Tesla Inc. TSLA continues to see sales pressure for its electric vehicles in the Chinese market. A new report indicates that the introduction of a new vehicle from a growing rival in the region could significantly impact the dominance of the Model Y.
What Happened: Smartphone company Xiaomi XIACF is pushing deeper into the electric vehicle market, with recent launches of the SU7 and YU7, which compete against the Model 3 and Model Y from Tesla, respectively.
Production increases have taken the Xiaomi YU7 to over 3,000 units per week and they are quickly selling out to the thousands on a waitlist that currently has an estimated wait time of more than one year.
A chart shared by Electrek highlights the sales growth momentum of the YU7 compared to the Tesla Model Y. Here’s a look at the sales of the two models in recent weeks for the Chinese market.
| Week of 2025 | Tesla Model Y (sales units in ,000s) | Xiaomi YU7 (sales units in ,000s) |
| Week 27 | 3.6 | 0.3 |
| Week 28 | 9.4 | 0.9 |
| Week 29 | 7.5 | 1.6 |
| Week 30 | 7.9 | 1.6 |
| Week 31 | 8.9 | 2.3 |
| Week 32 | 9.3 | 2.5 |
| Week 33 | 8.8 | 3.6 |
| Week 34 | 8.3 | 3.9 |
The chart shows the sales data since the launch of the YU7 earlier this year. Except for one week, the YU7 has seen sales growth each week, while Model Y sales have been less consistent and have declined in recent weeks.
The growth of the YU7 against the Model Y comes as the SU7, Xiaomi’s first electric vehicle, has been outselling the Model 3 this year. Over the past 12 weeks, the SU7 has outsold the Model 3 in all but one.
The chart of the YU7, which comes with Xiaomi still facing limitations due to production, shows that the Model Y could be in trouble. The vehicle launched in June and, based on the chart, could outsell the Model Y monthly by the end of the year.
The YU7 has over 200,000 preorders. The strong demand and long wait times even prompted Xiaomi CEO Lei Jun to tell consumers they might want to purchase from his competitors if they want a new electric vehicle promptly.
“If you need to buy a car quickly, other China-produced new energy vehicles are pretty good,” Lei said on social media.
Read Also: Tesla Q2 Earnings Highlights: Revenue And Earnings Fall Short; New Models Still Set For 2025–2026
Why It’s Important: This latest report addresses Tesla’s concerns related to the Chinese market. Tesla’s sales are down 6% year-to-date in China, according to the report.
In the second quarter, a report said Tesla’s China sales were down 4.3% quarter-over-quarter and down 11.7% year-over-year.
The second quarter results could be even worse for China as they came with the Model Y refresh, record discounts and 0% financing.
China is one of the largest electric vehicle markets in the world and a major source of deliveries for Tesla. While Tesla faces competition from other companies in the region, recent data suggest that it may be struggling even more than initially feared.
TSLA Price Action: Tesla stock is down 0.3% to $350.50 on Wednesday, versus a 52-week trading range of $202.59 to $488.54. Tesla stock is down 7.6% year-to-date in 2025.
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