For rice noodles, if there is anything more exciting than Xiaomi phones, it must be Xiaomi cars.

On October 23, it was reported that the expansion project (Phase II) of the Xiaomi Automobile Factory will be completed in mid-2025, with the specific completion time being June 15, 2025.The address of the automobile factory is located in Yizhuang New City, Changping District, Beijing, covering an area of approximately 718,000 square meters.

After the completion of the project, the annual production capacity of Xiaomi Automobile's first phase and second phase plants will reach 150,000 units each, and the total annual production capacity will reach 300,000 units, achieving the goal of doubling its regular production capacity.

Xiaomi's confidence in expansion comes from the hot sale of SU7.

Since the launch of Xiaomi SU7 on March 28, sales have continued to be booming. Coupled with Xiaomi and even Lei Jun himself, Xiaomi and even Lei Jun himself have gone on marketing, breaking many sales records in the short term.As of the end of August 2024, Xiaomi Motors has delivered a total of 56,200 vehicles, and has delivered more than 13,000 vehicles for three consecutive months since June.It can be said that Xiaomi Automobile has carved a bloody path in the range of 200,000 to 300,000 where the "inward circulation" is most serious.

Lei Jun set a goal for Xiaomi Automobile to deliver a guaranteed delivery of 100,000 vehicles and hit 120,000 vehicles throughout the year.For SU7, victory is within sight of this goal.There are many people who are willing to pay for Xiaomi Automobile. What really limits Xiaomi's sales is the factory capacity of the automobile factory.

According to the above statement, the annual production capacity of Xiaomi Automobile's first-phase factory is 150,000 vehicles, which is 12,500 vehicles per month, and Xiaomi's monthly delivery volume is far more than this number.Taking October as an example, Xiaomi's delivery volume will exceed 20,000, and the scheduled delivery volume in November and December will reach more than 22,000, which is nearly double the regular production capacity of Xiaomi's automobile factory.

Faced with challenges, Xiaomi Automobile responded twice this year, once to start double shift production in June and once to optimize production lines in July.But no matter how the plan is optimized, Xiaomi will continue to squeeze sponges on the existing infrastructure after all-a production capacity of more than 20,000 is already the limit of the first phase of Xiaomi's automobile factory. In addition, Xiaomi may launch a new car SU8 next year. The implementation of the second phase of the factory is even more urgent.

Of course, Xiaomi's unremitting investment in the automobile sector has yielded outstanding returns.According to Xiaomi's second-quarter 2024 financial report, Xiaomi Automobile's first report card brought Xiaomi 6.4 billion yuan in revenue, accounting for 7.2% of Xiaomi's total revenue.In the second quarter, Xiaomi delivered its best quarterly report in history.

The fly in the ointment is that, like all new car-building forces, Xiaomi SU7 did not get out of the quagmire of losses in the early stages of delivery: in the second quarter, Xiaomi's automobile business had an adjusted net loss of 1.8 billion yuan.At the performance meeting, Xiaomi Group President Lu Weibing said at the performance meeting that the reasons for Xiaomi Automobile's SU7 loss were: first, the scale of Xiaomi Automobile is small; second, the investment cost of pure electric cars itself is relatively high.

However, with the implementation of the second phase of the automobile factory, it is expected that the scale efficiency of Xiaomi Automobile will usher in a wave of improvement.In the second quarter, the gross profit margin of Xiaomi's innovative business, including smart electric vehicles, was 15.4%, which means that the gross profit margin of this part has turned positive.With this foundation, it must be only a matter of time before Xiaomi Automobile turns a profit in the future.