EV newcomer Xiaomi is already developing a second model to compete with the Tesla Model Y

Just over a month after launching its first-ever EV, smartphone specialist Xiaomi is reportedly well into the development of an encore model. Per the report, Xiaomi Automobile has already been benchmarking an all Xiaomi SUV model against the Tesla Model Y and may be competing against it in the market sooner than you’d think.

It’s been just over three years since Chinese electronics manufacturer Xiaomi announced a new EV-focused arm called Xiaomi Automobile. During that time, we followed much of the smartphone developer’s transition into automotive manufacturing, which ended up progressing faster than even it had anticipated.

Those efforts culminated in Xiaomi’s first model – the SU7 sedan, which gained some serious clout when it debuted this spring, garnering over 50,000 orders in the first 27 minutes of going on sale in China.

With its SU7 order books now sitting at over 100,000 units, Xiaomi has begun wielding its production expertise to ramp up its output to meet demand. In the first 32 days of SU7 production, the new automaker reported that it had already built 10,000 units en route to 90,000 more targeted before the end of the year.

While the SU7 continues to make its mark on the EV market, Xiaomi is reportedly already deep into developing a second model to compete against the global EV market’s current best-seller, the Tesla Model Y.

Xiaomi gets rolling in China, sets its sights on Tesla

Per a report by Bloomberg, Xiaomi’s second all-electric model will be a compact SUV similar to the ever-popular Tesla Model Y. A person familiar with the matter said that Xiaomi was already benchmarking the Model Y during the incoming SUV’s development, setting the stage for s showdown between the smartphone specialist and the American automaker in China.

When Xiaomi began brainstorming its new EV arm three years ago, an SUV was part of the initial plans, but ultimately, it decided to focus on the SU7 sedan first, which remains its priority at the moment.

That being said, the Tesla Model Y competitor is already in the works, and Xiaomi is reportedly targeting a start of production by late 2025 once the second phase of its EV production facility in Yizhuang, Beijing, is completed.

That facility is expected to reach an annual production capacity of 300,000 units annually. Phase one is expected to be completed next month, offering Xiaomi a capacity of about 150,000 EVs annually. Phase two is scheduled to begin expansion sometime in 2024.

According to Chinese media outlet 36kr, Xiaomi also plans to launch a third, lower-priced EV model after the SU7 sedan and SUV to compete against Tesla, but the automaker has not confirmed those plans.