Xiaomi, the Chinese smartphone and consumer electronics company, launched its new SUV in Beijing on Thursday, as the smartphone and consumer electronics company prepares to compete with Tesla in the world’s largest auto market.
Xiaomi has launched the YU7 in 13 of its showrooms in the Chinese capital, Beijing, and will begin taking orders in July. The company is striving to replicate the success of its SU7 sports sedan, launched last year and outselling the Tesla Model 3 every month since December.
According to analysts, the YU7 could pose a significant threat to Tesla’s best-selling Model Y, but its launch comes at a time when Xiaomi, a relative newcomer to the highly competitive Chinese electric vehicle market, is experiencing a decline in new electric vehicle orders following a series of controversies.
Chinese authorities are investigating a fatal highway collision in late March involving an SU7 in driver assistance mode. Xiaomi apologized for “insufficiently clear marketing” after customer complaints about false advertising.
China has banned the use of the terms “smart driving” and “autonomous driving” in car advertisements, categorizing such language as “misleading advertising,” which misleads consumers into believing the car can drive itself and determine road conditions.
According to the feedback from the showrooms of Xiaomi’s new car, visitors were most impressed by the car’s attractive design and distinctive color. Furthermore, the fact that Xiaomi cars are connected to the company’s personal devices and smart home products makes Chinese consumers feel that Xiaomi understands their needs and desires better than its foreign counterparts.
Chinese consumers have long favored Western brands, but the rapid advancement of China’s electric vehicle sector is pushing consumers to focus more on products than brands.
Reuters quoted Tom van Deelen, managing partner at German management consultancy Greenkern in Beijing, as saying he disliked some of the YU7’s smart features, which he described as “unnecessary.” However, he said the YU7 is a strong competitor to the Model Y.
He pointed to the “advantage of the physical ecosystem in the showroom, where there is a dedicated area for accessories that are only suitable for Xiaomi cars,” as well as its competitive price.
