Lei Jun, the co-founder of Chinese smartphone giant Xiaomi, saw his net worth increase by $1.3 billion following the successful launch of the company’s first electric vehicle. The stock price of Xiaomi surged by 16% on the first day of trading after the Easter break, thanks to the positive response to the new energy vehicle. Initial orders for the SU7 electric sedan exceeded market expectations, with nearly 90,000 units sold within the first 24 hours of the launch event.
The pricing of the SU7 electric sedan, ranging from 215,900 yuan to 299,900 yuan, has been well received by consumers and industry experts. Lei Jun highlighted the competitive features of the vehicle during the launch, comparing it to Tesla’s Model 3 and even Porsche’s electric Taycan sportscar. While the exact sales target was not disclosed, analysts estimate that Xiaomi could deliver close to 100,000 units this year. The company is working with state-owned automaker BAIC Group to manufacture the vehicles and ramp up production.
Despite the initial success, analysts are cautious about the sustainability of Xiaomi’s EV venture in a highly competitive and oversaturated market. China’s EV sector is currently facing challenges such as overcapacity and aggressive price wars. Lei Jun acknowledged the impact of rivals like Tesla on the pricing of the SU7, which was lowered by $4,000 to attract consumers. He also mentioned that the EV business is not currently profitable but remains committed to building a “dream car” in the future.
As Lei Jun enters the EV market with Xiaomi’s electric vehicle, he faces uncertainties and risks in maintaining the initial enthusiasm among consumers. The success of the SU7 will depend on the feedback from consumers and the company’s ability to meet production targets. Despite the challenges, Lei has expressed his determination to make the EV business a success, describing it as his “last major start-up project.” Xiaomi’s collaboration with BAIC Group and gradual production increase indicate the company’s commitment to the electric vehicle industry.
In conclusion, Lei Jun’s $1.3 billion increase in net worth reflects the positive reception of Xiaomi’s first electric vehicle, the SU7, in the market. The pricing, features, and early order numbers show promise for the company’s entry into the EV sector. However, challenges such as competition, overcapacity, and pricing pressures loom over Xiaomi’s EV venture. Lei’s commitment to building a successful electric car and collaboration with established automakers indicate a long-term strategy for Xiaomi’s presence in the industry. The coming months will be crucial in determining the success of Xiaomi’s foray into the electric vehicle market.
