According to Reuters on the 12th, Xiaomi announced on Weibo that it will sell its Speed Ultra 7 series at 59 stores in 29 cities in China starting on the 28th, Bloomberg and Reuters reported. Xiaomi has invested billions of dollars in the meantime to jump into the hot competition in the Chinese electric vehicle market led by Chinese company BYD and U.S. Tesla. However, the recent situation in the Chinese market is not good. Recently, BYD and Tesla are engaged in a fierce price war, and the rest of the companies are experiencing falling profits and slowing growth amid weakening demand. China’s electric vehicle sales rose 18% between January and February this year, which is not much different from last year’s overall growth rate of 21%. Apple, the same smartphone maker, recently canceled its long-running electric vehicle project. However, the stock market welcomed Xiaomi’s stock price. Shares of Xiaomi, which is listed in Hong Kong, are trading up about 10%. Analysts at Bloomberg Intelligence said Xiaomi’s sales could increase by up to 4% this year and serve as a long-term growth engine.It also said prices are critical amid fierce competition with its own companies, including BYD and Nio, and expected average prices to range from 220,000 to 260,000 yuan (about $40,000) and first-year sales to 30,000 to 50,000 units. Experts said Xiaomi’s shared operating system for cars with popular mobile phones and other electronic devices could appeal to the company’s existing customers. Xiaomi has chosen to partner with state-owned Beijing Automobile Group (BAIC) to avoid prolonged waiting times for manufacturing licenses from Chinese authorities, and will produce electric vehicles at BAIC’s Beijing plant. However, it is facing a difficult market situation as government subsidies of up to 60,000 yuan (about $9,000) for EV buyers have ended in 2022. Xiaomi first unveiled the SU7 in December last year, when the rear of the car was similar to that of a Porsche, drawing attention. The SU7 can travel up to 800 kilometers on a single charge and has a top speed of 265 kilometers per hour. Xiaomi explained that the zero-back, which reaches 100 kilometers per hour at rest, is 2.78 seconds.”Smart electric vehicles have a winner-take-all structure, so they cannot survive unless they are in the top five in world sales,” Xiaomi Chairman Lei Jun said in a media interview in January. “We entered an extremely competitive market, but we will eventually win.” Xiaomi has also declared that it will invest $10 billion in electric vehicles over 10 years.
SOPHIA KIM
US ASIA JOURNAL
