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Xiaomi is successfully diversifying into electric cars. As a reminder, this year, the Chinese brand launched the SU7, its first series of electric cars, in China. And for the moment, the signals are positive for the manufacturer. Xiaomi has just presented its results for the third quarter of 2024 and according to its press release, the market performance of the Xiaomi SU7 Series has significantly exceeded the manufacturer's expectations.
“The Group is continuously accelerating the production and delivery of the Xiaomi SU7 series. In the second quarter, deliveries of the Xiaomi SU7 series reached 27,307 vehicles, with monthly deliveries exceeding 10,000 units for two consecutive months. The increase in production capacity exceeds that of its peers, demonstrating strong competitive strength”, the brand also indicates.
Xiaomi also plans to deliver 100,000 electric vehicles by November, while the goal for the whole of 2024 is to deliver 120,000 vehicles. To accelerate sales, Xiaomi is relying on a network of 87 sales centers, which are spread throughout China.
200% Deposit Bonus up to €3,000 180% First Deposit Bonus up to $20,000Xiaomi is banking on economies of scale
But even if Xiaomi electric cars are off to a good start, this new activity is still quite far from being profitable. According to a Bloomberg article, Xiaomi would still lose the equivalent of several thousand euros per vehicle sold. And for now, the manufacturer is aiming for growth in this new business, but not profits. “We are confident that scale will generate profits in the future,” , explains Alain Lam, the CFO, as quoted by Bloomberg. In its press release, Xiaomi also indicates that it has “ample liquidity resources” that allow its electric vehicle division to “remain focused on developing technologies and products amid intense market competition.”
The group as a whole is doing very well. In the second quarter, revenue increased by 32% year-on-year, reaching the equivalent of more than €11 billion. And adjusted net profit increased by 20.1%. In the second quarter, Xiaomi shipped 42.2 million smartphones, up 28.1% year-on-year. And, based on data from Canalys, it indicates that it has managed to remain in the Top 3 of the smartphone market for 16 consecutive quarters.
- This year, Xiaomi launched its first electric cars and so far, the results of this activity are very satisfactory
- Indeed, the manufacturer indicates that the performance of the SU7 series on the Chinese market has exceeded its expectations
- However, Xiaomi still needs to increase production and sales for this new activity to generate profits
- Overall, the group is doing very well, with revenues and profits increasing
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