Xiaomi Overtakes Tesla in Key Chinese EV Sales Race

Xiaomi KYG9830T1067

New data reveals a significant shift in the competitive landscape of China's automotive sector. Xiaomi has decisively outperformed Tesla in retail sales for a flagship model, claiming the top spot in the world's most critical car market.

According to the latest report from the China Passenger Car Association (CPCA), Xiaomi's new SUV, the YU7, achieved remarkable sales volume in January 2026. The company sold 37,869 units of this model. In a direct comparison, Tesla's performance was overshadowed, with sales of its Model Y totaling just 16,845 vehicles for the same period.

This sales disparity has led to a dramatic reshuffling of the market rankings. The Xiaomi YU7 secured first place in overall retail sales across all powertrains. Consequently, the Tesla Model Y plummeted from its leading position in December all the way down to 20th place. Even within the pure battery-electric vehicle segment, Tesla fell back to seventh position.

Resilient Performance Amid Market Headwinds

Xiaomi's electric vehicle division delivered a total of 39,002 cars in January. This figure represents a substantial year-over-year increase of 70.34%. While this marks a sequential decline of approximately 22% from December 2025, industry observers attribute the drop primarily to seasonal factors. The timing of the Chinese New Year holiday and the expiration of certain purchase incentives pushed the overall market penetration rate for new-energy vehicles down from 59% to 35%.

Despite these challenging conditions, Xiaomi managed to surpass the cumulative milestone of 600,000 vehicle deliveries since its market entry. This achievement underscores the sustained consumer demand for the technology giant's automotive products.

A Strategic Pivot Impacts Sedan Sales

The current sales success is almost entirely driven by the YU7 SUV, which accounted for 97% of January's volume. In contrast, sales of the SU7 sedan dwindled to a low of 1,133 units.

This shift is intentional and part of a planned transition. Xiaomi's CEO, Lei Jun, confirmed that production of the first-generation SU7 concluded on February 10. The company is now concentrating its efforts on preparing for the launch of the next-generation sedan. The new SU7 model is scheduled for release in April 2026 and is expected to offer a driving range of up to 902 kilometers on a single charge.

Ambitious Targets for the Year Ahead

Xiaomi's leadership remains committed to an aggressive growth trajectory. For the full 2026 calendar year, management has set a sales target of 550,000 vehicles. Hitting this goal would equate to a 34% increase over the company's 2025 performance.

The upcoming launch of the next-generation SU7 in April, followed by additional planned model releases throughout the year, are identified as the next key catalysts expected to drive future sales momentum.