Xiaomi has quickly established itself as an automaker to be reckoned with in China, and last year, it achieved something that would’ve seemed unlikely just a few years ago: its all-electric SU7 sedan outsold the Tesla Model 3. Data from the Chinese Passenger Car Association shows that in 2025, Xiaomi sold 258,164 SU7s, nearly double the roughly 135,000 units it moved in 2024.
This is not only a significant milestone for Xiaomi but also a blow to Tesla's dominance in the premium EV segment. The base version of the SU7 undercuts a comparable Model 3 by roughly 9 percent, giving it a clear pricing advantage.
Strong driving range and well-specced hardware round out the package, allowing the SU7 to compete in a segment Tesla once dominated. Chinese buyers have responded well not only to the SU7’s design inside and out but also to the technology it packs and the performance it delivers.
This success is a strong boost for Chinese carmakers, which are all trying to move up the value chain. With an updated SU7 on the horizon, Xiaomi is targeting 550,000 vehicles in 2026, which will also be the first full year of availability for the YU7 SUV.
The YU7 has already shown promising sales figures, with 33,662 units sold in a single month, even edging past the Tesla Model Y. This year is shaping up to be even bigger for Xiaomi, and its success could have significant implications for the EV market in China.
As the landscape continues to shift, it will be interesting to see how Tesla adapts to this new reality.
Xiaomi's rapid rise to prominence in the Chinese EV market is a testament to the brand's ability to innovate and deliver high-quality vehicles at competitive prices. As the market continues to evolve, it will be crucial for Tesla to reassess its strategy and find ways to regain its footing in the premium EV segment.
