Xiaomi targets 350k sales with new electric car factory
Xiaomi is expanding its automotive operations. Following the success of the SU7 sedan, the company is building a second electric car factory in Beijing and has raised its 2025 sales target to 350,000 vehicles. The company's profits increased by 90%, and shares reached record levels, according to Bloomberg.
Once known primarily for smartphone production, Xiaomi is broadening its scope to include a significant automotive presence. The company has started construction on its second electric vehicle factory in Beijing on a 131-acre site, which cost 842 million yuan ($5,6 million).
Production at the new plant is expected to start by mid-year. According to a source familiar with the situation, Xiaomi also plans to expand by acquiring another plot of approximately 129 acres.
The decision to expand results from the success of the SU7 model, which, along with the Ultra version, sold over 200,000 units in less than a year. Xiaomi's CEO, Lei Jun, has raised this year's sales target to 350,000 cars. This summer, the company will release the YU7 sports SUV to compete with companies like Tesla.
Xiaomi's first factory has an annual production capacity of 150,000 vehicles, but the team is working on increasing its efficiency. The operations related to electromobility contributed to a 90% increase in company profits in the last quarter of 2024, marking the highest revenue growth rate since 2021.
Xiaomi's shares have quadrupled in a year, surpassing in valuation giants such as Alibaba and Tencent.
In October, the European Commission imposed additional tariffs on electric cars imported from China. This action results from an investigation that revealed Beijing subsidizes their production, giving Chinese electric vehicles a price advantage in the European automotive market.
