- Xiaomi enters EV market: SU7 reservations; price competition with Tesla
- SU7 touted against Tesla; production by BAIC Group unit
- Xiaomi invests $10B; China’s EV market stable; regulatory scrutiny
Xiaomi, a Chinese smartphone manufacturer, has begun accepting reservations for its first electric vehicle (EV).
Lei Jun, chief executive officer of the technology behemoth, announced at the event that the base price of the SU7 would be 215,900 yuan ($29,872; £23,663), while the Max model would cost 299,900 yuan.
The company reports receiving more than 50,000 orders in the initial 27 minutes of sales.
As sales growth has halted globally, a price war has ensued, prompting Xiaomi to enter the electric vehicle market.
The action pits the technology titan against electric vehicle competitors such as Tesla and BYD. In China, the Model 3 from Tesla begins at a price of 245,900 renminbi.
Additionally, Mr Lei stated that the SU7, which has been compared to the Porsche Taycan and Panamera, would have a greater minimum range than the Tesla Model 3 (567 kilometres) at 700 kilometres (435 miles).
The company hopes that existing consumers will find the SU7’s operating system, which is shared with its smartphones, laptops, and other devices, to be appealing.
With an approximate 12% market share, Xiaomi is the third-largest smartphone manufacturer in the globe, per the research firm Counterpoint.
Xiaomi has been teasing the SU7 since the previous year; it has been compared to the Porsche Taycan and Panamera sports car variants.
A unit of the state-owned automobile manufacturer BAIC Group will manufacture it at a facility in Beijing with the capacity to produce up to 200,000 vehicles annually.
Automobility’s Bill Russo stated that while reaching this point is a significant accomplishment in and of itself, the ultimate goal would be to prove that there is a consumer market for Xiaomi as a brand of smart EVs.
As an indication of the difficulties faced by technology companies attempting to manufacture electric vehicles, iPhone manufacturer Apple reportedly abandoned its intentions to produce an EV last month.
According to Mr. Russo, Xiaomi’s foray into the automotive sector demonstrated the company’s “confidence in the relevance of their brand” in China, whereas Apple failed to perceive sufficient potential in the electric vehicle market beyond China.
Xiaomi has announced that over the next decade, it will invest $10 billion (£7.9 billion) in its vehicle business.
“The Chinese electric vehicle (EV) market is extremely developed and provides EV manufacturers with a very stable ecosystem,” said Abhishek Murali of the research firm Rystad Energy.
For instance, the battery supply chain is exceptionally robust, and the nation’s charging infrastructure is expanding to accommodate the increasing EV feedstock.
At the time of the introduction of Xiaomi’s first vehicle, a price battle has intensified in China’s EV market.
In recent months, Tesla, led by multibillionaire Elon Musk, has reduced the price of its vehicles in China by thousands of dollars. In contrast, local competitors such as BYD, the leading electric vehicle manufacturer globally, have also reduced their prices.
The global automotive industry is already saturated with competitors, making Xiaomi one of the few potential new entrants to receive authorization from regulatory bodies as they attempt to impede an influx of fresh participants.
Although BYD reported record annual profits earlier this week, the company acknowledged that growth had decelerated in late 2018.
Nio, a manufacturer of electric vehicles headquartered in Shanghai, reduced its delivery forecast for the first quarter on Wednesday, citing reduced consumer spending and weakening Chinese economic growth.
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Next week, the American electric vehicle (EV) behemoth Tesla is scheduled to release its delivery figures for the initial quarter of 2024.
Simultaneously, governments across the globe are opposing the importation of electric vehicles manufactured abroad.
Beijing petitioned the World Trade Organisation on Tuesday to commence dispute settlement proceedings against the United States in an effort to challenge “discriminatory subsidies” authorized by the US Inflation Reduction Act.
In the interim, an inquiry has been initiated by the European Union to determine whether Chinese government subsidies have facilitated the undermining of European-made models by Chinese electric vehicle manufacturers.
