Xiaomi produces very affordable devices, but its CEO has just excluded low-priced electric vehicles from their plans.
Xiaomi is steering clear of the budget EV market
Xiaomi has gained a reputation for creating surprisingly affordable gadgets that often feel more premium than expected. However, this approach does not seem to apply to electric vehicles.
As reported by ITHome, Xiaomi's CEO, Lei Jun, mentioned during a livestream on April 17, regarding the company's SU7 endurance challenge, that Xiaomi will not produce vehicles priced below 100,000 Yuan, which is approximately $15,000. Lei clarified that for consumers to expect robust intelligent features, software, and overall performance from an electric car, it is challenging to drive down the costs to that level.
Nirave Gondhia / Digital Trends
Reasons why Xiaomi is abstaining from ultra-budget EVs
His statement was in response to a viewer's inquiry about the possibility of releasing a vehicle priced below 100,000 Yuan. He emphasized that developing smart EVs inherently increases production costs. This stance is notable within China's EV market, where numerous lower-priced models are available. That segment is fiercely competitive, dominated by vehicles focused primarily on affordability.
Given its current lineup of electric vehicles, the company's choice underscores a commitment to a more premium EV strategy, highlighting software, intelligent driving, and higher-end hardware.
Xiaomi prefers to absorb costs rather than engage in a price war
Xiaomi SU7 EV Xiaomi
During the livestream, Lei Jun also shared that the new-generation SU7 features over 100 updates, with material costs rising by nearly 20,000 Yuan. Nevertheless, Xiaomi only increased the retail price by 4,000 Yuan to maintain affordability for new buyers. The new SU7 model, priced at 219,900 Yuan, reportedly received 15,000 orders in just 34 minutes, indicating strong demand for their vehicles without entering the ultra-affordable market.
While Xiaomi continues to offer inexpensive gadgets, when it comes to automobiles, Lei Jun is clearly stating that the company aims to remain above the bargain segment.
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Xiaomi produces very affordable devices, but its CEO has just excluded low-priced electric vehicles from their plans.
Xiaomi's CEO Lei Jun has stated that the company does not intend to introduce extremely low-cost EVs priced under 100,000 yuan, explaining that the sophisticated technology needed for intelligent vehicles makes it challenging to reach that price level.