Tesla China sales will get under more pressure in H2

Xiaomi released its second car, the SUV YU7, to compete with the Tesla Model Y. Most of the specs and features were officially unveiled today, so we can compare it to the US automaker’s SUV.

Model Y is Tesla’s stronghold in China. Last year, Tesla sold 480,309 units of Model Y in China, which accounts for 74.6 % of its sales. The mid-size SUV managed to sell quite well even under pressure from many Chinese EV makers, such as Xpeng G6, Deepal S7, Zeekr 7X, and Onvo L60.

It definitely wasn’t rainbows and butterflies for Model Y as the 2024 performance, with 5.2% year-on-year growth, was far from the 44.7% YoY growth in 2023 or 85.6% YoY growth in 2022. But given the circumstances, it was surprising how well it stood its ground.

However, the January facelift, which brought little newness aside from the exterior design, disappointed many, especially in the absence of an 800V charging. Together with the retooling of the Shanghai factory, it resulted in a 19.6% drop in Model Y sales in 2025 so far (January-April). Tesla was most likely expecting sales of the updated model to catch up in the year’s second half, but Lei Jun, Xiaomi CEO, seems he doesn’t think so.

During today’s unveiling conference, Lei Jun didn’t hide his intention to eat Tesla’s lunch. Jun openly compared YU7 with Model Y, highlighting specs where YU7 surpasses Model Y and assuring YU7 is way more competitive.

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One of the main points was range and charging speed. Jun claimed that thanks to the 800 V platform, YU7 can add 620 km in 15 minutes of charging. In comparison, Model Y takes 27 minutes to go from 10% to 80% SoC, the Xiaomi CEO added.

Xiaomi YU7 comes in three trims – Standard, Pro and Max (same as the SU7 sedan trims). We compared the specs of YU7 Standard (RWD) with Model Y RWD, which are the competing trims and in the second table, we compared YU7 Pro (AWD) with Model Y Long Range (AWD). We also added the YU7 Max into the table, but with its 508 kW power, its competitor would be Model Y Performance, which doesn’t sell in China yet. Tesla sells only the 5-seater version of Model Y in China, and rumours say the 7-seater might come early next year.

YU7 has an 830 km range in the entry-level trim compared with Model Y’s 593 km. Thanks to the larger battery, which YU7 has, 96.3 kWh, and Model Y has 62.2 kWh. With a length of nearly 5 meters, YU7 is 202 mm longer than the American SUV. On the other hand, Model Y is 394 kg lighter than YU7. The YU7 has a larger frunk with a 141-litre capacity. Acceleration is the same, about 5.9 seconds to go from 0 to 100 km/h.

For the higher trim, YU7 Pro vs Model Y Long range, the Chinese EV also surpasses its US counterpart in most of the specs, except for drag coefficient, curb weight and computing power.

There are too many good options for Chinese buyers aiming at mid-size electric SUVs, and YU7 might be the last nail in the Model Y’s coffin in China. As Xiaomi will have production delays as usual, and it will take some time to ramp up production, Tesla might have a chance to fight back in H2 2025. However, when the plant reaches its maximum capacity and more Chinese electric SUVs launch, 2026 might be a showdown for Tesla in China, as the danger of YoY decline in sales is becoming more real than ever.

During the conference, Lei confirmed that Xiaomi has delivered over 258,000 units of the SU7 sedan since it launched last April. The sales ratio between SUVs and sedans in China is about 1:3.