Xiaomi SU7 Overtakes Tesla Model 3 in China for the First Time
A major shift has taken place in China’s electric vehicle market. For the first time since its debut in 2019, the Tesla Model 3 has lost its leadership position in the premium electric sedan segment. The model that achieved this milestone is Xiaomi’s SU7, marking a significant moment for the Chinese automaker.
According to data from the China Passenger Car Association (CPCA), Xiaomi delivered 258,164 units of the SU7 in 2025. During the same period, Tesla Model 3 sales reached 200,361 units, meaning Xiaomi outperformed its rival by nearly 30 percent. This development came just weeks after Tesla announced its first-ever year-over-year sales decline in China.
Launched in March 2024, the Xiaomi SU7 managed to become the best-selling premium electric sedan in the world’s largest automotive market in less than two years. The achievement highlights how quickly Chinese brands are gaining ground in the global EV race.
Competitive Pricing and Rich Features
One of the key reasons behind SU7’s success is its aggressive pricing strategy combined with strong specifications. The SU7 starts at 215,900 yuan (around $31,000), while the Tesla Model 3 begins at 235,500 yuan (approximately $33,800).
In terms of driving range, Xiaomi also holds an advantage. The SU7 offers up to 700 kilometers of range under the CLTC standard, compared to 634 kilometers for the Model 3 RWD. This difference makes the SU7 more appealing for both daily use and long-distance driving.
Technology as a Differentiator
The SU7 stands out with its advanced technology package. Driver assistance systems are included at no extra cost, and newer versions come with LiDAR sensors as standard equipment. Additionally, the vehicle benefits from deep integration with Xiaomi’s HyperOS ecosystem, seamlessly connecting smartphones, tablets, and smart home devices.
Tesla, on the other hand, is attempting to stay competitive through promotional campaigns. The company currently offers an 8,000-yuan insurance subsidy and low-interest financing for up to seven years on the Model 3. However, rival brands such as Xiaomi, Li Auto, and Xpeng are matching these incentives, keeping competitive pressure high.
Pressure Extends Beyond the Model 3
Xiaomi’s challenge to Tesla is not limited to sedans. The company’s YU7 SUV has also begun to put pressure on the Tesla Model Y. With additional models planned for 2026, Xiaomi appears determined to expand its influence across multiple segments.
Meanwhile, Tesla’s overall performance in China is weakening. The company’s total deliveries in 2025 declined 4.78% year-over-year to 625,698 units. Even the Model Y, still one of China’s best-selling SUVs, experienced a 11.45% drop in sales.
