Xiaomi, a well-known maker of smart consumer electronics in China, is venturing into the country's competitive electric car market with the launch of the SU7, a sporty four-door sedan. The tech company, founded in 2010, is set to begin taking orders for the new electric vehicle following a launch event in Beijing with founder Lei Jun. Analysts predict that the SU7 will be priced around 300,000 yuan ($40,000).

The Chinese electric vehicle market has been flourishing, thanks to government subsidies, making China the largest market for electric vehicles globally. With a plethora of new manufacturers entering the market, competition is fierce. While most sales have been domestic, Chinese automakers are now eyeing overseas markets with more affordable models, posing a potential challenge to European, Japanese, and American auto giants.

Lei Jun is confident about Xiaomi's entry into the automotive industry, expressing ambitions for the company to become one of the top five automakers worldwide in the next 15 to 20 years. Xiaomi plans to leverage its technology expertise to create a seamless "Human x Car x Home" ecosystem, connecting its cars with its existing line of smartphones, smart TVs, and other devices.

However, as a newcomer to the automotive sector, Xiaomi faces challenges in adapting to the competitive landscape. Tu Le, founder of Sino Auto Insights consultancy, believes that Xiaomi's success in the EV market will depend on its ability to learn and adjust to market demands. CreditSights, a financial research firm, anticipates that Xiaomi's EV division may face losses in the first two years due to high marketing costs.

Chinese automakers expanding abroad also face political obstacles, with the EU investigating Chinese subsidies that could provide an unfair advantage to Chinese-made EVs. In response, China filed a complaint with the World Trade Organization, alleging discrimination in U.S. subsidies for electric vehicles. President Joe Biden has expressed concerns about China's dominance in the auto market and potential risks to national security.

Despite these challenges, Xiaomi remains determined to make a mark in the electric car industry. With its innovative approach and commitment to technological advancement, the company aims to carve out a space for itself in the evolving automotive landscape.