Xiaomi Comes Up With A 'Tesla Killer' - New Vehicle Sold 200k Units In Under Five Minutes

Xiaomi has long been recognised for its global presence in the tech world, but a recent venture into electric vehicles has garnered much attention.

The company's new car, touted by some as a potential rival to industry giants, recently achieved an astonishing sales feat.

Xiaomi's newly launched car, priced just below Tesla's Model Y, has rapidly captured the attention of hundreds of thousands of buyers.

The Chinese smartphone and electric vehicle manufacturer announced on Weibo on Thursday that its YU7 car garnered over 200,000 orders within three minutes of its launch event in Beijing.

Unprecedented Demand for the YU7

In a follow-up Weibo post, Xiaomi revealed that orders for the vehicle surpassed 289,000 within an hour of sales commencing. The car, which starts at $35,000 (£25478.25), aims to challenge the Model Y, China's best-selling SUV, which begins at $36,760 (£26759.44). Xiaomi introduced the YU7 on 26 June as a high-performance luxury SUV.

During the launch event, Lei Jun, Xiaomi's founder and CEO, repeatedly highlighted direct comparisons with Tesla. 'Tesla previously stated, "Go ahead and compare,' and we at Xiaomi simply refuse to concede defeat. Today, we officially accept Tesla's challenge to compare,' Lei announced on Thursday.

Taking on Tesla: A CEO's Challenge

Tesla CEO Elon Musk has remained silent regarding the remarks made by Lei Jun during the launch event. However, given Musk's known tendency to address such comments publicly, a response from him is widely anticipated.

Market Reaction and Investor Confidence

Following robust demand for orders, Xiaomi's stock in Hong Kong surged 8% to reach an unprecedented high on Friday. However, it has since eased back, now trading 2.6% higher at 59.60 Hong Kong dollars (£5.53).

'YU7 seems to be selling like hot cakes despite slightly higher pricing,' noted Jefferies analysts, led by Edison Lee, in a Thursday report. 'YU7's pricing is slightly below that of Tesla Model Y, but it offers much better specs/performance,' the analysts observed.

'Model Y is the main target of YU7, and thus, we expect YU7 would be able to take market share from Model Y,' Lee added.

EV Price Battles Intensify

Chinese manufacturers, including Xiaomi, BYD (the world's leading EV company by sales volume), Nio, and Xpeng, have been actively lowering prices. This strategy has allowed them to gain considerable market share in both China and Europe, according to Business Insider.

The introduction of the YU7 further intensifies the ongoing electric vehicle price competition, creating additional challenges for Tesla in the Chinese market.

Xiaomi's Expanding Automotive Ambitions

The YU7 marks Xiaomi's second vehicle offering since its entry into the electric vehicle sector last year with the SU7 sedan. The SU7 sedan, which is priced lower than Tesla's Model 3, has surpassed Model 3 sales in China every month since December, and it's also garnering attention from notable figures in the US.

In October, Ford's CEO, Jim Farley, expressed his strong reluctance to part with the Xiaomi SU7 he had been driving for the past six months.

Xiaomi's stock has seen a significant 72% year-to-date increase, driven by robust sales of SU7 devices, continued strong performance in the smartphone market, and the successful expansion into home appliances.

The Road Ahead

Xiaomi's rapid rise in the EV market, spearheaded by the swift success of the YU7 and sustained interest in the SU7, signals a significant shift. As the company continues to challenge established players and expand its offerings, the automotive industry's competitive landscape is poised for even more dynamic changes.