Sales of Xiaomi’s first electric car exceed expectations

Chinese smartphone maker Xiaomi launched its first electric car SU7 late last month with an attractive price tag of USD 30,000 for the base model. With styling cues drawn from Porsche, the car has entered a cut-throat Chinese EV market with a base variant USD 4,000 cheaper than the base model of Tesla’s Model 3 in China.

It has been reported that the sales of the car have been 3-5 times higher than expected, Lei Jun, CEO of Xiaomi said on Thursday, as the company started delivering standard versions of the SU7 to buyers ahead of schedule.

Xiaomi has started the delivery of a limited batch of 5,000 cars already produced, called the ‘Founder’s Edition’. These cars are equipped with additional accessories for early buyers. However, Thursday marked the beginning of deliveries of the SU7’s standard version in Beijing and Shenzhen. 

According to Lei, Xiaomi had preponed its standard delivery by 12 days. When asked about the future development plans, he said Xiaomi has no plans to build off-road vehicles and would primarily focus on the SU7. “As for the software, I require it to be quickly iterated at least once a month. If there are any problems, they should be improved as soon as possible,” he said.

Xiaomi had previously said that it plans to start deliveries of Max models this month, and Pro models by the end of May.

The debut of Xiaomi’s electric vehicle has shaken the Chinese market, followed by other Chinese EV brands with competitive models announcing price slashes and subsidies after its launch.

Even though the world’s largest auto market could prove to be challenging for newcomers due to the tedious EV price war and decreasing demand, analysts have stated that Xiaomi has deeper pockets than most EV startups and its smartphone expertise gives it an undeniable edge in smart dashboards – a differentiating factor for Chinese consumers.

Analysts have predicted that SU7 could incur substantial losses. Based on a projected volume of 60,000 units this year, Citi estimates that the SU7 could generate a net loss of 4.1 billion yuan or an average of 68,000 yuan per car.