Xiaomi (1810.HK), opens new tab will this month start deliveries of its first electric vehicle (EV) in China, it said on Tuesday, venturing into the world’s largest auto market at a time of aggressive price competition, according to Reuters.
The smartphone maker, China’s fifth-largest, said in a Weibo post that 59 of its stores in 29 cities nationwide will take orders for its new Speed Ultra 7 (SU7) sedan. A launch event is scheduled for March 28, when the new EV’s sticker tag is expected to be made public.
China’s EV sales climbed 18% in January-February, not far from the 21% growth seen for all of 2023. This year, market leader BYD (002594.SZ), opens new tab led a round of deep price cutting to try to woo consumers in the face of weaker domestic demand.
At the unveiling of the SU7 in December, Chief Executive Lei Jun said Xiaomi planned to become one of the world’s top five automakers.
Lei said the SUV has “super electric motor” technology capable of delivering faster acceleration than Tesla’s (TSLA.O), opens new tab and Porsche’s EVs.
Analysts say the car’s shared operating system with Xiaomi’s popular phones and other electronic devices will appeal to the company’s existing customers.
“Xiaomi’s cars are going from zero to one in a very different growth stage and facing very different user expectations compared to when Xiaomi’s smartphones went from zero to one 14 years ago,” Lei said in a Weibo post on Tuesday.
“Xiaomi’s cars need to be different, and the most important aspect is smart technology.”
Xiaomi has been seeking to diversify beyond its core business to EVs as demand for smartphones is stagnant – a plan it first flagged in 2021.
Its cars will be produced by a unit of state-owned automaker BAIC Group (1958.HK), opens new tab, in a Beijing factory with an annual capacity of 200,000 vehicles.
The smartphone giant has pledged to invest $10 billion in autos over a decade and is one of the few new players in China’s EV market to gain approval from authorities who have been reluctant to add to a supply glut.