Goldman Sachs has recently increased its electric vehicle (EV) sales forecast for Xiaomi, citing a more positive outlook on demand and manufacturing capacity. Analyst Timothy Zhao’s team raised their EV sales forecast for Xiaomi to 350,000 units in 2025, up from the previous estimate of 290,000 units. This represents a 21 percent increase above the current consensus estimate.
Furthermore, the team also adjusted their forecast for Xiaomi’s EV sales in 2026, now projecting 655,000 units compared to the previous estimate of 480,000 units. This new forecast is 48 percent higher than the current consensus.
The team currently values Xiaomi’s EV business at RMB 272 billion ($37 billion), with a 12-month forward price-to-sales ratio of 1.7x. This valuation is higher than the average ratio of 1.0x for other prominent EV manufacturers like Li Auto, Xpeng, and Nio.
Goldman Sachs believes that Xiaomi’s strategy of focusing on “hero products,” starting with the SU7 model and potentially expanding into larger markets, will drive long-term growth and profitability for the company. The bank anticipates that Xiaomi’s smart EV business will transition from an operating loss of RMB 6.8 billion in 2024 to less than RMB 4 billion in 2025, potentially reaching a profit inflection point in 2026.
Xiaomi officially launched its first EV model, the SU7, in March 2024, with deliveries commencing in April of the same year. The SU7 is available in three versions – Standard, Pro, and Max – with varying price points. The company also introduced the more powerful SU7 Ultra for pre-sales in China at a significantly higher price point.
In addition to the SU7 models, Xiaomi announced its second EV model, the YU7, with plans for the SUV model to be launched in mid-2025. The company’s founder, chairman, and CEO, Lei Jun, revealed that Xiaomi delivered over 135,000 vehicles in 2024 and aims to deliver 300,000 vehicles by 2025.
To support its EV initiatives, Xiaomi has invested in research and development, with plans to spend RMB 13 billion on EVs and other new projects in 2025. The company also signed a deal to build a 300,000-vehicle-per-year plant in Yizhuang, Beijing, with both phases of the plant expected to have an annual capacity of 150,000 vehicles.
Overall, Goldman Sachs’ revised sales forecast for Xiaomi’s EV business reflects a positive outlook for the company’s growth and profitability in the electric vehicle market.
