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Xiaomi is affected by the US tariff measures against China

The commercial war generates impediments for the objectives of the Chinese brand

Xiaomi continues its development internationally and has become one of the main rivals of Apple and Samsung. In India, Xiaomi maintains its market leadership and simultaneously continues to gain terrain internationally, however, still has a pending goal, the United States.

The Asian continent is the epicenter of the company’s operations, however, Xiaomi is seeking to expand internationally with the aim of being one of the world’s technological leaders. Its sales of 28.5 million units during the first three months of the year demonstrate the power and scope of Xiaomi in the international market.

Currently, Xiaomi is no longer just a promise and its leadership is a reality, as they claim 7.4% of the world market share, entering among the four most powerful technological devices companies in the world, leaving behind compatriot companies like Oppo, and all this without making a presence in the United States.

United States Xiaomi

Now, world-class companies such as Samsung or Apple are concerned that the territorial deployment that Xiaomi has in Europe and Latin America, and the possibility of having the Asian titan in the United States makes it a latent threat.

The formula that has led Xiaomi to success is to offer top quality products at a competitive price, separating from rival brands that sell high-end exclusivity at a higher cost, in this way Xiaomi has had a development of 330% in the Asia and the Pacific region.

The antecedent to the United States is Europe, and the results speak for themselves

United States Xiaomi

In some European countries, Xiaomi is the leader in sales, the first quarter of the year resulted in the sale of more than three million units on the continent, and the magnificent development of 1000% in sales in Europe is due to the diversification of new stores in Spain and Italy, although the true epicenter of Xiaomi in Europe is Greece, where Xiaomi is the number one in popularity.

With only one year in Greece, Xiaomi has already assumed the lead in sales with 24% of total sales of the sector, ahead of Apple and Samsung, this being the sample of the potential of conquest that has the Asian brand, with products to a good price, first-class quality, and more than attractive product distribution.

The United States, a new territory to conquer

United States Xiaomi

“The US will continue its efforts to protect domestic technology and intellectual property, stop non-economic transfers of significant industrial technology and intellectual property to China, and ensure access to the Chinese market,” said Donald Trump, president of the United States.

Now, with the good development in Europe, Xiaomi set course to establish in North America, but the planning was affected by the commercial war that the United States has carried out with China, increasing the international tension and generating instability between the companies with plans that include both nations, this being the case of Xiaomi.

Lei Jun, president of Xiaomi, said that one of the company’s objectives was to commercialize the brand’s products in the United States by the end of 2018 or the beginning of 2019, with the approval of the relevant regulations by the United States authorities.

United States Xiaomi

Other companies with the same objective saw their plans frustrated by the US authorities fear of espionage by Chinese companies, and the regulations have directly affected companies such as ZTE or Huawei, thus setting a precedent for the next companies wishing to join the American market.

The commercial war resulted in excessive increases in tariffs on Chinese products by the United States, an increase of 25% to certain Chinese technological products, a situation that Xiaomi did not have in its plans.

Now Xiaomi faces hostile conditions that could finally close the doors of the US market to the Asian brand, however, Xiaomi still has excellent relations with its North American investors and its connections with American brands such as Qualcomm, which have been affected by the tariff increases of the Chinese government.

The commercial war affects the value of Xiaomi in the stock market

United States Xiaomi

The imposition of tariffs has not meant the best time for the sale of Asian brand values:

“Their IPO may not have arrived at the best time since we are in the midst of a commercial war. The starting price is very far from the figures that were initially considered for the company; This circumstance has to do, no doubt, with the trade war between China and the US, which could affect the sector in which Xiaomi is included” – says Victoria de la Torre, analyst at Self Bank.

The stock valuation of 54,000 million dollars of Xiaomi is set very far from the stock valuation of 100 million dollars announced in the beginning.

Source: Xiaomi4mi

Read more: The 32GB version of the Xiaomi Mi A2 will not arrive in India

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