On April 23rd, Xiaomi held an investor conference for its automotive sector. Lei Jun shared the latest developments on the Xiaomi SU7 and the company's plans for its automotive division.
Regarding the gross profit margin of the Xiaomi SU7, Lei Jun stated, "I am truly grateful to our suppliers. From day one, they believed in Xiaomi's automotive venture, providing us with excellent costs and support. I estimate the gross profit margin to be around 5-10%."
Many have dismantled Xiaomi's cars, so it's no exaggeration. The majority of our suppliers are from BBA (Mercedes-Benz, BMW, Audi).
Using such expensive suppliers and components, the gross profit margin won't be very high. So, he particularly appreciates the suppliers for offering very good costs and support.
As for the deployment of Xiaomi's automotive business, Lei Jun mentioned that within the next three years, they will focus entirely on the domestic market. Excelling in the Chinese market is their first step.
Moreover, since half of Xiaomi's revenue comes from the global market and Xiaomi does business in over 100 countries, with a global influence and a strong fan base, when Xiaomi is ready, entering the global market for Xiaomi cars should be straightforward.
The goal of Xiaomi's automotive venture is not just marginal profitability but to become one of the top five automakers globally within 15-20 years, becoming the new generation's global leader in hardcore technology.
Additionally, Lei Jun revealed the latest progress of the Xiaomi SU7. As of April 20th, pre-orders for the Xiaomi SU7 have exceeded 70,000 units, and Xiaomi Motors is vigorously expanding its production capacity, with a delivery target of 100,000 units this year.
