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Tough Indian market means Xiaomi may miss sales target

Market researchers are expecting a dip in Xiaomi's smartphone sales, which will cause the company to miss its 100 million 2015 sales target.

Published onNovember 2, 2015

Xiaomi Redmi Note 2-8

Xiaomi has been one of the fastest growing smartphone companies for successive quarters and pitched a lofty sales target of 100 million unit this year back at the start of 2015. However, the Chinese smartphone manufacturer is thought likely to miss this target by quite a margin, raising concerns about the company’s future growth prospects.

Xiaomi CEO Lei Jun already scaled back this target to 80 million phones in March, but even this figure began to look in doubt after the company announced that it had sold 34.7 million smartphones come the first half of 2015.

[related_videos title=”Xiaomi in video:” align=”right” type=”custom” videos=”640394,621025,594382,588731″]The latest estimate from market research firm Trendforce suggests that Xiaomi will sell 70 million phones this year. While still a gain on 2014’s 60 million sales, it’s quite a long way from Xioami’s initial expectation for the year. Canalys research expects that Xiaomi’s Q3 sales in 2015 actually dropped year-on-year, a first for the company.

This news comes despite Xiaomi entering the Indian smartphone market, which was expected to give the company a substantial sales boost. However, saturation in its home territory of China and the nature of the highly competitive Indian market has created a difficult environment for the company. Xiaomi has not had quite the major impact on India that perhaps had been expected, the company is currently sitting with less than the 4 percent of the market that it grabbed when it first entered India. Instead, Chinse rivals such as Lenovo and local Indian manufacturers have secured larger shares of the market.

Xiaomi’s expansion plans could still prove key to the company’s future growth. The company has not yet made a move on many major global markets yet, with Europe and much of Asia still relying on import retailers to try out Xiaomi’s products. Talk is also increasingly turning to the company’s eventual US launch, with a handset also spotted at the FCC recently too. Furthermore, Xiaomi is increasingly moving into new areas of consumer electronics, which could help the company withstand any slowdown on the mobile market.

Redmi 2 Pro passes through the FCC, sparks speculation about Xiaomi's US launch

Despite a slowdown this year, Xiaomi still has plenty of room left to manoeuvre and the firm is still growing. But even China’s latest mobile darling isn’t immune to the highly competitive nature of the low cost smartphone market.

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