Xiaomi Corp. is expanding the size of a planned second electric car factory in Beijing, according to a person familiar with the matter, after the success of its first model prompted billionaire co-founder Lei Jun to raise this year’s sales target to 350,000 vehicles.

The company, better known for its smartphones, started construction of a second factory last year on a 53 hectare (131 acre) parcel of land in the capital’s Yizhuang district that it bought for 842 million yuan ($116 million). Production at that facility is set to start mid-year.

The latest expansion will see the facility incorporate an adjoining plot of around 52 hectares, the person said, declining to be named because the information is private. Xiaomi didn’t respond to requests for comment.

Xiaomi’s first factory has a designed annual production capacity of around 150,000 vehicles, though the company has taken measures including optimizing work flow to boost output to help fill a backlog of orders. Lei had previously set a target of delivering 300,000 cars this year.

The plan comes as Xiaomi’s SU7 electric sedan and its Ultra race car version prove popular with buyers, shipping more than 200,000 units in less than a year. A sport utility vehicle, the YU7, will launch in summer to expand Xiaomi’s lineup and take on Tesla’s Model Y and other competitors in the heavily crowded category.

The EV business helped the company achieve its fastest revenue growth since 2021, with profits in the fourth quarter rising by 90%, beating analyst estimates by a large margin.

The tech company’s shares have quadrupled over the past year on the stellar performance, making Xiaomi stock more expensive than larger Chinese internet companies Alibaba Group Holding Ltd. and Tencent Holdings Ltd.