The beginning of 2021 turned out to be not so rosy for the Xiaomi brand. The Americans suspected the Chinese company of ties to the military. US sanctions against Xiaomi completely mirror the story with the Huawei brand. Someone said, thought somewhere, no evidence at all, but it’s better to ban just in case.
US sanctions against Xiaomi
According to the American side, the restrictions on Xiaomi are significantly different from the sanctions on Huawei. The Chinese brand is allowed to cooperate with American companies. However, US investors are prohibited from investing funds in Xiaomi’s manufacturing facilities. Additionally, Americans are required to divest from Xiaomi shares by November 11, 2021.
On paper, it all sounds great, but we see the same snowball effect that Chinese communication manufacturer Huawei experienced. After all, there is still no evidence that the Chinese have engaged in intelligence activities against the US and Europe.
What Xiaomi can expect from US sanctions
It is already better to reorient all production to the domestic market. Huawei failed to do this in time. Having the experience of others, Xiaomi will find it easier to do everything. Undoubtedly, US sanctions against Xiaomi will lead the manufacturer to lose the American market. This is a very serious financial blow. But it’s not as bad as it seems. For example, Huawei, during difficult times, found other, more interesting markets. And the price reduction on devices contributed to increased demand.
And Xiaomi has a great chance to change the “battlefield.” A technologically advanced brand, affordable pricing, recognizability. Xiaomi has an excellent foundation for a new start. You don’t have to be a genius to understand that the US is deliberately undermining China’s IT industry. Only short-sighted leadership in Washington fails to see that the Chinese are true patriots. Chinese residents will refuse American cars, clothing, shoes, food, appliances, and electronics. And it’s already unclear whose economy will collapse first. It’s a pity that such cool brands as Google, Apple, Tesla… will suffer because of politicians.
