Shares of China’s Xiaomi, listed in Hong Kong, jumped more than 5% on Friday, reaching a record high just one day after the company unveiled its new electric vehicle that received an enthusiastic market response.
Xiaomi, a relatively new contender in the electric vehicle market, introduced its luxury electric SUV, the YU7, directly challenging Tesla. CEO Lei Jun announced that the YU7’s starting price is 253,500 yuan ($35,322), which undercuts Tesla’s Model Y in China by 10,000 yuan.
Within three minutes of the YU7’s launch, Xiaomi reported over 200,000 orders, highlighting strong consumer interest.
Market Expectations and Production Forecasts
Ahead of the price reveal, a Citi report had predicted the YU7 would be priced between 250,000 and 320,000 yuan ($34,800 to $44,590), with anticipated monthly sales of approximately 30,000 units and annual sales potentially reaching 300,000 to 360,000.
The YU7 follows last year’s SU7 sedan launch, which was also priced below Tesla’s Model 3.
Lei claimed the YU7 surpasses Tesla’s Model Y on many fronts, except for driver assistance, where it currently lags. The SUV’s driver-assist system runs on Nvidia’s Thor chip, offering advanced capabilities. Pre-sales began Thursday night, with deliveries expected within one to five weeks.
The vehicle boasts an impressive driving range of at least 760 kilometers (472 miles), outpacing Tesla’s extended-range Model Y’s 719 kilometers — a key advantage for buyers concerned about frequent charging.
AI-Powered Innovations and Connectivity
While Xiaomi has not heavily promoted AI features compared to other brands, the YU7 launch showcased several AI integrations, such as controlling music with hand gestures and using an app to locate the parked car. The vehicle also supports Apple CarPlay and Apple Music.
In addition to the YU7, Xiaomi launched AI-connected smart glasses competing with Meta’s Ray-Ban model. These glasses can adjust lens tint, scan QR codes for payments, and feature AI-driven functionalities like photo and video capture, object identification, and text translation.
Priced starting at 1,999 yuan ($279), the glasses currently have no plans for international sales, whereas Meta’s smart glasses are not officially available in China.
What The Author Thinks
By pricing the YU7 below Tesla’s Model Y and delivering strong early demand, Xiaomi is signaling its serious intent in the electric vehicle market. Its focus on extended range and AI-powered features caters to consumers’ evolving expectations, positioning the company as a formidable challenger. While still new to the EV sector, Xiaomi’s aggressive pricing and rapid innovation could disrupt the current market dominance of established players like Tesla.
Featured image credit: Wikimedia Commons
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