Following the successful launch of its first electric vehicle (EV), Xiaomi is reportedly gearing up to introduce its second model, possibly an SUV, by the end of this year, according to a report from local media outlet Lanjinger.
Xiaomi officially unveiled its first model, the SU7 electric sedan, yesterday, pricing it at RMB 215,900 yuan ($29,870), which is RMB 30,000 lower than the starting price of the Tesla Model 3 in China. The SU7 received an overwhelming response, with Xiaomi announcing that it had received 50,000 firm orders in the first 27 minutes of availability.
Unlike many other new local car manufacturers that prioritize SUVs for their first models, Xiaomi’s decision to launch a sedan has sparked discussions. Xiaomi’s founder, chairman, and CEO, Lei Jun, defended this choice, stating that sedans offer a better driving experience and are more suitable for daily use by one person, as well as for a two-person world and a small family.
Lei highlighted the significant demand for sedans in the market, which he believes is comparable to that for SUVs. He acknowledged the challenges in creating a good pure electric sedan, noting the limited options available in the market.
While sedans are typically less profitable for EV makers compared to SUVs, Xiaomi appears focused on building its brand image with its first model, aligning with industry practices in the new energy vehicle (NEV) sector. Feng Li, a senior automotive industry analyst, suggested that it’s normal for the first and second models to be unprofitable, with profitability becoming a key focus for the third model to ensure long-term viability.
Xiaomi’s entry into the EV market comes at a time when competition is intensifying, with several established and new players vying for market share.
