Xiaomi's 2025 Sales Target: Ambition vs. Reality

Xiaomi's Sales Surge: A Reality Check or Just Clever Accounting?

Xiaomi's been making waves, and not just with their phones. Their EV play, the SU7, is supposedly eating into Tesla's market share in China. CEO Lei Jun is talking big, reaffirming a commitment to safety while simultaneously upping the sales target for 2025 from 350,000 to 400,000 units. It all sounds impressive, but let's dig into the numbers.

The Numbers Game: Market Share and Growth

The headline screams success: Xiaomi sold 108,796 cars in Q3, a 173% jump year-over-year and a 33% increase from the previous quarter. Between January and October, they delivered 315,376 cars, nearly hitting their original target. But here's where the skepticism kicks in. While a 173% jump sounds massive, it's crucial to remember the base. What were their sales numbers last year? A huge percentage increase on a small number can be misleading. And while they are nipping at Tesla's heels (more on that later) the actual sales figures are still relatively small compared to established auto makers.

Tesla, meanwhile, has seen its market share in China erode. From a peak of 16% in 2020, it dipped below 7% last year and now sits below 5%. The narrative is clear: Xiaomi, along with other domestic brands, is stealing Tesla's lunch with their "intelligent models" and high-performance batteries. But how much of this is Xiaomi specifically? The article mentions "Chinese brands" collectively, making it difficult to isolate Xiaomi's individual impact.

Xiaomi's pre-order numbers for the YU7 are eye-popping: 200,000 in three minutes, 240,000 in 18 hours. That kind of demand is rare, the article notes. But pre-orders aren't sales. The conversion rate—how many pre-orders actually turn into purchases—is the crucial metric here, and that information is conspicuously absent.

Safety First? Or Sales First?

Lei Jun's emphasis on safety comes after two fatal accidents involving the SU7. One in March, where the driver assistance system failed, and another more recently, where a man died in a burning SU7. Chen Jinzhu, CEO of Shanghai Mingliang Auto Service, is quoted saying that Xiaomi needs to convince consumers about safety, not just rely on "stylish design and hi-tech." Tesla rival Xiaomi reaffirms safety focus after raising 2025 sales target to 400,000 units

This brings up a key question: Can Xiaomi ramp up production by another 50,000 units without compromising safety and quality? It's a classic trade-off, and one that's difficult to navigate. I've seen this pattern repeatedly (parenthetical clarification: faster time to market almost always means more corners cut). The pressure to meet sales targets can lead to compromises in quality control, especially in a rapidly evolving industry like EVs.

The accidents themselves raise serious questions about Xiaomi's autonomous driving tech. The article mentions that the system alerted the driver just two seconds before the crash in the March incident. Two seconds? That's barely enough time to react, let alone take control of a vehicle traveling at high speed. It is a wonder that the authorities are stepping up oversight of these systems.

Beyond Cars: Xiaomi's Broader Ecosystem

It's easy to get caught up in the EV hype, but Xiaomi's success isn't solely dependent on cars. Their refurbished phone business in Europe is booming, thanks to reliable mid-range models like the Redmi Note series. The Redmi Note 13 Pro, for example, is a "safe bet" for resellers, consistently selling for around $200-$220. The demand for these phones is driven by buyers seeking a balance of performance and affordability.

And this is the part of the analysis that I find genuinely puzzling: why can't Xiaomi translate this reputation for reliability into their EV business? The refurbished phone market thrives on trust and consistency. If Xiaomi can deliver that in one sector, why are there so many safety concerns surrounding their cars?

Smoke and Mirrors?

Xiaomi's sales surge is undeniable, but the underlying data requires a closer look. Are they truly revolutionizing the EV market, or are they just masters of marketing and clever accounting? The answer, as always, likely lies somewhere in between.