Xiaomi aims for YU7 to outsell Tesla Model Y

Xiaomi CEO Lei Jun has set a goal for the YU7 to outsell the Tesla Model Y, the best-selling electric premium SUV, in China.

It could very well happen, considering Xiaomi’s SU7 is now outselling Tesla’s Model 3.

Xiaomi is preparing to launch its second electric vehicle on Thursday.

It is a highly anticipated launch following the incredible and surprising success of its first model: SU7.

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The SU7’s success was not surprising from a demand standpoint; it is an incredibly attractive and capable vehicle for the price point, but it was surprising how quickly Xiaomi was able to ramp up production and deliver this vehicle.

Xiaomi is better known as a consumer electronics brand, often described as China’s Apple, and only started its automotive division in 2021. By early 2024, it started deliveries of the SU7 and within a year, delivered over 180,000 units. It was completely unprecedented in the industry.

Tesla’s Model 3 is the vehicle program that came the closest when production launched at Gigafactory Shanghai, but SU7 not only outpaced it – Xiaomi is now selling a lot more SU7s than Tesla is selling Model 3s in China.

There’s currently a wait time of more than 30 weeks between ordering and receiving a delivery of the SU7 in China.

Meanwhile, you can get a new Model 3 in China within a week, and Tesla is offering 0% financing to incentivize people to order.

As we have previously highlighted, it’s clear that the SU7 has had a significant impact on Tesla’s Model 3 sales in China.

Now, the Xiaomi YU7 is going against Tesla’s biggest seller: the Model Y.

The Model Y is the best-selling vehicle in the world and Xiaomi is not being shy about making it a target.

Ahead of the launch on Thursday, Xiaomi CEO Lei Jun has openly announced that the Beijing company aims to outsell Tesla’s best-selling model in China. He said:

Model Y is a global best-seller and has led the EV market for years. Many of you asked if XiaomiYU7 can surpass Model Y’s sales in China. We’ve set that as our goal, with deep respect for what Model Y has accomplished.

Tesla sells about twice as many Model Ys (about 80,000 units per quarter) in China as it does Model 3s, and it is a significant part of its global deliveries.

Outselling the Model Y is an ambitious goal for anyone.

Electrek’s Take

Normally, I would dismiss this as ridiculous ambition, since taking a new vehicle program from 0 to an annual rate of over 300,000 units per year, which is the current size of the Model Y program in China, is highly challenging.

However, considering what Xiaomi has achieved with SU7 in such a short period, I think it’s not impossible.

Having driven the YU7 ahead of its launch this week (a full first drive review will be published on launch day, the 26th), I believe it is certainly capable of outperforming the Model Y on a demand basis.

It offers a better range, a more intuitive UI, improved connectivity and interface, greater customizability, additional features, and, although subjective, it looks significantly better in my opinion.

It remains to be seen if Xiaomi can ramp up production to that level and on what timeline. That said, I also think it will take a significant chunk of Tesla’s Model Y demand in China and therefore, it end up outselling Tesla on a monthly basis sooner rather than later not only due to a production ramp from YU7 but also a drop in sales from Tesla.

For now, it is only in China, but Xiaomi has stated that it has global ambitions for its electric vehicles with expansions planned starting in 2027.