Chinese EV and smartphone maker Xiaomi on Thursday priced its new electric YU7 SUV from 253,500 yuan ($35,364), almost 4% below Tesla's Model Y, stepping up the challenge to the U.S. firm in the world's largest auto market.
The YU7's base model costs 10,000 yuan less than the starting price of Tesla’s Model Y in China, with the more premium models YU7 Pro and YU7 Max priced at 279,900 and 329,900 yuan, respectively.
Xiaomi started taking orders for all three models on Thursday night, with orders hitting 200,000 in three minutes after the sale started at 10 p.m. (2 p.m. GMT)
The Model Y, which was China's best-selling SUV in May, starts at 263,500 yuan in China.
Xiaomi said it will partner with BYD, GAC Toyota and Zhengzhou Nissan to build an ecosystem connecting humans, homes and cars.
Xiaomi's CEO and founder Lei Jun has said he wants the YU7 to challenge the Model Y and analysts say it has the potential to succeed. Other rivals include Zeekr's 7X and Li Auto's L6.
"The YU7 will serve as an early test of whether Xiaomi can broaden its appeal beyond early adopters and tech enthusiasts to become a serious player in the mass-market EV segment," said Rosalie Chen, senior analyst at Third Bridge.
The YU7 has a driving range of up to 835 kilometers (519 miles) per charge, compared with up to 719 kilometers for the redesigned Model Y that was launched in January.
The YU7 is Xiaomi's second car since the Beijing-based firm entered the auto sector last year with its sporty electric SU7 sedan, which drew styling cues from Porsche and was priced below Tesla's Model 3. Since December, the SU7 has outsold Tesla's Model 3 in China on a monthly basis.
The SU7's success expedites the company's EV bid despite intense competition in China's auto market.
In March, Xiaomi raised its target for EV deliveries this year to 350,000 from earlier guidance of 300,000.
The company has secured a plot of land in Beijing close to its existing car factory for 635 million yuan, which it plans to use for a smart connected car and components project.
Lei said in June that he expected Xiaomi's auto business to become profitable in the second half of the year.
