Xiaomi's EV Surge Disrupts China's Electric Car Market

Xiaomi has rapidly emerged as a serious contender in China’s electric vehicle (EV) market, following the success of its debut model, the SU7 sedan, which sold over 258,000 units since its March 2024 launch.

 In Q1 2025 alone, the company delivered 75,869 vehicles, sustaining momentum with seven straight months of over 20,000 deliveries—despite facing production bottlenecks that have pushed delivery times to around 40 weeks. By leveraging its smartphone-based business model, Xiaomi is disrupting the automotive landscape, utilizing its existing distribution networks and aggressive tech-integrated pricing strategy.

Key Highlights

• Xiaomi SU7 records 258,000+ sales since March 2024 launch.
• EV division posts $2.5B Q1 revenue, narrowing losses.
• SU7 offers 835km range, surpasses Tesla Model Y specs.

The EV division generated $2.5 billion in revenue in Q1 2025, with gross margins improving to 23.2 percent, although it still reported a ¥500 million ($69.4 million) loss for the quarter. CEO Lei Jun projects profitability by Q3 or Q4 2025.

Also Read: Xiaomi to Officially Launch its First Electric SUV, YU7 on June 26

China’s EV market, where 50 percent of all cars sold in 2024 were electric, contrasts sharply with the 10 percent EV penetration in the U.S. The SU7’s 835km range outperforms the Tesla Model Y, showcasing China’s push toward innovation in specs and affordability. However, Xiaomi’s 4 percent price discount compared to Tesla highlights the cutthroat pricing environment squeezing margins across the industry.

As Chinese EV manufacturers expand globally—like BYD’s 112 percent export surge—Xiaomi’s rise signals a broader transformation in the global auto industry, driven by tech-first players.