Xiaomi Corp of China announced on Monday its intention to deliver 130,000 electric vehicles this year, marking the third upward revision of its forecast following a 30.5% increase in revenue for the third quarter.
CEO Lei Jun shared on social media that the company is raising its delivery target from the previous goal of 120,000 units of its inaugural electric vehicle, the SU7 sedan, due to rising demand. This new target significantly exceeds the initial aim of 76,000 set at the vehicle's launch earlier this year.
The SU7, which features design elements inspired by Porsche, was introduced in March, entering a competitive Chinese electric vehicle market with an attractive starting price of under $30,000, which is $4,000 less than Tesla's Model 3 in China.
In China, sales of electric and plug-in hybrid vehicles have surged, now representing over half of total automotive sales in the world's largest car market. In October, these sales rose by 56.7% compared to the previous year, marking the fourth consecutive month that battery-powered vehicles, including plug-ins, have outsold gasoline cars.
To meet the growing demand, Xiaomi has increased its production shifts since June and has introduced the premium SU7 Ultra model, which is priced above $110,000.
During a post-earnings call, Xiaomi's President Lu Weibing stated that the factory currently has the capacity to produce 20,000 vehicles per month, with potential for further expansion.
"Our investment remains significant, and we are continuously enhancing our hardware and software. Ultimately, the specific delivery numbers are less important; we are committed to substantial investment and are actively engaged in research and development for new models," he noted.
He also mentioned that one of the key areas of focus for Xiaomi is the development of autonomous driving technology.
AUTO BUSINESS CONTINUES TO INCUR LOSSES
For the quarter ending September 30, revenue reached 92.5 billion yuan ($12.77 billion), surpassing the LSEG consensus estimate of 91.1 billion yuan from 15 analysts.
Huatai Securities projects that Xiaomi will deliver 400,000 electric vehicles (EVs) by 2025, with electric cars expected to represent approximately 20% of revenue, compared to 8% this year.
However, Xiaomi's automotive division remains unprofitable, reporting an adjusted loss of 1.5 billion yuan for the quarter, alongside a gross profit margin of 17.1%.
In the same quarter, Xiaomi retained its status as the third-largest smartphone manufacturer globally, shipping 42.8 million units, a 3% increase, and capturing 14% of the market, according to Canalys.
Lu indicated that the company aims to expand its offline retail presence in mainland China from 13,000 to 15,000 stores by year-end, with a target of 20,000 by next year, while also making significant investments in technology to enhance its market share.
Xiaomi's adjusted net profit rose by 4.4% to 6.25 billion yuan, exceeding the consensus estimate of 5.92 billion yuan.