Successful launch of bargain-priced Porsche Taycan-sized EV has boosted smartphone-maker Xiaomi’s value by $7.6 billion
2 hours ago
- Xiaomi stock surges by $7.6 billion.
- Tech company now valued at $55.2 billion, versus $52.4 bn for Ford.
- SU7 costs less than $30k but analysts say Xiaomi will lose $9,400 on each car.
Apple’s iCar project is dead, but over in China, Xiaomi execs must be delighted with their decision to branch out from smartphones to smart cars. The firm is now worth more than GM or Ford, thanks to an uplift provided by the arrival of its SU7 sedan.
Xiaomi’s SU7 is a Porsche Taycan-sized electric sedan that costs less than a Tesla Model 3. When the stock market opened after the car’s launch, the price of the company’s shares jumped, adding $7.6 billion to Xiaomi’s valuation. The Chinese tech giant is now worth $55.2 billion, Reuters reports, compared with $52.4 billion for Ford and $53.1 billion for GM. All three are still miles behind Tesla though, which is valued at an astronomical $549 billion.
The SU7 launches into a tough Chinese market, but it has distinctive styling – it looks like a Taycan wearing a McLaren 720S mask – and a competitive price on its side. A base SU7 costs less than $30,000, though buyers face a fairly long wait to get their hands on one. Xiaomi revealed last week that it had already received almost 90,000 pre-orders in the first 24 hours since sales started and that strong demand means would-be owners might not take delivery until more than seven months after placing an order.
Related: Xiaomi SU7 Flies Off Shelves, But Crashes, Delays And Complaints Sour Debut
Xiaomi’s aggressive pricing strategy might be a hit with patient EV buyers, but those wanting to cancel their order and receive a refund of their 5,000 yuan (around US$690) deposit report that they were struggling to get their money back due to accidentally locking their order in.
Other Chinese automakers have been forced to cut their prices to remain competitive. And it’s raised the eyebrows of industry analysts who predict that Xiaomi will lose around $9,400 on every car this year, based on a 60,000-unit run according to Reuters, but the tech giant has deeper pockets than any rivaling startup company.
Xiaomi has also had to deal with some unflattering publicity resulting from photos and video footage of several SU7 crashes generating thousands of views on social media. The accidents have led some commenters to wonder if the traction control system is up to the job of handling the flagship model’s 663 hp (495 kW / 673 PS).
