The world’s best-selling electric vehicle has some competition. This month in China, Xiaomi unveiled its new YU7 electric SUV, positioned squarely against the Model Y with a lower price tag, competitive tech integrations, sleek, sporty design, and vibrant colors. Tesla‘s foothold at the top of the EV market is being seriously challenged — and consumers should pay attention.
«In China, the Model Y is already feeling the impact of Xiaomi’s YU7,» reported Electrek.
Xiaomi’s CEO Lei Jun is not mincing words when it comes to his goal for the company. Xiaomi «has set a goal for the YU7 to outsell the Tesla Model Y, the best-selling electric premium SUV, in China,» reported Electrek in June.
As YU7 orders skyrocket, Model Y purchases are falling. This mimics the performance of Xiaomi’s first EV, which is comparable to the Model 3 and has outsold its Tesla counterpart since its release.
For buyers, this competition could be a win. Xiaomi’s YU7 reportedly undercuts the Model Y on price while offering similar features. That kind of innovation forces Tesla to either drive down costs or significantly improve quality for customers worldwide. Greater choice at more competitive prices is exactly what EV shoppers want, especially in a time when affordability is a major barrier to widespread EV adoption.
Increased EV competition accelerates the transition away from gas-powered vehicles, cutting pollution faster. Increased production also requires more and more batteries and mineral mining, but the mining needed for the clean energy transition is a fraction of what is done annually for the oil industry.
Ultimately, Tesla’s battle with Xiaomi signals a changing EV landscape. Consumers are hungry for a growing market, and China offers one of the most competitive car markets in the world.
«There are numerous cars coming out of the woodwork there regularly,» wrote one commenter. «The YU7 will outsell the Model Y because they have more tech and are priced lower to undercut the competition. This is what all competitors in China have to deal with, not just Tesla. It will be interesting to see who is still selling cars in China in a few years.»
«For the last 5 years, the American automaker enjoyed some dominance in the Chinese market, but now local companies have caught up and Xiaomi is one of the best examples,» said Electrek.
«Well, that was to be expected. Tesla desperately needs a brand new model. The competition is moving very fast. And not just in China,» said another commenter.
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