Xiaomi faces customer backlash as YU7 SUV delivery times stretch to over a year

Chinese tech giant Xiaomi is facing mounting criticism from customers after it revealed that delivery times for its newly launched YU7 electric SUV could stretch to more than a year. The news has sparked a wave of complaints from buyers, many of whom claim they were not informed of the lengthy wait before placing their orders.

Xiaomi, which entered the electric vehicle (EV) market last year with its SU7 sedan, said it received approximately 240,000 orders for the YU7 within the first 18 hours of its release on Thursday night. However, only a limited number of units were reportedly available for immediate dispatch.

By Tuesday, users of the official Xiaomi app were being shown estimated waiting periods ranging between 38 and 60 weeks, according to checks carried out byReuters. This delay has triggered discontent among early buyers, with over 400 complaints filed on Sina’s Black Cat consumer platform since Friday. Many purchasers allege they were unaware of the delivery timeline until after paying a non-refundable deposit of 5,000 yuan (around $698).

Customers have also voiced concerns over potential additional costs, as China’s tax exemption for electric vehicles is set to expire by the end of this year. A delayed delivery could mean some buyers lose out on the financial benefit.

The company has not yet responded publicly to the backlash. However, Xiaomi’s founder and CEO, Lei Jun, announced via social media platform Weibo, where he commands an audience of 26.8 million followers, that he plans to address consumer concerns in a livestream on Wednesday.

Notably, the YU7, Xiaomi’s second EV model, enters a competitive market priced at 253,500 yuan ($35,360), undercutting Tesla’s best-selling Model Y by nearly four per cent. The company has openly declared its ambition to challenge Tesla's dominance in China’s SUV segment.

Xiaomi's debut model, the SU7, made headlines upon launch in March last year and has since outsold Tesla’s Model 3 on a monthly basis in China since December. Nevertheless, the company has recently been navigating reputational challenges, including criticism over delivery transparency and a fatal SU7 crash in March that drew intense scrutiny.

To meet growing demand, Xiaomi has been scaling up operations at its production facility in Beijing. Output increased from 4,000 vehicles in March 2024 to 28,000 in May, with plans underway to build additional factories on two adjacent plots.

(With inputs from Reuters)