Competition between Xiaomi SU7 and Zhijie S7 in the Chinese Electric Car Market

After the Xiaomi SU7 was launched, its booming sales scene not only made its competitors envious but also led to some unfriendly competition. For instance, during the presale event of the Zhi Ji L6 in April, there was an attempt to overshadow Xiaomi SU7, followed by three public apologies to Xiaomi.

Recently, news emerged that Zhijie Motors intercepted Xiaomi by offering a $5000 cash subsidy to customers who switch their Xiaomi SU7 orders to Zhijie S7.

According to a staff member at a Huawei authorized experience store in Chengdu, Sichuan, this policy is indeed factual. Since the launch of Xiaomi SU7, major Huawei stores have introduced this temporary policy, valid until the end of May. All Hongmeng Intelligent Travel’s contract stores nationwide can apply for this subsidy for their customers. The staff member also mentioned that a Xiaomi SU7 customer, tired of waiting for delivery, chose the Zhijie S7 instead and received a direct deduction of $5000, effectively compensating for the deposit loss incurred by the Xiaomi customer.

However, there is no public information available about the Zhijie subsidy policy for Xiaomi SU7 car owners on Huawei’s experience stores, official website, or other public channels. Zhijie Motors has also not made any official statements regarding the aforementioned news. Some netizens speculate that while the cash subsidy by Zhijie S7 could be a dealer’s action, it is highly likely that it was conducted with the tacit approval from the manufacturer.

The competition between Zhijie S7 and Xiaomi SU7 did not start with this recent battle for orders. Just three days after the launch of Xiaomi SU7, Hongmeng Intelligent Travel offered a 7-day limited-time car purchase benefit, providing up to a $55,000 discount for buying Zhijie S7. Industry experts note that the rivalry between Huawei and Xiaomi in smartphones has now spilled over into the new energy car sector.

As the first intelligent pure electric car produced through cooperation between Huawei and Chery, the Zhijie S7 was already launched in November last year, receiving orders for 20,000 units post-launch. However, due to factors like factory relocation, the Zhijie S7 faced challenges with deliveries, resulting in poor sales performance. Data shows that within the first three months of its launch, Zhijie only sold a little over 2,000 units. This situation has put both partners in a somewhat embarrassing position.

To overcome the earlier negative impact, Zhijie decided on a price reduction and additional features for the S7, followed by a second launch announcement on April 11th. On April 18th, Chairman of Huawei’s Intelligent Car Solutions BU, Yu Chengdong, announced that over 4,500 Zhijie S7 units were expected to be delivered in April.

Given this, the re-released Zhijie S7 might still perform well in its first month. So, why continue the ‘hidden battle’ with Xiaomi SU7 for market dominance?

It’s worth noting that the performance of Xiaomi SU7 and Zhijie S7 products is almost neck and neck. Both have similar vehicle sizes, price points, and configurations. While the Zhijie S7 boasts the Hongmeng Cockpit 4.0, the Xiaomi SU7 features the Thunder OS operating system, each having its unique smart features.

However, in terms of marketing, Xiaomi SU7 undeniably has its own edge and can attract a significant number of young consumers. Conversely, although the Chairman of Chery, Yin Tongyue, personally endorsed the Zhijie S7 during its re-launch, it still struggles to match the market heat of Xiaomi SU7. Thus, Xiaomi’s production capacity issues and longer delivery times inadvertently create a window of opportunity for Zhijie S7 to ‘steal’ orders and kick off this battle for market dominance.

Final Thoughts

For prospective owners who made a deposit for Xiaomi SU7, switching to Zhijie S7 for their purchase entitles them to a $5000 cash subsidy. While this method of ‘stealing’ orders with Zhijie S7 may seem questionable from Xiaomi’s perspective, it benefits consumers who are more inclined to pay for the Zhijie S7. This game of strategies for sales reflects how far companies are willing to go. With these maneuvers in place, April’s sales performance of Zhijie S7 might just dazzle consumers. The outcome will certainly be one to watch.

(This article was originally created by the Wenwu Chedao New Media Studio. Please provide credit when sharing: Wenwu Chedao, Author: Xia Mu, Personal perspective, for reference only)