Xiaomi has signalled a new phase in its auto ambitions: the SU7, the company's breakout electric sedan, is receiving its first mid-cycle refresh just 21 months after launch. The upgraded model is being previewed in early 2026 with a higher entry pre‑price (about RMB 229,900), marking not just a product update but a broader shift from rapid single‑model success toward a more sustained, systemised automotive strategy.
The SU7’s ascent was dramatic. Launched in March 2024, the model quickly became a phenomenon: huge pre‑orders on day one, more than 258,000 deliveries in 2025 alone and cumulative deliveries north of 360,000 by early 2026. Yet the trajectory since the peak has been uneven. Monthly volumes slipped from a high of nearly 29,300 to about 12,500 by November 2025, and internal competition from Xiaomi’s own YU7 SUV — launched in June 2025 with full‑range advanced driving and an 800V platform as standard — has eaten into SU7 demand.
Those market shifts have forced a tactical response. Xiaomi’s dealer network has quietly started clearing the outgoing SU7 inventory with steep discounts; low‑trim models are being offered with reductions of more than RMB 20,000, demo and lightly damaged cars have been priced down by RMB 50,000–60,000, and some exhibition vehicles are being sold for as little as RMB 170,000. The rapid move from scarcity to surplus reveals a familiar industrial tension: order transfers left an SU7 production line underused while the YU7 sat with a backlog, exposing limits to Xiaomi’s capacity flexibility.
The refresh itself is a recognition that the hardware baseline has shifted. Competitors in the 250,000–300,000 yuan bracket rushed to make higher‑level driver assistance, lidar and 800V fast‑charging standard. The earlier SU7 did not include lidar in its standard specification and offered only basic L2 assistance. Xiaomi’s next‑generation SU7 promises a catch‑up: lidar and 4D millimetre‑wave radar across the range, a 700 TOPS compute chip and a Pro variant with an extended WLTP‑style range figure cited at 902 km. Yet these upgrades come at a cost—explaining the modest price rise and Lei Jun’s public remark that Xiaomi cannot keep absorbing rising costs indefinitely.
Strategically, the timing of the facelift is important. Xiaomi is moving from proving a concept to embedding itself as a mainstream OEM: it delivered over 410,000 cars in 2025 and is targeting 550,000 in 2026, with plans to introduce more than five new models including new SU and YU derivatives and a range‑extended “Kunlun” series. The company is trading the outsized volatility of a single breakout model for the harder work of product‑line management, production allocation and refined go‑to‑market operations.
Broader market dynamics give the move added urgency. China’s EV market is shifting from rapid inflows of new customers to sharper competition over existing owners; buyers are more discerning about hardware and the level of driver assistance that comes standard. In that context, a one‑off hit is less valuable than a coherent portfolio that covers multiple price points and use cases. Xiaomi’s ecosystem advantages and brand recognition remain assets, but they will only offset technical and manufacturing shortfalls if execution improves.
The SU7 facelift will be a litmus test. If Xiaomi can synchronise product upgrades with production flexibility and channel discipline — limiting discounting while meeting demand for its newer models — it will have demonstrated the operational maturity to survive beyond the initial hype. If not, the company risks seeing its early gains erode as rival EV makers standardise higher levels of autonomous hardware and families gravitate to SUVs and crossovers that better match real‑world needs.