Chinese smartphone maker Xiaomi announced on Wednesday that it has received over 100,000 orders for its inaugural electric vehicle, the SU7, as it commenced deliveries.
During a ceremony in Beijing commemorating the first deliveries, CEO and founder Lei Jun expressed, “Xiaomi’s car officially debuts, marking the true onset of the smart car revolution, and China will undoubtedly witness the rise of a formidable company akin to Tesla.”
The initial deliveries stem from a limited production run of 5,000 cars, known as the “Founder’s Edition,” featuring supplementary accessories for early purchasers.
After the launch of the SU7, also dubbed as the Speed Ultra 7, last week, Xiaomi cautioned sedan buyers about potential wait times of four to seven months, indicating robust demand.
Xiaomi’s stock surged by as much as 16% on Tuesday as interest in the SU7 intensified, despite a brokerage firm’s projection that the company could incur losses of nearly $10,000 per vehicle this year. However, its shares dipped over 3% on Wednesday morning, contrasting with a 1.1% decline in the broader Hang Seng Index.
At its peak on Tuesday, the company boasted a valuation of $55 billion, with a share price of HK$17.34—surpassing the valuations of traditional U.S. automakers General Motors and Ford at $52 billion and $53 billion, respectively.
Entering a competitive Chinese EV market, Xiaomi’s SU7 attracted attention with its enticing price tag, starting below $30,000 for the base model, undercutting Tesla’s Model 3 in China.
Despite the challenges posed by China’s fiercely competitive EV market and slowing demand, analysts believe Xiaomi possesses deeper financial reserves than most EV startups. Additionally, its expertise in smartphones provides an advantage in developing smart dashboards—a feature highly valued by Chinese consumers.
With the majority of its $37.5 billion revenue stemming from smartphone sales, the launch of the SU7 marks the realization of Lei’s ambition. He declared the company’s venture into EVs in 2021, committing to invest $10 billion in the auto business as “the final major entrepreneurial project” of his career.
