Xiaomi's first EV models launched at competitive pricing, aims to be China's Tesla

Marking its debut into the competitive electric vehicle (EV) market, Xiaomi, on Thursday, announced the launch of its EV models, unveiling aggressive pricing strategies aimed at capturing market share in China's automotive landscape.

At a presentation in Beijing, Xiaomi's co-founder Lei Jun revealed the company's ambitious strategy, showcasing the SU7 range of electric vehicles with a starting price of 215,900 yuan (approximately ₹25 lakh).

With a multiyear undertaking and a substantial $10 billion budget, Xiaomi is positioning itself to challenge established players like Tesla and BYD in the burgeoning EV sector.

The announcement triggered a surge in Xiaomi's shares, reflecting investor optimism about the company's foray into EVs and its potential to revitalise Xiaomi's business amidst a stagnant smartphone market.

“I didn’t expect Apple to quit,” Lei said on stage in Beijing, before an audience of tens of millions across Chinese streaming platforms. After diving into the details of his cars’ design and engineering — from nine different colour options to a laptop-friendly glove box and triple-layer UV protection in the windshield — the CEO returned to the topic of his smartphone-making rival. “Xiaomi will support Apple users just as well,” he said.

Xiaomi's turquoise-blue EV models have already garnered attention in stores across China, generating excitement among consumers eager to experience the company's latest offering. By partnering with Beijing Automotive Group Co. and strategically expanding its retail footprint, Xiaomi aims to establish a strong presence in key Chinese cities and capitalize on growing demand for electric vehicles.

To avoid delays in obtaining regulatory approval, Xiaomi partnered with state-owned Beijing Automotive Group Co. for the new vehicles. The cars are going on sale in 59 stores across 29 Chinese cities.

Initiated three years ago, Lei has called the EV endeavour his final entrepreneurial bet and has dedicated most of his attention to it in recent times. Xiaomi aspires to become a top global carmaker in 15 to 20 years, Lei said when he first unveiled the SU7 in December. President Lu Weibing has added that the company’s goal is to have one of China’s three best-selling luxury EV models.

The ambitious EV bet arrives at a time of slowing growth for China’s electric car purchases. Industry bodies project 25% growth in sales for 2024, down from 36% last year and 96% in 2022.