China’s electric vehicle (EV) sector has experienced rapid growth propelled by purchasing subsidies that came to an end in late 2022. Dozens of domestic automakers are now engaged in a fierce price war to gain an edge in a competitive market.
Xiaomi, renowned for its affordable smartphones and home appliances, has now unveiled its entry into the EV space with the SU7. CEO Lei Jun is staking his reputation on this new venture, aiming to take on Chinese car giant BYD and Elon Musk’s Tesla.
During a glamorous launch news conference in Beijing, Lei revealed that the base model of the SU7 would be priced at 215,900 yuan ($29,868). The sleek and sporty vehicle will be available in nine different colors and features “sound simulation” to provide an exhilarating sports car driving experience. Additionally, the SU7 boasts various other amenities, including karaoke equipment and a mini-fridge.
Xiaomi has promised that the SU7 will be the best-looking, best-driving, and smartest car priced under 500,000 yuan. Analyst Johnson Wan from Jefferies Financial Group Inc noted that the 200,000 to 250,000 yuan range is currently the most competitive segment in the Chinese EV market.
Lei Jun confidently stated at the news conference that the SU7 is on par with Tesla’s Model 3 and even surpasses the American sedan in certain aspects. “I believe we can offer a superior product for Model 3 users,” Lei remarked.
Given Xiaomi’s position as the world’s third-largest smartphone manufacturer, the company’s expertise in that sector has significantly influenced its EV strategy. Xiaomi’s president, Lu Weibing, explained to CNBC that leveraging the company’s existing user base of around 20 million premium smartphone users played a key role in pricing the SU7 competitively.
“We anticipate a significant overlap between our initial EV purchasers and our smartphone users. That forms a core part of our strategy,” Lu highlighted.
