The highly anticipated Xiaomi car finally made its official debut yesterday. In contrast to the previous launch event, which started strong but ended weak, this launch event was undoubtedly of great significance. The highlight was the announcement of the Xiaomi car's price range, from ¥215,900 to ¥299,900, considerably cheaper than the ¥300,000 to ¥400,000 many had expected.
Following the price announcement, Xiaomi car instantly topped the hot search lists on various platforms, with orders pouring in like rain. According to Xiaomi's official Weibo account, the number of large orders exceeded 10,000 within just 4 minutes, and surpassed 50,000 in less than half an hour. The limited edition SU7 founder's version, limited to 5,000 units, sold out instantly and will be officially delivered on April 3rd, a week later.
It's understood that Xiaomi's car production is still slightly insufficient, with a planned production capacity of only 4,000 units for March. However, two additional factories are currently under construction, and future production capacity is expected to increase continuously, with a total production expected to reach 70,000 units by 2024.
After a series of positive announcements, A-share stocks associated with Xiaomi cars started to rise collectively. There are 24 A-share stocks related to Xiaomi cars, with many hitting the upper limit and others also experiencing varying degrees of increase, resulting in an overall pleasing trend. Xiaomi Group also benefited from this, with its ADR soaring 12.13% by the close of the U.S. stock market on the 28th. The Hong Kong stock market was closed and could not reflect this immediately, but the trend is expected to be equally positive.
This surge reflects the mainstream expectation for Xiaomi cars on the market, which is generally positive. On one hand, the high brand recognition of Xiaomi means just announcing a Xiaomi car attracts significant attention. On the other hand, the pricing and configuration of Xiaomi cars meet investors' expectations for the brand's positioning, avoiding any potential misalignment that could arise from being priced too high or too low.
Since the announcement of its intent to build cars on March 30th, 2021, Xiaomi has been under tremendous pressure. The annual financial report of that year revealed that the company's car-making team had already expanded to over 1,000 people. By the end of last year, in an interview, Xiaomi's CEO disclosed that 3,400 people had been invested in the project, with research and development costs exceeding ¥10 billion.
In recent years, the electric vehicle craze has swept the globe, and Xiaomi's entry took many by surprise, given its traditional focus on the lower-end market instead of the high-end market, which often suggests lesser technology. However, Lei Jun stated that this was a determined move to enter the car manufacturing sector, even if it meant spending "ten times" the investment of other car companies.
This series of statements is undoubtedly a marketing strategy. Instead of praising its own performance or novel design, Xiaomi cars chose a different promotional strategy, and the facts have proved so far that this strategy has been successful. The technical conference three months ago attracted a lot of attention despite criticism for not announcing the price, and the official launch event has become a major online hotspot.
