Xiaomi targets Tesla domination with new YU7 models

Chinese technology firm Xiaomi announced major updates to its crossover lineup. The brand officially launched a new, cheaper entry-level version of its electric SUV, the YU7. This fresh addition targets directly the market's current benchmark, the Tesla Model Y, by offering a lower price point and a better driving range.

Company executives openly shared their thoughts on the fierce competition in the modern EV market. CEO Lei Jun spoke candidly on stage, acknowledging that the initial pricing strategy for the vehicle fell short. When the SUV originally arrived on the market last June, the cost difference between the base version and Tesla's popular crossover sat at a narrow RMB 10,000 ($1,450). Management realized that this small financial advantage failed to convince enough buyers to switch away from Tesla.

To resolve this issue, the company completely restructured its product lineup. The previous base model has been renamed as the "Long Range Edition." Below it, a new "Standard Edition" steps into the entry-level spot with a starting price of RMB 233,500 ($32,400), widening the pricing gap between the base Xiaomi YU7 and the competing Tesla Model Y to a much more noticeable RMB 30,000 ($4,350).

The raw data behind this new entry-level trim shows how the company plans to secure a larger share of the market. The YU7 Standard Edition has a single, rear-mounted electric motor that generates 235 kW of power - 315 horsepower. The powertrain relies on a 73.0 kWh lithium LFP pack from supplier CATL, built on an advanced 752V electrical architecture. Dropping the secondary motor shed 254 lb of weight compared to the older base model, bringing the total curb weight down to 4,850 lb.

According to the China Light-Duty Vehicle Test Cycle (CLTC), the new entry-level variant covers 400 miles on a full battery. This is a 31 miles advantage over the base rear-wheel-drive Tesla Model Y, which holds an official rating of 368 miles. The Chinese EV has standard premium hardware usually reserved for pricier trims, such as an active smart chassis with dual-chamber air suspension, variable dampers, LiDAR, and a high-performance Nvidia computing platform. Owners also get highway navigation, city driving assist, and automated parking functions for life with no subscription fees.

The introduction of a cheaper variant arrives at an important moment for Xiaomi. Customer orders for the SUV began to cool down after the company cleared its initial backlog, allowing Tesla to recapture its sales lead. But high-volume models are not the only focus for the brand. Alongside the budget-oriented variant, the manufacturer introduced a performance version called the YU7 GT to showcase its technical expertise.

The track-oriented YU7 GT carries a starting price of RMB 389,900 ($54,100). Enthusiasts can upgrade the vehicle with a "GT Sports Kit" for a promotional price of RMB 14,000 ($2,100), and a top-tier version with every feature included costs RMB 429,900 ($63,200). The vehicle measures 197.4 inches in length, 79 inches in width, and 62.9 inches in height, maintaining a comfortable 118 inches wheelbase. This high-end variant has a proprietary electric motor capable of spinning up to 28,000 revolutions per minute. Paired with a front-mounted motor, the dual-motor system delivers a combined output of 738 kW, equivalent to 990 horsepower.

This immense power allows the heavy SUV to sprint from a standstill to 62 mph in 2.92 seconds, eventually reaching a maximum top speed of 186 mph. To prove its capabilities, the engineering team spent two years refining the chassis in Germany. The vehicle set a new record for production SUVs at the legendary Nürburgring Nordschleife circuit, completing a lap in 7 minutes and 22.755 seconds, which beat the previous luxury record-holder by 14 seconds.

The performance model uses an 897V architecture paired with a 101.7 kWh battery that can deliver 354 miles of range in just 15 minutes of ultra-fast charging. The total driving distance under the local standard reaches 438 miles. Inside, the cabin offers premium comfort with 2.3 square meters of Alcantara upholstery, massage functionality on all seats, acoustic insulation glass, and a 25-speaker audio system featuring active noise cancellation.

Xiaomi has delivered 232,000 units of the YU7 series since its initial debut and has surpassed 600,000 total EV shipments in less than two years of automotive operations. With the new pricing structure and high-performance flagship options, the company appears well-positioned to meet its ambitious target of delivering 550,000 EVs by the end of 2026.