Just as the auto industry was grappling with BYD ‘s rapid rise, Chinese smartphone company Xiaomi has burst into the market — undercutting Tesla and vowing to become a global player. Even as Apple this year scrapped development of an electric, self-driving car , Xiaomi’s founder and CEO Lei Jun pledged that making a car will not only be his final legacy project, but a product that turns the company into one of the top five automakers in the world in the next two decades. Xiaomi’s Hong Kong-listed shares soared last week to a two-year high after the company introduced its electric SU7 sedan at a price about $4,000 cheaper than Tesla’s Model 3 — and with similar tech capabilities. Wider analyst attention In the last several days, Xiaomi has gained wider attention from auto and tech industry analysts beyond those who previously covered it as only a smartphone play. “Add Xiaomi to the list of capable China auto/tech firms that may represent attractive collaboration candidates as Western legacy auto firms look for ways to achieve higher scale, improved capital discipline and lower execution risks,” Morgan Stanley auto analyst Adam Jonas said in a note Thursday. Meanwhile, Tesla last week revealed that its deliveries fell in the first quarter from a year ago . Excluding Covid, that was the first decline in Tesla deliveries since 2012, Jonas pointed out. While he still likes Tesla longer-term , he and his team will hold a client webinar on Xiaomi, Tesla and global EVs on Tuesday. “If Xiaomi can continue to outperform peers on [driver assist] and smart cabin features, we believe it is likely to become a disruption force with large growth potential,” Morgan Stanley’s greater China tech hardware analyst, Andy Meng, said in a note Monday. Meng reiterated the bank’s overweight rating on Xiaomi, and its price target of 17.50 Hong Kong dollars ($2.24). Xiaomi shares nearly reached that price during last week’s surge. The stock later gave back much of those gains, and are…
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