Xiaomi is setting its sights on Tesla’s crown in China’s electric SUV market, with CEO Lei Jun publicly stating that the company’s upcoming YU7 model is aiming to outsell the Tesla Model Y, the country’s best-selling premium electric SUV.
The announcement comes just days before the official launch of the YU7, Xiaomi’s second electric vehicle. Expectations are high following the remarkable success of the SU7, which has exceeded industry forecasts by achieving over 180,000 deliveries since its early 2024 launch. The vehicle has become a notable competitor to Tesla’s Model 3, which now faces significantly lower delivery wait times amid Xiaomi’s rising sales.
Xiaomi, traditionally known for consumer electronics, entered the automotive space in 2021. Despite its newcomer status, the company ramped up SU7 production at an unprecedented pace, leading to months-long backlogs for new orders. In contrast, Tesla’s Model 3 is readily available for delivery in China, with added incentives such as 0% financing.
Now, Xiaomi is preparing for what could be an even greater challenge: competing with the Model Y, which is not only Tesla’s top-selling model in China but also the best-selling vehicle globally. Lei Jun stated via social media that Xiaomi’s goal is to surpass Model Y sales in China, acknowledging the benchmark Tesla has set in the industry.
The Model Y currently outsells the Model 3 by roughly a 2-to-1 margin in China, with about 80,000 units delivered per quarter. If Xiaomi achieves its target with the YU7, it would mark a significant shift in the Chinese EV market and raise the competitive stakes between traditional automakers and tech-driven newcomers.
