Xiaomi to Launch First Electric Vehicle in Europe by 2027, Aims to Challenge Tesla and BYD Globally

Xiaomi plans to sell its first electric car in Europe by 2027, aiming to compete globally with Tesla and BYD after gaining strength in the Chinese electric vehicle market, which it entered a year ago. The company's president, Lu Weibing, detailed expansion plans after reporting a 31% quarterly revenue increase, driven by the successful launch of its second electric vehicle in the northern hemisphere summer. Xiaomi aims to become one of the world's top five automakers, despite production challenges testing its expansion capacity.

Xiaomi Corp. has outlined plans to enter the European electric vehicle (EV) market by 2027, aiming to challenge established players like Tesla Inc. and BYD Co. globally. The announcement came following a 31% quarterly revenue increase, driven by the successful launch of its second electric vehicle, the YU7 SUV, in the northern hemisphere summer. This growth has been particularly notable given the slowing demand for smartphones, Xiaomi's original and largest business, which saw a 2.1% decline [1].

The company's president, Lu Weibing, provided details on the expansion plans during a post-earnings call, indicating that Xiaomi aims to become one of the world's top five automakers. Despite facing production challenges, such as extended wait times for the YU7 SUV, Xiaomi is optimistic about its prospects in the EV market. The company's revenue climbed to 116 billion yuan ($16.2 billion) in the June quarter, exceeding analyst estimates [1].

Xiaomi's entry into the European market aligns with broader trends in the global EV industry. According to a report by market research firm Rho Motion, global EV sales grew by over 21% year-on-year in July, crossing 10.7 million units sold globally. This growth was driven by strong demand in China, which maintained a 50% EV penetration rate, and significant increases in sales in Europe and North America [2].

The European EV market is particularly attractive to Chinese automakers like BYD, which has seen a 300% growth in sales in the UK. Meanwhile, Tesla Inc. has faced a decline in sales in multiple markets, including a 21% fall in California. Ford Motor Co. and General Motors Co. have also announced new initiatives to compete with Chinese automakers, including unveiling new EV platforms and sourcing batteries from CATL [2].

Xiaomi's robust financial performance and ambitious expansion plans position it as a significant player in the global EV market. The company's focus on improving economies of scale and favorable product mix has helped offset headwinds from the smartphone sector. Despite the challenges, Xiaomi's goal is to increase its market share in China by 1% annually and achieve profitability in the EV segment by the end of 2025 [1].

References:
[1] https://finance.yahoo.com/news/xiaomi-revenue-rises-31-second-094006230.html
[2] https://www.benzinga.com/markets/tech/25/08/47083308/ev-sales-surge-in-europe-china-tesla-slips-while-byd-grows-300-in-uk