Tesla Rival Xiaomi Slashes Luxury EV Price By 35% To Challenge Model S, Porsche In China

Chinese tech giant Xiaomi Corp. XIACY cut the price of its luxury electric sedan SU7 Ultra by 35% to 529,900 yuan ($72,932) from the initially promoted 814,900 yuan ($111,842), strengthening its challenge against premium automakers like Tesla Inc. TSLA and Porsche in China’s competitive EV market.

What Happened: CEO Lei Jun announced the significant price reduction during Thursday’s official launch event in Beijing, explaining that potential buyers who currently drive the BMW 5 series, Audi A6, and Mercedes-Benz E-class vehicles found the original price point prohibitive, Reuters reported.

“Our mission is that we should let more people who like us afford luxury cars,” Lei stated. The strategy appears effective, with Xiaomi reporting 6,900 orders within just 10 minutes after the announcement.

Xiaomi entered China’s crowded EV market last year with its regular SU7 model, priced under $30,000, which has already outpaced Tesla’s Model 3 in sales since the fourth quarter of 2024. The SU7 Ultra was initially positioned to compete directly with Tesla’s Model S Plaid, which sells for 814,900 yuan ($111,842) in China.

Why It Matters: The Ultra model features premium materials, enhanced seating, and upgraded audio systems compared to standard SU7 versions. Early buyers placing orders before March-end will receive perks including lifetime free access to Xiaomi’s HAD intelligent driving system, normally priced at 26,000 yuan.

Lei also took aim at Tesla’s recent autopilot software update in China, which “has gone viral over the past two days, but still needs users to pay more than 60,000 yuan,” highlighting competitive tensions in the autonomous driving space.

This aggressive pricing move comes as Chinese tech stocks, including Xiaomi, rallied last week on anticipated monetary easing from Beijing. However, Xiaomi shares tanked on Friday by 2.73% to 51.65 HKD ($6.64) in recent Hong Kong trading.

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