Xiaomi Aims Big With New Electric Vehicle, Targets 20M Premium Users In China: 'Good Starting Point'

Xiaomi Corp XIACF is banking on its new electric vehicle (EV) to attract a potential 20 million premium users in China.

What Happened: The Chinese smartphone giant is set to unveil its new EV, the SU7, at the Mobile World Congress in Barcelona, which begins on Monday, reported CNBC on Sunday.

"We think it's a good starting point for us in the premium segment because we have already 20 million premium users in China based on the smartphone. I think the initial purchases will be very overlapped with the smartphone users." Xiaomi Group President Weibing Lu

Lu stated that the company is considering various price points, from entry-level to luxury, for the car, which has a development budget of $10 billion.

The SU7 was unveiled in China in December, but its price is yet to be announced. Lu hinted that the official release and domestic deliveries would commence shortly, potentially as early as the second quarter.

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Despite being known for its affordable products, Xiaomi is confident in its ability to sell the SU7, even in a market where established EV giants are reducing prices. The company’s strategy is based on ecosystem development and a smartphone “premiumization” strategy launched in 2020.

Why It Matters: Xiaomi is making significant strides in the EV market. In January, the company was reported to be entering the start of the production phase of the SU7, with plans to produce over 10,000 units by July.

China has been actively promoting its AI technology to compete with the U.S., with over 40 AI models approved for public use in the past six months, including those of Xiaomi.

However, Xiaomi’s entry into the EV market has not been without controversy. The company’s SU7 has drawn comparisons to Porsche’s models, with some accusing Xiaomi of design similarities. Despite this, Xiaomi is pushing forward with its EV ambitions, aiming to compete with industry frontrunners Tesla and Porsche.

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Xiaomi SU7. Photo Via Shutterstock