Xiaomi Lei Jun: No "Involvement" in Low-Priced Cars, Preparing to Go Global by 2027
This Lei Jun symposium mainly supplements further information on the recently released YU7. The key points that Dolphin Research believes are worth noting are as follows:
Information Point 1: Approximately 15% of YU7 orders are transferred from the SU7 series.
Considering the company's announcement of locking 240,000 units of YU7 within 18 hours (irrevocable), the 15% proportion corresponds to approximately 36,000 units, having little impact on the overall SU7 orders. The delivery period for SU7 standard version orders has only been shortened by 3-4 weeks, still requiring nearly 9 months of delivery cycle.
With the full monthly capacity of the Phase 1 factory at around 28,000 units, it is estimated that SU7 currently has approximately 250,000 units of orders in hand. Combined with the YU7's locked orders, Xiaomi Auto's total orders in hand have exceeded 500,000 units. Even with the smooth ramp-up of the Phase 2 factory, the current orders in hand will still need to be fully delivered by May-June next year;
Information Point 2: There are no plans to produce Redmi cars.
The market had speculated that the company might launch a low-priced model, but from Lei Jun's response, the low-priced model (using Redmi as a reference) is not currently in the company's plans.
From the development history of Xiaomi phones and Apple phones, the low-priced market is characterized by "low profit margins + high competitiveness," which is not a relatively easy market to make money in. From Xiaomi Auto's planning, the company will still mainly focus on the mid-to-high-end market in the 200,000-350,000 RMB range.
Information Point 3: Prioritize domestic delivery, prepare to go overseas in 2027.
Xiaomi's current total orders in hand will exceed 500,000 units, and these orders will also need to be completed by May-June next year. Considering the company's new car release rhythm and market response, the current planning for Phase 1 and Phase 2 will still be difficult to meet market demand. Recently, the company purchased another piece of land near the Yizhuang factory, which is expected to become the site for the company's Phase 3 factory.
After the ramp-up of capacity at the Phase 1/2/3 factories is completed,$XIAOMI-W(01810.HK) the monthly full capacity of the car is expected to reach over 80,000 units, equivalent to an annual capacity of nearly 1 million units.
Since Lei Jun mentioned "prioritize domestic delivery, prepare to go overseas in 2027," this reveals the company's expectation that the domestic "supply-demand gap" will be basically filled by 2027. Combined with Xiaomi Auto's capacity planning, it roughly corresponds to an annual output of 1 million units.
This aligns with Dolphin Research's previous article "Xiaomi Auto: YU7 Explosive Start, Will It Kick Tesla Off the "Throne"?" expectations, "If Xiaomi maintains the 200,000-350,000 RMB price range, the shipment volume in 2027 is expected to reach 1 million units (referencing the annual sales of 700,000-800,000 units for each BBA brand in China in 2020, and Tesla's annual sales of 660,000 units in China in 2024)."
Based on the core information points (1-3) from Lei Jun's exchange, Dolphin Research maintains its expectations for Xiaomi Auto unchanged, with Xiaomi Auto's sales reaching 1 million units in 2027. With an average price per vehicle of 255,000 RMB and a gross margin increase to 25.7%, Xiaomi Auto's core operating profit after tax in 2027 is 22.1 billion RMB, a year-on-year increase of 43% (core operating expense rate of 15.7%, tax rate of 15%).
As Xiaomi Auto's profits increase, the valuation shifts from PS to PE. Due to the "supply shortage" impact in 2026, the PE calculation mainly references the situation in 2027 (from Information Point 3, the company's potential expectation is that the domestic supply shortage will be alleviated in 2027). Giving Xiaomi Auto a PE of 25-30 times the core operating profit after tax in 2027, discounted to the present, corresponds to a valuation of around 500 billion HKD (referencing a discount rate of 10.16%, temporarily not considering Xiaomi Auto's performance in overseas markets).
Xiaomi's traditional business part maintains the previous expectations, corresponding to approximately 127 billion HKD (based on WACC of 10.16% and a perpetual growth rate of 3%). Combining Xiaomi Auto and traditional business, the company's overall valuation is approximately 1.78 trillion HKD, corresponding to about 69 HKD per share. The current performance of Xiaomi Auto is mainly affected by the capacity ramp-up, while the stock price elasticity still comes from Xiaomi Auto's order performance. Even with a smooth capacity ramp-up, as long as Xiaomi Auto's delivery remains in a long cycle (currently around 10 months), Xiaomi Auto's logic will be difficult to falsify and will continue to bring confidence to the market.
The specific content of this Lei Jun symposium is as follows:
1. Summary of Xiaomi Live Content
1. Xiaomi AI Glasses
(1) Design Features: Specifically designed for Asian facial shapes, does not pinch ears or head, the frame can be opened, worn loosely, weighing about 40 grams, suitable for all-day wear. Available in electronic color-changing and non-electronic color-changing versions, the non-electronic color-changing version can be fitted with prescription lenses. Both online and offline partners can pre-order prescription lenses.
(2) Functional Uses: Equipped with various practical functions, such as serving as open-ear headphones, suitable for conference calls, listening to music, etc., without sound leakage; can act as a first-person camera for taking photos and live streaming, can connect to a power bank during live streaming to solve battery life issues, some live streaming software also comes with beauty features; can also connect to the super Xiao Ai, achieving the function of pointing and asking.
2. Xiaomi Auto
(1) Order Situation: After the June 26th launch event, Xiaomi Auto's order performance was impressive, with 200,000 orders in three minutes, 289,000 orders in one hour, and 240,000 orders locked (irrevocable) within 18 hours. From the reservation user data, the average age is around 33 years old, with female orders accounting for 30%, 5% higher than the SU7's initial sales period. Females prefer Glazed Pink and Danxia Purple, while males prefer Cambrian Gray and Deep Sea Blue. Apple users account for 52.4%, 4.4% higher than the same period. The top three purchasing cities are Shanghai, Hangzhou, and Beijing.
(2) Capacity and Delivery: Due to the overwhelming orders, capacity is under pressure, and efforts are being made to increase it. At the beginning of the year, the plan was to deliver at least 300,000 units, later expanding the target to 350,000 units. Xiaomi Home construction progress is fast, currently covering 92 cities, with a total of 335 stores, and 18 more will be added in July. Upon delivery, a gift box containing a baseball cap, window breaker, sunglasses, glasses case, USB drive, etc., will be given as a delivery gift.
(3) Range Performance: All models come standard with ultra-long range, with the standard version CLTC range reaching 835 kilometers, leading among medium-to-large pure electric SUVs; the Pro and Max versions of the four-wheel-drive models have a range of 770 kilometers, ranking first among pure electric four-wheel-drive SUVs. The actual test results are also outstanding, with the standard version achieving 756 kilometers in the Autohome test, and after the display shows zero, it can still run 28 kilometers, with a range achievement rate of 93.9%; the Dongchedi test using 21-inch sports tires achieved 652 kilometers, also ranking first on the test list.
(4) Intelligence and Chassis: All models come standard with continuous damping variable shock absorbers (CDC), i.e., intelligent chassis, enhancing driving texture and comfort, with the Pro and Max versions also equipped with air suspension. Also standard are advanced driver assistance, 10 million pixel version, with 700 TOPS computing power, lidar, 4D millimeter wave radar, and Xiaomi end-to-end driver assistance and other advanced configurations.
(5) Safety and Comfort: All models come standard with double-layer laminated glass, including side triangle windows. Using an 800-volt silicon carbide high-voltage platform, there are many enhancements in safety, such as 2200 MPa ultra-high-strength steel, A-pillar and B-pillar embedded anti-roll cage structure, battery pack bottom bulletproof coating, 1500 MPa anti-scratch bottom crossbeam, etc. In addition, the car is equipped with a 1.1-meter-long horizon screen composed of three LED projections, with strong immersion; also designed specifically for female drivers in terms of sun protection and safety, with up to 36 storage spaces inside the car, with thoughtful detail designs such as magnetic tissue boxes.
(5) Design Philosophy: Designed by a designer who worked at BMW for ten years, committed to creating a non-mediocre, characterful SUV that also considers family use. During the design process, the vehicle path was deeply discussed, and the current design direction was finally determined.
(6) Color Development: Huge investment in color development, such as the inspiration for Yingqing color from Yingqing glaze, using special techniques to restore the texture of the glaze; Danxia Purple restores the color gradient of Danxia landform, with high development difficulty, undergoing multiple adjustments; Deep Sea Blue adds purple to create a deep luxury texture; Gem Green uses a two-layer paint process, extremely eye-catching; Glazed Pink developed to meet the needs of female users, achieving "attractive to both men and women" through subtle color adjustment. In addition, white presents a sporty high-end feel on the car body due to the delicate pearl powder, and black demand is met through deep color systems such as Cambrian Gray, Titanium Metal Color, and Deep Sea Blue.
(7) Intelligent Architecture: Achieves four-domain integration, integrating four domain controllers into one, reducing weight, volume, and power consumption, enhancing the upper limit of intelligence after full-link optimization, optimizing intelligent efficiency, and serving as the foundation for vehicle intelligence.
(8) Ecological Accessories: Rich ecological accessories, such as magnetic glasses case, 4K gimbal, power-taking phone charging stand, magnetic small button, magnetic tissue box, nine-color direct drinking cup, etc., all available for purchase in the Xiaomi Auto APP mall.
(9) Nürburgring Lap: Last year, the first lap at Nürburgring was not effective due to weather reasons, this year booked four times, the prototype car ran 6 minutes and 22 seconds on the second lap on April 1st, improving by 24 seconds compared to last year. The mass-produced car also performed well. To commemorate the record-breaking, launched Nürburgring limited edition, limited to 100 units, 10 units of the 2025 model were sold out that night, launched a professional track package, attracting over 100 car owners to purchase, and providing auto club professional track services.
(10) Event Sponsorship: Sponsored CEC (China Endurance Championship), naming it Xiaomi China Endurance Championship, providing YU7 as a medical car, Xiaomi Speed 74 as a safety car. Providing VIP viewing area and one-hour ultra track tour benefits for auto club members.
(11) Driving Training: Provides advanced driving training, priced at 1999 RMB, free for the first batch of 10,000 Xiaomi car owners. Training includes theoretical courses and four practical trainings such as rapid acceleration, rapid braking, reverse pile, low adhesion road surface, and Gymkhana, helping car owners experience the car's boundaries and master rescue techniques. Completed training in Beijing and Chengdu stations, the next station is Wuhan.
3. Other Products
(1) Car Models: Various car models are sold in the Xiaomi Auto APP mall, including 1:18 alloy car models (4 colors), 1:43 collectible car models, 1:64 pull-back alloy cars (6 colors, suitable for children), divided into SU7 and YU7 models.
(2) Chips: The Xuanjie chip team developed the Xuanjie chip, investing 13.54 billion RMB over four and a half years, with an annual R&D cost of over 6 billion RMB. Based on this chip, launched two tablets, a phone, and a watch, such as the Xiaomi 15s pro phone with excellent user experience.
(3) Tablets: Released Xiaomi Tablet 7 alpha 14-inch version, equipped with a 14-inch OLED screen, narrow bezel; Xiaomi Tablet 7S pro 12.5-inch version, equipped with Xuanjie OE chip, excellent performance, suitable for mobile office, supports PC-level software, can also be used as a second-row expansion screen in the car.
(4) Foldable Phones: Xiaomi mix flip 2 foldable phone, the crease is highly praised, simulating 200,000 folds over three years, the crease is less than 50 microns (about half the thickness of A4 paper), launched with the same colors as YU7, with eight colors, excellent texture.
2. Q&A
Q: Why do some people question the authenticity of Xiaomi Auto's large order data, and how to explain it?
A: Some people question it because there is a seven-day return rule for large orders. In fact, this is an industry practice, other companies call it a hesitation period, usually three days, Xiaomi set seven days mainly because of concerns about insufficient store numbers, and test drive arrangements cannot keep up.
Q: Is there a situation where SU7 users all switch to buying YU7 models?
A: There is no such situation, the number of SU7 and SU7 Max order transfers is less than 15% of the total YU7 orders, which is less than expected, giving more confidence in SU7's product strength and reputation.
Q: What solutions are there for mistakes in configuration when purchasing Xiaomi Auto YU7 models?
A: Starting at 10 a.m. this Sunday (July 6th), two days will be provided for everyone to go to the store to carefully look at and understand each configuration in the Xiaomi Auto APP. However, it is important to note that after changing the configuration, the order may need to be re-queued.
Q: Are there any benefits during Xiaomi Auto's initial sales period?
A: During the initial sales period, 55,000 RMB worth of benefits were given, including zero-gravity seats for the driver and co-driver.
Q: Why set zero-gravity seats in the driver Max version and standard version initial sales benefits, and why was this rarely done before?
A: Statistics show that 70-80% of cars on the road are driven by one person, and previously more consideration was given to the co-driver, second row, and even third row, with little attention to the driver. In fact, many drivers take a nap in the driver's seat at noon, and when the driver rests during the journey, if they want to use the zero-gravity seat, there is no need to open the door and go to the co-driver, so positioning the car for the driver is crucial. Although some domestic peers have also made zero-gravity seats for the driver, there are very few cars that do this.
Q: What work has been done for female driver safety?
A: All test items completely cover all C-NCAP crash tests, and special full-condition full-seat crash tests have been conducted for female drivers and passengers, exceeding standard requirements.
Q: What are the highlights in terms of storage for this car?
A: First, the electric front trunk is good; second, the drawer under the second-row seats is suitable for storing tissue boxes, children's toys, blankets, etc.; the car has up to 36 storage spaces; a magnetic position behind the central control screen for placing tissue boxes, both convenient and elegant. In addition, many similar functions have been made to meet user scenarios, such as the original threaded holes for phone stands, etc., with great efforts made to expand the entire ecosystem.
Q: What are the highlights of Xiaomi Auto in family design?
A: Xiaomi Auto has put a lot of effort into family design. Materials are used that can be directly contacted by infants without causing allergies; air conditioning is changed to soft wind air conditioning and equipped with HEPA filters; the rear position is large, can recline to 135 degrees, with drawers for storage, and equipped with a second-row screen as a "baby soothing tool," with large horizontal space, can seat two people after placing a safety seat, these designs benchmark Model Y and Cayenne. In addition, a pet mode has been specially studied, with a 4K gimbal added to the rearview mirror base for watching pets, and a cat bag designed to be exquisite, ventilated, breathable, and easy to take.
Q: Is the cat bag sold, and where can it be purchased?
A: The cat bag has been listed in the Xiaomi Auto APP mall, and can be purchased by logging into the Xiaomi Auto APP.
Q: What investments and achievements have been made in testing and quality for Xiaomi Auto?
A: Xiaomi Auto has made huge investments in testing and quality. SU7's actual road testing is still ongoing, having run over 10 million kilometers, mainly for durability testing, with YU7 being the second car listed on the Modena platform. 653 cars have been invested in testing, while the industry generally invests 70-250 cars, with the investment scale at least 3-5 times larger than peers. 6.49 million kilometers have been tested before the launch event. A 24-hour endurance challenge was also conducted, with a pure electric car running continuously at high speed for 24 hours (including charging time), covering 3944 kilometers, which is a comprehensive test of the vehicle's durability, charging, and heat dissipation capabilities.
Q: How is the progress of Xiaomi Auto engineers testing along the mainland border?
A: The total mileage of engineers testing along the mainland border is 35,000 kilometers, and over 30,000 kilometers have been run, with one or two weeks left to finish.
Q: What innovations does Xiaomi Auto have in intelligence?
A: Xiaomi Auto combines four domain controllers (intelligent driver assistance core computing module, vehicle control domain controller, intelligent cockpit controller, T-box communication module) into one four-in-one controller, reducing weight, volume, and power consumption, with more powerful functions. This is the foundation for vehicle intelligence, improving the upper limit of intelligence, and optimizing efficiency after full-link optimization.
Q: Is there any plan to produce Redmi cars?
A: There is no plan to produce Redmi cars.
Q: What is Xiaomi Auto's production and delivery target for this year?
A: The initial target was to deliver at least 300,000 units, after expansion, the target was revised to 350,000 units, and efforts will be made to expand capacity.
Q: Will Xiaomi Auto launch medium-to-large cars in the future?
A: Future product plans will not be disclosed, Xiaomi Auto YU7 initially is a medium-sized SUV, and visiting the store will reveal that the internal space is larger than expected.
Q: Some believe YU7's popularity has led to SU7 not selling well, what is the actual situation?
A: June was YU7's promotional period, which should have been the most stressful time for SU7, but new orders exceeded expectations, with predictions adjusted three times in a month, the entire month SU7 added 14,000 locked orders, which is quite considerable. The number of orders transferred from SU7 to YU7 is less than predicted, accounting for less than 15% of YU7's total orders. SU7 has been delivered for 15 months, with cumulative deliveries very close to 300,000 units, indicating the car's excellent quality, strong competitiveness, and sufficient reputation, with many people preferring sedans.
Q: Why brush laps at Nürburgring?
A: Over 100 years, all great companies have started by brushing laps, high-performance lap times are equivalent to high-target traction, forcing the car to be made well. Brushing laps at Nürburgring is a comprehensive test of the car's power, chassis, brakes, heat dissipation, reliability, durability, safety, etc., and is a test of the entire technical capability. The company decided to make world-class cars at Nürburgring, and the car's architecture can reach the current level. The company challenges Nürburgring, firmly benchmarking Porsche, using the track as the highest testing ground to refine technology and testing capabilities, and continuously applying the capabilities and technology refined on the track to mass-produced cars, enhancing the driving texture and quality of mass-produced cars.
Q: What arrangements has the company made at Nürburgring to express determination?
A: The company has officially rented a 2780 square meter office at Nürburgring, expected to be used early next year. Also grabbed two billboards at the Yokohama Bridge at Nürburgring, now called Xiaomi Bridge, with approximately 2.5 million visitors brushing laps at Nürburgring each year able to see Xiaomi advertisements. The company plans to brush laps at Nürburgring in ten-year units.
Q: What are the characteristics and limitations of the Nürburgring limited edition car?
A: The Nürburgring limited edition is a mass-produced car with some modified and optional parts, selected professional track package, and made safety modifications that comply with regulations. Equipped with six-point seat belts and half-roll cage, removed rear tires and installed half-roll cage, also obtained official Nürburgring brand authorization, printed with official Nürburgring logo. The permanent total limit of the Nürburgring limited edition is 100 units, with 10 units of the 2025 model sold out that night.
Q: What efforts has Xiaomi made in track culture?
A: Xiaomi has made many efforts in track culture. Over 100 car owners selected professional track package, locked orders that night, and provided auto club professional track services, including car maintenance, repair, tire services, etc. Xiaomi sponsored CEC, with the event's full name changed to Xiaomi China Endurance Championship, with the event's safety car and medical car being Xiaomi travel cars, with the safety car being Xiaomi SU7.
Q: What car model products does Xiaomi have, and where can they be purchased?
A: Xiaomi has 1:18 alloy car models, with 4 colors; 1:43 collectible car models; and 1:64 pull-back alloy cars designed for children, with 6 colors, divided into SU7 and YU7 models. These car models are available for sale in the Xiaomi Auto APP and the APP's community mall.
Q: Why is the price of Xiaomi tissue boxes expensive, and what are the future plans?
A: The price of Xiaomi tissue boxes is expensive because the design materials and manufacturing process are complex, initially unable to pass vehicle regulations testing, later changed materials and glue, leading to extremely high costs. Currently priced at over 100 RMB each, still expensive, efforts are being made to force relevant personnel to reduce costs and redesign.
Q: What is the development cost and application situation of the Xuanjie chip?
A: The Xuanjie chip development took four and a half years, with a total cost of 13.54 billion RMB as of April this year, with an annual R&D cost of over 6 billion RMB. The Xuanjie chip is applied to two tablets (Xiaomi Tablet 7 alpha 14-inch version, Xiaomi Tablet 7S pro 12.5-inch version), a phone (Xiaomi 15s pro), and a watch.
Q: What colors are available for the small folding products prepared by Xiaomi with the same colors as the car?
A: There are eight colors available, including Deep Sea Blue, Yingqing Color, Danxia Purple, Pink, Titanium Metal Color, Gem Green, etc.
Q: Previously said to surpass Model Y, now the product is released and has the first wave of results, has it really surpassed Model Y?
A: It is the earliest group of Tesla Model S users, specifically bought several Model Y facelift versions early this year for benchmarking and learning, believing Model Y is very good and remarkable, hoping to use Tesla as a benchmark, to approach and even surpass Tesla step by step in all dimensions, Model Y is still a very good product.
Q: When will Xiaomi Auto products go abroad, and what is the current preparation situation?
A: Because there are too many people queuing domestically, priority will be given to solving domestic delivery issues, and going abroad will be considered around 2027, focusing on doing domestic things well first.
Q: If someone calls Xiao Ai outside the car, will it open the car?
A: Xiao Ai outside the car is turned off by default and needs to be actively turned on; if there are people inside the car, external voice will be disabled to prioritize protecting people inside the car. At the same time, Xiao Ai outside the car supports voiceprint recognition, only matching one's own voice, and detecting the presence of Bluetooth keys and digital keys, will the vehicle execute external voice commands, with many safety tests conducted.
Q: Do Xiaomi internal personnel have internal prices for purchasing their own products?
A: All Xiaomi products need to be purchased with money, no discounts, no internal prices.
Q: How do you view He Xiaopeng buying Xiaomi Auto YU7Pro and posting on Weibo?
A: Having nearly 20 years of friendship with He Xiaopeng, seeing He Xiaopeng buy the car and repost on Weibo and express gratitude, believing that in the same industry, there should not only be fighting but also brotherhood, also wishing Xiaopeng's new car launch success, welcoming everyone to support XPeng Auto.
Q: Why not consider body-colored wheels and wheel arches?
A: The car is customized, if there are too many customization items, it greatly affects the entire production rhythm, every choice is carefully weighed, and many users have been surveyed. Future strategies regarding options will be explained separately in detail.
Q: Can children visit the Xiaomi Auto factory during summer vacation, and how to make an appointment?
A: Children are very welcome to visit the Xiaomi Auto factory, appointments can be made in the Xiaomi Auto APP. Currently, 100,000 people visit the Xiaomi Auto factory annually, the queue is a bit long now, and more factories may be opened for visits in the future once things are sorted out.
Q: Can Xiaomi Auto produce right-hand drive modifications?
A: Currently, no right-hand drive cars have been made, and there is a plan to go abroad in the year after next.
Q: When can the 10 million Clips assisted driving SUV series be used?
A: The SUV is expected to be launched in late July, with a large-scale media teacher test drive held, with significant progress praised by everyone.
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