(Bloomberg) — Xiaomi Corp. plans to deliver 120,000 of its SU7 electric vehicles this year, increasing its initial goals for a car it hopes can someday compete with Tesla Inc.
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The company disclosed its latest target in a press release issued after reporting the fastest pace of quarterly revenue growth in more than two years, reflecting an improvement in the smartphone market. Revenue rose 27% faster than expected to 75.51 billion yuan ($10.4 billion) in the March quarter, about 2.7% above the average estimate.
Xiaomi’s lofty goal suggests billionaire co-founder Lei Jun is confident of advancing his $10 billion foray into the crowded electric car market. His company unveiled the SU7 in late March and later said it expected to deliver more than 100,000 vehicles. By the end of April, orders for the SU7 series approached 90,000, with 10,000 delivered by mid-May.
“The group has set a target of delivering 120,000 Xiaomi SU7 series vehicles this year and planned to start double-shift production in June,” Xiaomi said in its statement.
Xiaomi, which earns more than 60% of its revenue from smartphones, has been trying to diversify, in part due to weak demand for devices in its home market. On Thursday, it reported a 1% drop in net profit to 4.2 billion yuan for the March quarter.
Still, signs point to a gradual recovery in mobility in China and other countries. Xiaomi’s smartphone unit shipments grew nearly 34% last quarter amid a broader market recovery, closing the gap with market leaders Samsung Electronics Co. and Apple Inc., according to market tracker IDC . Apple’s global iPhone shipments fell more than expected as sales slowed in China.
The company is also developing a sport utility vehicle similar to Tesla’s Model Y, with the aim of launching sales as early as 2025, according to people familiar with the matter. The EV business could represent a mid- to high-single-digit percentage of the company’s revenue in 2024, Bloomberg Intelligence analysts Steven Tseng and Sean Chen said.
Read more: Apple faces worst iPhone crash since Covid as rivals rise
–With assistance from Ville Heiskanen.
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