Shares of China’s Xiaomi surged as much as 16 per cent on Tuesday (Apr 2) as the electronics maker’s sporty electric vehicle launched last week drew strong interest, though a brokerage forecast the firm would lose nearly US$10,000 per car this year.
Xiaomi added about US$7.6 billion to its market value as its shares touched their highest since January 2022 on the first day of trading after the firm on Thursday launched its debut car, which draws styling cues from Porsche.The Chinese company, which gets a majority of its US$37.5 billion revenue from being a smartphone vendor, now has a valuation of US$55.2 billion, higher than that of traditional US automakers General Motors and Ford, at US$52.4 billion and US$53.1 billion, respectively.
Xiaomi’s SU7 – short for Speed Ultra 7 – enters a crowded China EV market with an attention-grabbing price tag – under US$30,000 for the base model, cheaper than Tesla’s Model 3 in China.
While the world’s largest auto market is challenging for newcomers due to a cut-throat EV price war underway and slowing demand, analysts have said Xiaomi has deeper pockets than most EV startups and its smartphone expertise gives it an edge in smart dashboards – a feature prized by Chinese consumers.
Xiaomi has advised potential buyers of its sedan that they could face wait times of four to seven months, a sign of strong interest. It said on Friday that it had received 88,898 pre-orders for the car in the first 24 hours of sales.
The company has already produced 5,000 SU7 vehicles it dubbed the “founders edition” that it says come with additional accessories for early buyers.
Reuters
