Lei Jun dares to sell cars for 800,000 now

Author | Chai Xuchen, Wang Xiaojun

Having crossed into the automotive industry for less than a year, Lei Jun's ambition has surprisingly surged into the "million" track.

On October 29, at Xiaomi's new product launch event, the mysterious SU7 Ultra version was finally unveiled. As Xiaomi's performance and technology flagship, this car naturally became Xiaomi's most expensive product.

However, after Lei Jun showcased lap times and highlighted luxurious features... the pre-sale price of 814,900 yuan still caused a stir at the event, with some questioning whether Xiaomi was being too arrogant. But only Lei Jun knows that the SU7 Ultra is the key stepping stone for Xiaomi Auto to reach the next stage.

After 6 months on the market, the monthly delivery volume of the Xiaomi SU7 has already surpassed 20,000 units, placing it in the same league as Nio, ZEEKR, and others.

The rapid achievement of such results is partly due to Lei Jun's personal charisma and Xiaomi's decades of reputation in the consumer electronics field. However, as the traffic windfall passes and consumers return to rationality, Xiaomi will also need to face the scrutiny experienced by other new forces. Only strong product capabilities will be the key for it to avoid being swept away by competitive tides and ultimately establish itself.

The Ultra mass production version has thus arrived, with Xiaomi "showing its muscles" to demonstrate its confidence as a latecomer. In the future, these high-end technologies equipped in the "race car" are also expected to be applied to other Xiaomi models, helping it accelerate market capture. This is an important step for Xiaomi Auto in its race towards becoming a giant.

But back to reality, the current market above 800,000 yuan remains a "forbidden zone" for domestic brands. Even with challengers like Aito and Haobo entering the fray, and Nio, Huawei, and ZEEKR following suit, no one has yet successfully established a foothold. For challengers, the high-end performance luxury market is a tempting yet thorny "danger zone."

Whether the SU7 Ultra can solidly enter the market and secure its place is crucial for Xiaomi Auto's future in the industry. There are still many hurdles for Lei Jun to overcome.

Explosive Orders

A year ago, ZEEKR launched the 769,000 yuan "performance monster" 001FR, claiming that "competitors won't be able to produce it within five years." Now, Lei Jun has come in with a "king bomb."

On October 29, the long-awaited Xiaomi SU7 Ultra mass production version finally opened for pre-sale. The price of 814,900 yuan made many netizens sigh, "If we don't work harder, we'll only be able to drive BBA."

This pricing seems quite meaningful. When the Xiaomi SU7 was launched, its direct competitor was the Tesla Model 3, but the benchmark products presented in the PPT were the "million-level" Porsche Taycan and Tesla Model S. The pre-sale price of 814,900 yuan for the Xiaomi SU7 Ultra mass production version completely overlaps with that of the Model S Plaid performance versionLei Jun candidly stated, "The track package that costs extra for the Model S Plaid will be standard on the Xiaomi SU7 Ultra."

Although Lei Jun had long said, "This car is a bit expensive," the enthusiasm of Xiaomi fans was directly reflected in the orders. Within 10 minutes of the pre-sale opening, the order quantity for the mass-produced version of the Xiaomi SU7 Ultra reached 3,680 units. In comparison, the Porsche Taycan sold only about 4,100 units in China last year.

As a four-door sports car priced at 800,000 yuan, the mass-produced version of the Xiaomi SU7 Ultra undoubtedly achieved a strong start.

Some netizens who were deterred by the price chose to buy model cars to satisfy their emotional value. However, the Xiaomi SU7 Ultra version 1:18 alloy model car, priced at 599 yuan to 999 yuan, sold out that evening. In response to complaints from netizens who couldn't grab one, Lei Jun replied in the comments, "Currently, the model cars are mostly handmade, and the production capacity is very low."

What excites Xiaomi fans is Lei Jun's promise regarding the performance of the mass-produced car.

Xiaomi introduced that this car is positioned as a peak performance technology sedan, and the mass-produced version will have the same power system as the prototype, with a 0-100 km/h acceleration of 1.98 seconds and a designed top speed of 350 km/h. Lei Jun described the mass-produced version of the Xiaomi SU7 Ultra as "a four-door racing car that can legally be driven on the road."

To showcase the car's speed, Lei Jun and his team transported the test car to the Nürburgring in June for tuning on the track. Initially scheduled for October 9-10, the testing was unsuccessful due to weather conditions, but ultimately, just before the pre-sale on October 28, the prototype of the Xiaomi SU7 Ultra managed to achieve a lap time of 6 minutes 46 seconds 874, setting a new lap record for four-door cars on that track.

"Nürburgring is a sacred place in the hearts of every automotive engineer; almost all high-performance cars in the world have been refined on this track," said Hu Zhengnan, a senior advisor for Xiaomi Automotive. The fate of this "new wave" is quietly being rewritten.

After the launch of the Xiaomi SU7, it was nicknamed "Porsche Mi" due to its resemblance to Porsche. Six months later, the narrative comparing Porsche and Xiaomi seems to have diverged significantly. The latter's price has continued to drop, even dipping below 400,000 yuan at one point, while Xiaomi has chosen to ride the wave, directly reaching 800,000 yuan.

Whether launching a "money-making pricing" high-end version first and then introducing a more affordable model for the masses, or starting with a volume model and gradually moving upmarket with a high-end version to showcase strength, companies like Tesla and BYD have followed this path for years. Xiaomi has launched two models in less than a year, which is indeed remarkable.

Moreover, the Xiaomi SU7 took only 6 months from its official release to surpass a monthly delivery milestone of 20,000 units, setting a new industry speed record.

However, Lei Jun still needs to answer the industry's "soul-searching question": beyond the founder's brilliance and marketing hype, where will Xiaomi Automotive's future lead? When the enthusiasm of "Mi fans" eventually wanes, can Xiaomi still establish a foothold in this century-old industry?Perhaps the Xiaomi SU7 Ultra, which is not aimed at high volume sales, is meant to answer this question for Lei Jun.

Charge Forward

Lei Jun is good at storytelling, and the Nürburgring, as the birthplace of nearly a century of performance cars, is the best story sample. After all, the yearning for speed and passion is always etched in people's DNA.

Without the lap time support of the Ultra, whether the final production version can sell well remains uncertain. Fortunately, the day before the launch event, the Ultra prototype claimed the title of "the fastest four-door production car on the planet," leaving track stars like the Porsche Taycan Turbo GT and Tesla Model S Plaid in the dust. Lei Jun exclaimed, "This is my Dream Car."

From learning to drift, obtaining racing licenses, to clocking laps at the Nürburgring... Lei Jun understands what Xiaomi fans want. However, since he announced the challenge at the Nürburgring, there have been constant doubts that he is merely seeking attention.

As a newcomer in the automotive industry, it is not surprising that public opinion has raised questions.

Industry insiders believe that the Xiaomi SU7, which had a successful debut, possesses good mechanical quality and intelligent enhancements, but its key to success cannot be separated from the halo effect of Xiaomi and Lei Jun himself. Therefore, shortly after the Xiaomi SU7 was delivered, fans were eager to take it to the track for testing, wanting to ascertain the strength of Xiaomi's automotive ambitions.

Indeed, the endorsement of "Lei Busi" is one of the deep-seated "selling points" tied to Xiaomi's cars and serves as its ticket into the automotive market. However, to truly establish a foothold in the industry, relying on stories and a halo is far from sufficient, especially since Lei Jun has set his sights on the "million" level, a peak that previous domestic brands have never successfully rooted themselves in.

Looking up to U8/U9 and Haobo SSR, which were only briefly shining stars, their sales have already significantly adjusted; the once comparable HiPhi to Porsche and Rolls-Royce has been declared bankrupt; Aito, ZEEKR, and Nio are still on their climbing journey. Yet, Xiaomi, which has always relied on "cost performance" and lacks the genes of luxury performance cars, has emerged halfway through. How will it prove its strength?

Xiaomi Auto needs to demonstrate that it has technology to showcase. Betting all its "black technology" on a performance car and successfully challenging the Nürburgring not only showcases its capabilities in power and overall vehicle tuning but also hopes to enhance brand premium, aiding the high-end process of Xiaomi Auto and even Xiaomi Group.

Behind this is Xiaomi's desire to establish a solid foothold.

For those familiar with new forces, the tuning experience, power system, and self-developed technology of the SU7 Ultra could potentially be "delegated" to Xiaomi's subsequent models, entering the market, where Xiaomi will have a stronger appeal in the 200,000-300,000 yuan segment.

It can be said that the SU7 Ultra is a rehearsal for future Xiaomi models. Lei Jun also emphasized that challenging the Nürburgring is a way to test their car-making technology on the track, leading to the production of higher quality mass-produced cars.

However, creating this "model room" for the Ultra is not so easy, and bringing it to market is even more challengingLei Jun admitted that the success of the SU7 Ultral prototype is just the first step, as the prototype only needs to focus on performance to achieve the fastest results without considering cost. However, this original car, which Lei Jun described as "too expensive to afford," still has a long way to go before mass production and entering the consumer market.

"The real challenge ahead is to continue battling at the Nürburgring with the Ultra mass-produced car. If the mass-produced car can also run within 7 minutes, then it can be considered a true surpassing of Porsche and Tesla," Lei Jun said. "The road ahead for Xiaomi is very long, and we need to move forward with a sense of reverence."

However, at this moment, Lei Jun has chosen to go all in, betting all his reputation and achievements on car manufacturing, determined to match the scale of industry giants. The SU7 Ultra, which plays a pivotal role, is Lei Jun's ticket to securing a position in the endgame, and its success or failure will determine the fate of Xiaomi's automotive venture.

At this moment, Lei Jun's direction and confidence are incredibly firm. However, the battle for Xiaomi Auto to seize the "Shangganling" has just begun