Summary of the Core Content
A new domestic consumer giant that earned an annual profit of 3 billion yuan through cleaning appliances such as vacuum cleaners and robotic sweepers has embarked on the car-making journey, driven by the car-making dream that founder Yu Hao has harbored for 15 years. In August 2025, the company made a grand announcement of its entry into the car-making industry, setting ambitious goals such as competing with Bugatti, starting mass production by 2027, assembling a team of 2,000 people, and securing overseas orders worth tens of billions. Within a year, the company managed to build a team of over a thousand people and several stylish prototype cars, holding several international press conferences to boost its profile. However, it never made the necessary “real financial investments” required for mass production: it didn’t sign formal supplier contracts, didn’t finalize agreements with contract manufacturers or decide on whether to build its own factory, and didn’t invest in producing the necessary molds. As a result, in August 2026, the car-making project was quietly halted, with almost all of the 1,000 engineers laid off, leaving behind only a floor full of component samples and the inspiring slogans that remain. This has become a typical example of a “hype-driven failure” in the new wave of car-making startups.
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Detailed Analysis
1. A car-making project that seemingly has everything, but fails to cross the core barriers to mass production
Many people mistakenly believe that building prototype cars is half the battle towards success. In reality, creating prototypes is the easiest part of the process—just assemble them using off-the-shelf components to create a stylish supercar with features like sliding doors and rocket boosters, which is perfect for promotional videos. However, Chui Mi never even reached the basic requirements for mass production:
- The critical issue of mold production: In the automotive industry, investing in molds means that the car design cannot be changed later on, and the millions or even billions invested are lost. By the time Chui Mi’s project was halted, no formal contracts had been signed with suppliers, who had only invested nearly a million in producing the prototypes and were reluctant to invest further.
- The production plan remained unresolved: The company waffled between using domestic manufacturers, building a factory next to Tesla’s Berlin plant, and claiming to have acquired 400,000 square meters of industrial land in Lingang, Shanghai. Two years later, the land was still undeveloped.
- The car design was never finalized: The company changed the design multiple times, considering both supercars and SUVs, yet never settled on a clear direction. It was like trying to open a restaurant with dozens of menu options and a bunch of chefs without deciding on the dishes to serve, nor did it rent a space or purchase cooking equipment, making it impossible to start operations.
2. Chui Mi applied the same “horse-racing” strategy from its home appliance business to car-making, using the same logic as opening a milk tea shop
Chui Mi’s success in the home appliance industry relied on a decentralized approach, with over 200 independent teams each seeking their own resources. If one team created a hit product, it could cover the costs of all failing projects. However, car-making is the opposite: each additional car model, technology route, or team requires additional investment. Even a minor change in the car’s design would render the previously invested molds useless. Chui Mi split its team into several separate units (Star Trek Plan, Star Chen Future, Interstellar Journey) and had separate departments for chassis, batteries, and autonomous driving technology, spreading its already limited R&D resources. As a result, it never managed to develop a car that could be mass-produced.
3. The attempt to “build momentum to attract resources” doesn’t work in today’s car-making industry
Chui Mi’s initial strategy was to use high-profile events, stylish prototypes, and grand claims to attract resources. It hoped that the industry would flock to it, with suppliers investing and local governments providing land and subsidies. However, the new energy car-making market of 2025 is vastly different from the one of a decade ago. Investment firms have shifted to AI and augmented intelligence, and no one is willing to invest in projects that are costly and have long payback periods. Local governments have been deceived by many startups and are now cautious; without substantial capital investment in building factories, they won’t grant land or subsidies. Suppliers are also wary, as many new entrants have defaulted on payments. Chui Mi’s efforts to build momentum yielded no external resources, and its annual profit of 3 billion yuan was no match for the billions required in car-making.
4. The founder’s personal passion overshadowed industry realities, leading to a fiasco
Chui Mi’s car-making efforts were driven by his personal passion. He had wanted to make cars since 2011 and used the profits from his home appliance business to realize his “Tesla-like” dream. He claimed to be one of the few in China who understood car design, alongside Lei Jun and Yu Chengdong. However, he ignored the industry’s realities, implementing absurd practices such as forcing engineers to report daily earnings and forcing them to buy their own appliances to meet performance targets. He didn’t provide funding for software and components, and relied on modifying existing cars for use in tests. Even the employees’ salaries were treated as loans owed to the company. By the time the project collapsed, no real results were achieved, and the entire endeavor turned out to be a costly fiasco.
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This analysis provides a comprehensive breakdown of how Chui Mi’s car-making attempt failed, despite its initial momentum and resources.