Xiaomi is known for building some surprisingly affordable devices that still feel a little more premium than they should. But this philosophy apparently doesn’t apply to electric cars.
According to ITHome, Xiaomi CEO Lei Jun said during a livestream for the company’s SU7 endurance challenge on April 17 that Xiaomi will not produce vehicles priced below 100,000 yuan. That equates to just under $15,000. Lei explained that when consumers expect strong smart features, software and overall performance from an electric car, it’s harder to reduce costs that much.
Why Xiaomi rules out ultra-budget electric vehicles
The comment came in response to a viewer’s question about whether Xiaomi plans to release a sub-100,000 yuan plan. He claims that making smart electric vehicles drives up costs. This is quite a standout in the Chinese electric vehicle market, which is known for its crowded, lower-priced models. The segment is highly competitive and full of models that prioritize cost efficiency.
Given the current range of electric vehicles, the company’s decision highlights its focus on a stronger premium electric vehicle positioning, emphasizing software, intelligent driving and higher-end hardware.
Xiaomi would rather absorb the costs than run to the bottom
During the live stream, Lei Jun also said that the new generation SU7 includes more than 100 upgrades, and the material cost alone has increased by nearly 20,000 yuan. Nevertheless, Xiaomi only increased the selling price by 4,000 yuan to keep the updated model in the budget of new buyers. And with the new 219,900 yuan SU7 model reportedly receiving 15,000 orders in just 34 minutes, the company is confident that demand for its cars will be strong without entering the ultra-affordable vehicle segment.
So Xiaomi may still be the company selling dirt cheap devices. But when it comes to cars, Lei Jun makes it clear that Xiaomi would rather stay above the bargain basement.
