Xiaomi eyes global EV leadership

Xiaomi Corp. is focusing on expanding its electric vehicle (EV) division, even at the expense of short-term profits, as it aims to join the ranks of Tesla Inc. and BYD Co. among the world’s leading automakers within the next decade or two, Chief Financial Officer Alain Lam told Bloomberg.

Lam emphasised the company’s commitment to growth over margins, noting that the five-month-old EV business will take time to become profitable.

Xiaomi’s shares surged by 8.5 per cent following the announcement of its fastest quarterly revenue growth since 2021, driven by the initial success of its EVs. The company reported a 32 per cent increase in sales to 88.9 billion yuan ($16.3 billion) in the June quarter, with the EV division contributing significantly.

Founder Lei Jun has pledged to invest $10 billion in carmaking, aiming to replicate Xiaomi’s success in the smartphone market. Despite recording an adjusted net loss of 1.8 billion yuan ($252 million) in the second quarter, Xiaomi remains optimistic about the future, targeting the delivery of 120,000 EVs by 2024.

Xiaomi is developing additional models to compete with industry leaders and plans to launch a sport utility vehicle similar to Tesla’s Model Y by 2025. The company is also expanding its production capacity, recently acquiring a site in Beijing.