Xiaomi, a name typically associated with smartphones, smart home appliances, and consumer electronics, has made a surprising entry into the electric vehicle (EV) sector. The company has been dubbed the “Apple of China,” reflecting its ability to produce high-quality devices at competitive prices. While its smartphones and gadgets have often been viewed as alternatives to those from giants like Samsung, Xiaomi’s foray into automobiles raises questions about its potential impact on the crowded EV market. With the launch of its SU7 model in March 2024, the company’s ambitions are crystal clear, but can it truly challenge established players?
Upon its release, the SU7 electric sedan achieved the remarkable feat of nearly 90,000 pre-orders within 24 hours—a statistic that could position it as the fastest-selling car on record. The SU7 has drawn comparisons to luxury models like the Porsche Taycan, not just for its aesthetic appeal but also for its performance. An enhanced version, the SU7 Ultra, captured attention with a staggering output of over 1,500 horsepower, even setting a new lap record at the Nürburgring racetrack earlier in November, outperforming notable competitors by a significant margin.
However, a thorough examination of this achievement reveals nuances that must be acknowledged. The impressive Nürburgring lap time was achieved by a prototype that, while it demonstrates Xiaomi’s engineering capability, is not representative of a street-legal vehicle. Comparisons to previous electric racing benchmarks further highlight the complexity of this instance—for instance, the Nio EP9 recorded a quicker time in 2017, and the Volkswagen ID.R currently holds the outright electric lap record. Thus, while these accomplishments are noteworthy, they must be contextualized within the broader electric vehicle landscape.
Despite entering the automotive field relatively late, Xiaomi’s sales have surged impressively, prompting the company to revise its 2024 delivery forecasts upward multiple times—from an initial estimate of 76,000 to a more ambitious 130,000. In an industry already dominated by established manufacturers, Xiaomi’s speed in adapting and scaling production is remarkable. It’s telling that even before the SU7 launched, it had already outsold some competitors like XPeng, which has been operational for several years.
Industry expert Mark Rainford underscored this rapid growth, noting that Xiaomi’s revised delivery projections exceed the total number of units sold by long-standing EV companies through September. The market’s reception of Xiaomi Auto has not only been bolstered by strong demand but has also been complemented by robust financial performance across the company, with a reported revenue growth of 30.5 percent in the third quarter of the year.
Notably, the reception of Xiaomi’s vehicles has transcended mere sales figures. Ford’s CEO, Jim Farley, has publicly praised the SU7 after driving it in the U.S. His candid admission about enjoying the vehicle and not wanting to return it speaks volumes about the car’s quality and the brand’s positioning. He pointed out that the market was abuzz with the notion of an “Apple car,” while Xiaomi had already made its mark with a stunning vehicle that has a strong consumer appeal in China.
Such endorsements from industry leaders amplify Xiaomi’s credibility as a serious automotive contender and signal a shift in how traditional automotive companies might view an electronics-focused brand muscling into their territory.
At a price point starting under $30,000, the SU7 offers an enticing alternative to established vehicles like the Tesla Model 3, which is priced approximately $4,000 higher. Even the high-performance SU7 Ultra appears competitively priced at about $112,500, especially considering its power and capabilities.
Yet, Xiaomi faces formidable challenges within the highly competitive Chinese electric vehicle market. With rivals like BYD and MG gaining traction, particularly in international markets, Xiaomi’s journey is fraught with obstacles. Moreover, regulatory tariffs complicate prospects in markets like the U.S., where Chinese car manufacturers face barriers that limit their ability to penetrate the consumer base effectively.
Xiaomi’s venture into the electric vehicle market is undoubtedly ambitious and dynamic, showcasing not only its adaptability but also substantial market potential. Nevertheless, whether Xiaomi can transform its initial success into sustained growth and long-term viability in the automotive sector remains to be seen. The coming months and years will be crucial as Xiaomi navigates the challenges of scale, competition, and consumer expectations in the automotive landscape.