China’s Xiaomi announced on Tuesday that it will begin deliveries of its first electric vehicle (EV) model, the SU7, this month, entering the world’s largest auto market amid a fierce price war.
The smartphone maker, China’s fifth-largest, said in a Weibo post that it has 59 stores in 29 cities across the country that will accept orders. A launch event is set for March 28, when the new EV’s sticker tag is expected to be revealed.
Xiaomi’s stock rose 7% during morning trading.
China’s EV sales increased by 18% in January-February, which is not far from the 21% growth forecast for the entire year 2023. This year has seen a round of deeper price cuts led by market leader BYD to entice consumers amidst weak domestic demand.
According to Lei, the SU7 has “super electric motor” technology that can accelerate faster than Tesla and Porsche EVs.
Analysts believe that the car’s shared operating system with Xiaomi’s popular phones and other electronic devices will appeal to the company’s current customers.
Xiaomi has been looking to diversify beyond its core business into EVs in the face of stagnant smartphone demand, a strategy it first announced in 2021.
Its vehicles will be manufactured by a unit of the state-owned automaker BAIC Group in a Beijing factory with an annual capacity of 200,000 vehicles.
The smartphone giant has pledged to invest $10 billion in autos over the next 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.