Xiaomi's New EV Orders in China Slump Over Fatal Crash, Bogus Ads

China’s Xiaomi is seeing a slump in new orders for its SU7 electric sedan, analysts said, as the company and its charismatic CEO grapple with a growing consumer backlash that now threatens its runaway sales success, Zhang Yan, Qiaoyi Li, and Brenda Goh reported for Reuters.

Nearly 400 owners of the SU7 Ultra have requested refunds after discovering the hood had no internal air ducts, contradicting previous claims by Xiaomi and its CEO Lei Jun. I Photo: Xiaomi

The sporty electric vehicle quickly became a hit among Chinese drivers after its launch in March last year.

By December, its sales had overtaken Tesla's Model 3 on a monthly basis in the world's largest auto market. But Xiaomi is now facing a wave of consumer concern that began last month following a fatal accident involving an SU7.

The accident, which remains under investigation, prompted widespread public discussion over the safety of the smart driving features offered by Xiaomi. Chinese regulators have since tightened oversight on the marketing and promotion of such features.

Orders for Xiaomi’s SU7 sedan plunged to around 36,000 units in April, down 55% month-over-month, Deutsche Bank AG wrote in a note.

“This trend extended into May,” auto analysts led by Bin Wang said.

Deliveries are also declining, the investment bank noted, with volumes falling sequentially over the past four weeks—from 7,200 in the third week of April to just 5,200 units in the second week of May, Bloomberg News also reported.

Xiaomi was pulled into further controversy last week after it apologized for what it called “unclear communication” following customer complaints.

SU7 owners said the company had falsely advertised the design of a dual-vent carbon fiber hood offered at an additional charge of 42,000 yuan ($5,826) on its SU7 Ultra.

Nearly 400 owners of the SU7 Ultra have requested refunds after discovering the hood had no internal air ducts, contradicting previous claims by Xiaomi and its CEO Lei Jun, according to Shanghai government-owned media The Paper.