Shares of Xiaomi rose 7.5% in Hong Kong on Tuesday after it announced it would start selling its long-awaited electric cars at the end of March.
The Beijing-based electronics company, best known for its smartphones, has bet billions of dollars on entering China’s highly competitive electric vehicle market, which is led by Tesla and BYD. The SU7 series will go on sale in 29 cities starting March 28, the company said in a post on Weibo, without disclosing the price.
Billionaire co-founder Lei Jun is leading the charge into the auto industry, making it his primary focus after turning the company’s smartphone business into one of the world’s largest. Lei, who is also an active venture capitalist, has described the electric car venture as his last bet in entrepreneurship.
Tough market
Xiaomi has teamed up with state-owned Beijing Automotive Group to build the electric vehicles, aiming to avoid the long wait required to obtain a manufacturing permit from local regulators. The SUV7 enters a tough market as government subsidies for electric vehicles, which can cost up to 60,000 yuan ($8,400), expire in 2022. The company must compete for attention in a field that now includes hundreds of models from dozens of brands.
Xiaomi explained that the name SU7 refers to the word Speed Ultra, as the cars can accelerate from 0 to 100 kilometers per hour in 2.78 seconds.
