Chinese smartphone maker Xiaomi denies job cuts as it pushes ahead with EVs, high-end phones

Chinese tech firm Xiaomi, which has an ambitious plan to become the world’s No 1 smartphone brand within three years, has denied reports it is trimming 10 per cent of its payroll amid ongoing investments in electric vehicles (EVs) and high-end phones.

Xiaomi, which employs more than 31,000 people, has “never conducted any lay-offs” since its incorporation in Beijing in 2010, a company spokesperson said on Wednesday, adding that it has about 4,000 job openings.

Reports have circulated on social media that the company, now the world’s No 3 smartphone brand, was trying to persuade about 10 per cent of staff, particularly new hires, to quit.

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In March last year, Xiaomi announced it would invest in the EV industry in China, and it started building its first EV factory on the outskirts of Beijing in November, according to a local government announcement.

However, the shift is putting pressure on Xiaomi’s smartphone business, which faces fierce competition from local and foreign brands, because its EV investment is a long way from delivering revenues and profits.

A Xiaomi store in Beijing, China, Sept. 08, 2021. Photo: SCMP/Simon Song

The company’s Hong Kong-listed stock is trading at valuations similar to its initial public offering price three years ago.

Separately, Li Weixing, vice president and general secretary of Xiaomi’s technical committee – who was one of the 14 founding members of the company – has resigned, Chinese news portal Sina reported on Wednesday. Li was a key figure in developing Xiaomi’s operating system for smartphones and tablets.

Li was also one of the earliest employees to invest in Xiaomi’s rank-and-file venture financing round in 2010, according to an article published on the company’s website.

This article originally appeared in the South China Morning Post (SCMP), the most authoritative voice reporting on China and Asia for more than a century. For more SCMP stories, please explore the SCMP app or visit the SCMP’s Facebook and Twitter pages. Copyright © 2022 South China Morning Post Publishers Ltd. All rights reserved.

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