Less than two years after the launch of the SU7, selling electric vehicles is already profitable for Xiaomi

Xiaomi has achieved what many other manufacturers new to the automotive sector can only dream of. After launching its first electric model, the SU7, at the end of March 2024, the automotive division of the Chinese company has managed to close a quarter with a positive operating profit for the first time.

Between July and September of this year, this division recorded an Earnings Before Interest and Taxes of 700 million yuan, which at the current exchange rate amounts to roughly 85 million euros. This result is particularly remarkable given that less than two years have passed since the SU7 went on sale in the Chinese market.

Although it is true that this division is not limited exclusively to the sale of electric cars, the vast majority of its revenue comes from this activity. In the third quarter, revenue from vehicle sales reached 28.3 billion yuan – close to 3.5 billion euros – out of a total of 29 billion for the unit that groups together electric vehicles, artificial intelligence and other projects. This represents a growth of 199 percent compared with the same period of 2024 and 36 percent more than in the previous quarter.

And all of this without leaving the Chinese market for now

The high number of deliveries during the quarter is what made this exceptional result possible for the Chinese company. While in the second quarter it was able to put 81,302 vehicles into the hands of its customers, in the third quarter this figure grew by 33.8 percent, with a total of 108,796 units. The increase is even more notable when compared with the 39,790 vehicles delivered in the same quarter of last year, a growth rate in this case of almost 174 percent.

As if this were not enough, the average selling price rose by 9 percent, to 260,053 yuan – almost 31,700 euros – as a consequence of the growing weight in total sales of the brand’s new YU7 SUV, whose selling price is slightly higher. Additionally, the gross margin reached 25.5 percent, well above the 17.1 percent recorded a year ago, driven by the fall in the cost of key components in the production process and, as a result, the reduction in the unit manufacturing cost.

Following these results, the sale of electric vehicles now accounts for nearly 25 percent of the total revenue of the Xiaomi group, compared with 18 percent in the previous quarter. It should also be noted that the Chinese brand’s sales network has also been strengthened and now has 402 sales points in 119 Chinese cities, with 209 service centres.