Xiaomi rolls out seven-year low-interest financing for YU7, adding pressure ...

by SONG Jianan

Xiaomi has launched a seven-year low-interest financing program for its first pure-electric SUV, the Xiaomi YU7, stepping up pressure on Tesla as competition in China's electric vehicle market increasingly shifts toward pricing and financing incentives.

Under the offer, customers who place orders by Feb 28, 2026 can buy the YU7 with a minimum down payment of 49,900 yuan, with monthly instalments as low as 2,593 yuan, the company said. All YU7 variants ordered during the promotion will also come with dual zero-gravity seats.

The move comes just over a week after Tesla unveiled similar incentives in China, underscoring a broader shift in the world's largest EV market toward competition driven by pricing and financing tools as growth slows.

On Jan 6, Tesla said it would introduce seven-year ultra-low-interest financing for the Model 3 and Model Y. For the Model 3 and Model Y, down payments start at 79,900 yuan, with monthly payments as low as 1,918 yuan. The Model Y L requires a minimum down payment of 99,900 yuan, with monthly payments starting from 2,947 yuan, and offers a five-year zero-interest option with monthly payments from 3,985 yuan.

Xiaomi, known as a consumer electronics maker and a late entrant to the auto industry, has repeatedly framed Tesla as its main benchmark, saying the U.S. automaker remains strong but not unbeatable and citing the Xiaomi SU7 sedan as having outperformed the Model 3 within its segment.

The YU7 has been on the market for just six months and still trails the Model Y in sales, Xiaomi said, adding that it expects the gap to narrow over time.

Since the start of 2026, Xiaomi has stepped up direct communication around its auto business, using livestreams to explain products and outline delivery plans. The company has set an internal target of 550,000 vehicle deliveries for 2026, after delivering more than 410,000 vehicles in 2025, well above its original plan of 300,000 units.

By comparison, Tesla reported global deliveries of 1.636 million vehicles in 2025, down about 8.6% year on year, but still nearly four times Xiaomi Auto's volume, underscoring the scale advantages Tesla retains despite slowing growth.

Xiaomi has also sought to reassure consumers over resale values amid reports of sharp declines in used-car prices. The company cited industry data showing the Xiaomi SU7 had a used-car value retention rate of 80.1% as of December 2025, placing it among the top performers in the market.