is a fantastic company that every company needs to study diligently. The iPhone 17 series has sold extremely well this time—online reviews say they "squeezed the toothpaste out"—meaning they took a big step forward relative to past iPhones. Honestly speaking, the Xiaomi 17 leads in many technology areas, which is why we are confident in a comprehensive benchmark. Of course, I believe the sales of this round of Xiaomi 17 will also exceed our expectations.

However, our competition with Apple will likely be a long and painful process. We must wholeheartedly learn from Apple and improve every detail, step-by-step. Apple is seamless across 360 degrees, having put tremendous effort into every field. We might start by finding 10 points of breakthrough, then 20, and then gradually cover more angles.

Therefore, we are comprehensively benchmarking across multiple dimensions, not just the main specifications and parameters as before. Now, it's more about technology leadership and benchmarking, even surpassing, Apple in more aspects of user experience.

Q: Can we find a new sales growth breakthrough for smartphones in the next 3 to 5 years?

Lei Jun: Globally, the smartphone market is intensely competitive. Its difficulty surpasses that of the automotive industry. Global competitors are Apple, Samsung, and Huawei—all are technology giants on this planet, making the competitive difficulty exceptionally high.

The Chinese market is the most absurd market I've ever seen. Six main players each hold an average of 15% to 16% of the market share, with the lead changing every two or three months. You might be number one today, but two or three months later, you could be sixth. Our five competitors are all remarkable companies. Honestly, I deeply admire the capabilities of these companies. Under the pressure of such powerful peers, we long ago abandoned the possibility of a quick victory.

Two years ago, the goal I set for them was to maintain a 1% market share growth every year. No need to rush; take it slowly. I think Xiaomi's greatest strength is that time is Xiaomi's friend; Xiaomi is a long-distance runner, and the longer the time, the stronger we become.

In the entire smartphone market, especially the Chinese market, we are fighting a long war. I believe this is precisely Xiaomi's strong suit. We must indeed learn from all our peers and be the "six-sided warrior," looking at every dimension to see the difference between us and the competition. There's no other way; the complexity and difficulty of competition in the smartphone market far exceed those in the automotive sector.

Lei Jun File photo/NBD

On Xiaomi EV: The Next Step is "Experience Equality" in the Premium Era

Q: You mentioned that Chinese auto companies are fully rising in the high-end automotive market. What role has Xiaomi played in this trend, and what is its influence or driving effect?

Lei Jun: Xiaomi learned from traditional luxury cars in areas like chassis technology and handling performance, competing with Porsche. For the past 100 years, almost all high-end cars have been refined on the Nürburgring track. Xiaomi is the first company to treat the Nürburgring as its home court, seriously focusing on improving car handling and chassis—these are the fundamentals of car manufacturing.

Some might question why a car needs to drive so fast. Only by reaching the speed limit can you truly perfect the car. This isn't my invention; it's been the global automotive industry's standard practice for 100 years, but Chinese car companies have only started doing this now.

I believe that driven by Xiaomi, more and more cars will place greater emphasis on handling, chassis, and the mechanical quality of the car. This is a significant change that Xiaomi's entry has brought to the entire automotive market.

Furthermore, we are also promoting the interconnection and open collaboration of the "People, Car, and Home" full ecosystem, which is another new element Xiaomi is injecting into the industry. For example, we highly value design; the car paint is a typical example. Xiaomi's car paints look great, and we plan to develop 100 more types of car paint within the next three years.

Q: Following years of technological and product development, including the SU7 and Xiaomi smartphones, Xiaomi's positioning in the minds of young people seems to have shifted to 'fashionable tech trendsetter.' What is your view on this positioning, and what efforts has Xiaomi made to achieve it?

Lei Jun: Fifteen years ago, Xiaomi's original positioning was for online "enthusiasts." No one expected Xiaomi's growth rate to exceed our own imagination, turning it into a mass brand.

But honestly, we weren't fully prepared back then. The pain we encountered five or six years ago was that we grew too fast, many people didn't understand us, there were many biases, and because of the rapid growth, there were many things we ourselves didn't do well.

So, after six months of reflection, we made some major decisions, one of which was to push for premiumization to gain recognition from more high-end users and women. Online geek enthusiasts were predominantly male, so at that time, Xiaomi was a male-leaning brand. But today, nearly half of Xiaomi EV users are female. The user structure has undergone a fundamental change, which is precisely the result of the premiumization push from five years ago.

In these five years of exploration, we have gradually formed our methodology for premiumization, the "Three Great Leadership": technology leadership, cognitive leadership, and aesthetic leadership. Only by improving ourselves in these three dimensions can we gradually achieve premiumization.

To this end, we hold quarterly discussions to review our achievements, difficulties, and the "potholes" we've encountered during the premiumization process.

The customization service we launched today is a "superpower"—I'm speaking the truth because most people opposed it, saying it was thankless work that would lead to backlash if done poorly. I said if we don't explore it, we can hardly do it well. Customization looks dazzling, but every single item must be done well, and the workload is massive. In the past, only multi-million-dollar luxury cars offered this service. Today, we believe that in this society, people's demand for personalization and aesthetics is increasing. In this premium era, the next step is experience equality—making the ultra-luxury experiences of the past available to mass-market customers. This is the direction we are working towards.

Q: After the launch of Xiaomi EV, the market and user feedback were very enthusiastic. We also observed some malicious, false information appearing online to discredit Xiaomi, as well as some unfriendly comments aimed at Xiaomi car owners. How do you view this issue?

Lei Jun: After the launch of Xiaomi EV, it definitely became one of the most heavily "slandered" brands on the entire internet. We wholeheartedly support the joint action by the regulators to crack down on black-hat marketing and malicious PR. We believe that the entire automotive industry needs a clean and upright environment to achieve sustainable development. On this point, Xiaomi EV is a victim, and we call on the whole society to combat this malicious PR and black-hat marketing, as they are truly causing many difficulties for our industry's development.

Q: What do you and Li Xiang (CEO of Li Auto) discuss in your exchanges?

Lei Jun: First of all, Xiaomi EV is a latecomer, and we are sincerely grateful to all the pioneers in the new energy vehicle industry. As a latecomer, Xiaomi has enjoyed many of the benefits of this era.

So, from day one, we felt Xiaomi has a responsibility to help the entire industry progress, because we are beneficiaries and must contribute back to the industry. Since joining the auto industry, we have consistently emphasized cooperation and mutual progress. Over the past year and a half, you should have seen that we have effectively promoted collaboration within the industry.

I believe domestic cars are all making progress today, and there's really no need to engage in "ugly" competition. I think we need mutual cooperation. The market is huge and far from the stage where we need to aggressively compete amongst ourselves. Having gone through the brutal competition of the mobile phone industry, the auto industry, by comparison, seems to be in a stage of collective growth.

Based on this, I feel that this new industry still needs joint cooperation to drive the progress of the entire domestic automotive industry. Therefore, we are also promoting the opening of IoT standards and protocols. This includes our recent announcement that the Xiaomi phone's fast-charging protocol will be completely free, allowing more cars to better support Xiaomi phones. Many car manufacturers are forming alliances and collaborating with us. We will announce more when the collaborations reach a certain stage.

Regarding our relationship with "NIO, XPENG, and Li Auto," we are fortunate that Xiaomi was an early investor in NIO and XPENG. While we didn't invest in Li Auto early on, they are a Beijing-based company like us, and we have a lot of cooperation. And honestly, I also greatly admire the tremendous contribution Li Auto has made to the entire new energy vehicle sector. People underestimate the value of their product definition. I believe Li Auto pioneered the path of large-space Extended-Range SUVs, and many car manufacturers are following in their footsteps. So, I take this opportunity to once again express my highest respect to Li Xiang himself.