The global electric vehicle (EV) market was shaken this summer as Xiaomi announced a record-breaking 289,000 pre-orders in just one hour for its new luxury SUV model. This achievement, unprecedented for a Chinese technology company, stands in stark contrast to Apple’s well-publicized retreat from the car industry. The remarkable success of Xiaomi—particularly when set against Apple’s failure—highlights fundamental differences in vision, strategy, and execution, and raises new questions about the future of global automotive competition.

The Electric Race: Xiaomi’s Swift Ascent

In late June 2025, Xiaomi launched its high-performance YU7 SUV at a grand event in Beijing, setting a new benchmark for instant market success. Founder Lei Jun openly referenced Apple’s exit from car development, noting that Xiaomi’s new vehicles would seamlessly sync with iPhones—subtly signaling to Apple users disappointed by the end of “Project Titan.” Within an hour, over 289,000 pre-orders were placed for the YU7, far surpassing even the launch of the SU7 sedan in March 2024.

This extraordinary achievement is not just about numbers. It reflects a broader transformation in the Chinese and global auto industries, where traditional automakers now find themselves challenged by a new, innovative player able to move quickly, leverage a devoted fan base, and deliver products that blend high technology with mass appeal.

Apple’s Failure Versus Xiaomi’s Pragmatic Boldness

Apple’s car project, codenamed “Titan,” officially ended last year after more than a decade of effort and an investment of over $10 billion. Apple’s vision was ambitious: not just an electric car, but a fully autonomous, Level 5 self-driving vehicle. This lofty goal led to persistent delays, shifting strategies, and ultimately a decision to abandon the field entirely.

Xiaomi, on the other hand, took a far more pragmatic and grounded approach. Lei Jun and his team learned from the Chinese auto industry’s best practices, recruited top talent from giants like Geely, GM, SAIC, and Magna, and focused on efficient, targeted, and cost-effective product development. While Apple tried to reinvent the entire automotive experience, Xiaomi blended proven technology principles from the smartphone and IoT world with hard-won insights from traditional automotive manufacturing.

Quantitative Analysis: Market, Orders, and Competitive Standing

By 2025, less than a year after its debut in auto manufacturing, Xiaomi had already set order volumes usually reserved for industry titans. The company quickly raised its production target to 350,000 vehicles per year, up from 300,000 only months earlier, responding to overwhelming demand for the YU7. The entry price for the SU7 sedan is 215,900 yuan (about $30,100 USD), while the SUV starts at 253,500 yuan, placing both models in direct competition with Tesla’s bestsellers.

For comparison, BYD—the leading Chinese carmaker—sold over 4.3 million electric and hybrid vehicles last year, while Tesla delivered around 1.78 million worldwide. Xiaomi still has ground to cover, but given its current growth rate, the company is seen as a formidable contender poised for international expansion.

Leveraging Structural Advantages: China’s Ecosystem, Subsidies, and Supply Chains

A key factor in Xiaomi’s rapid success is its launch within China’s unique EV ecosystem. Backed by substantial government support, advanced charging infrastructure, and a diversified local supply chain, Xiaomi enjoyed a strong structural tailwind that Western companies like Apple lacked.

Between 2021 and 2024, Xiaomi invested over $1.6 billion in more than 100 companies across the EV supply chain, from batteries and chips to air suspensions and sensors. Unlike many new entrants relying on contract manufacturing, Xiaomi built its own factory, allowing for tighter quality control, greater innovation, and faster response to market trends. Strategic investments in suppliers such as Hesai (lidar), Zhejiang EV-Tech (chargers and inverters), and others ensured that critical components would be available and customized for Xiaomi’s vehicles.

Talent Acquisition and Product Innovation

Central to Xiaomi’s achievement is its success in attracting top talent from the global automotive sector. Engineers and executives from high-end brands and leading automakers, including former BMW designer Li Tianyuan, joined Xiaomi’s auto division. This infusion of expertise enabled the company to deliver advanced design, superior performance, and market-ready vehicles in record time.

Moreover, Xiaomi’s deep connection with its “Mi fans” base—loyal consumers who have followed the brand since its early days in smartphones and electronics—has been a powerful asset. This enthusiastic community not only drove initial sales but also provided invaluable feedback, helping Xiaomi build a strong, enduring brand, especially in China.

Global Strategy and Future Opportunities

While Xiaomi’s primary focus remains on the Chinese market for now, the company is already considering international expansion as early as 2027. Plans include setting up an R&D center in Munich and exploring initial launches in European markets such as Germany, Spain, and France. However, new tariffs in the EU, US, and Turkey will require Xiaomi to craft an adaptive global strategy and tailor its products for different regulatory and price environments—especially in the sub-$20,000 market where BYD reigns supreme.

Xiaomi’s first models have brought not just orders, but tangible financial impact: the company reported record earnings in the first quarter of 2025, and Lei Jun announced that the EV division is expected to become profitable in the second half of the year.

Constraints, Challenges, and Criticism

Despite this remarkable early success, Xiaomi faces significant challenges before it can claim global automotive leadership. Its current focus is on the upper-middle segment; the company does not yet offer vehicles below $20,000—a sector where BYD and Toyota dominate, and where sales volumes are highest. Xiaomi’s production scale remains “boutique” compared to the giants.

Furthermore, Xiaomi has faced criticism over the originality of its designs, with some industry voices calling the SU7’s styling derivative of Porsche. Safety concerns have also emerged, particularly following a fatal accident involving the SU7 earlier this year, which led to a temporary pullback in promotional activity. Nevertheless, Xiaomi’s strong brand loyalty and quick response to consumer concerns have helped it maintain sales momentum.

Strategic Takeaways and the Road Ahead

Xiaomi’s triumph where Apple failed stems from a focused, pragmatic strategy that leverages China’s local strengths, builds a vertically integrated supply chain, and invests deeply in both technology and people. The company’s approach highlights the shifting landscape of the global car industry: innovative electronics giants now have the means and motivation to disrupt legacy markets and redefine the rules of competition.

Looking forward, Xiaomi’s next major test will be its ability to expand internationally, maintain technological leadership, and continue to innovate on price, quality, and design. The company will need to navigate complex regulations, tariff barriers, and fierce competition—while also adapting to the varied preferences of global consumers. If Xiaomi can sustain its current pace of development, it may well become a leader in the next era of electric mobility.