Xiaomi's EV Ambition Hits a Wall of Skepticism Despite Tesla-Undercutting Prices

Xiaomi's Sky Nomad SUV launch triggers stock sell-off amid delivery gap and chip shortage, raising doubts on 2026 targets.

The arithmetic behind Xiaomi's electric vehicle push is getting harder to ignore. The company unveiled aggressive pricing for its new Sky Nomad SUV lineup on Thursday evening, yet investors responded by dumping the stock — a move that underscores just how much ground the electronics giant has to make up in the second half of the year.

The shares slid 4.62% to €3.25 on Friday, following a pre-market dip of as much as 7.05% to €3.17 in earlier trading. The sell-off came despite Xiaomi positioning the two new range-extender models, the Sky Nomad N90 Max and N70 Max, at price points that undercut Tesla's Model Y L, which retails at 339,000 yuan. The N90 Max carries a pre-sale price of 299,900 yuan (roughly $44,170), while the N70 Max starts at 259,900 yuan.

A Pricing Strategy That Raises More Questions Than It Answers

Chinese media had floated expectations of an entry price around 200,000 yuan ahead of the launch — a level that would have undercut established rivals like the Li L9 and M9. Instead, Xiaomi opted to debut the top trims of each model line, with simpler Pro and Standard versions slated to follow later. The official market launch isn't scheduled until September, leaving a gap of several weeks between the price announcement and any meaningful sales data.

The Sky Nomad series rides on the new Kunlun architecture, a platform Xiaomi began developing in 2023. The project took roughly three and a half years to complete and comprises three core components: the powertrain, a so-called Super Range Extender, and a safety system. CEO Lei Jun positioned the platform as central to Xiaomi's growth plans for 2026, with the company targeting 550,000 vehicle deliveries for the full year — an increase of about 34% over the approximately 410,000 units delivered in 2025.

The Delivery Gap Is Hard to Ignore

First-half numbers, however, tell a more sobering story. Xiaomi EV delivered 185,055 vehicles in the first six months, representing just 34% of the annual target. To hit the goal, the company would need a dramatic acceleration in the second half — a tall order in a market where range-extender vehicles are losing momentum. Industry association CPCA reports that range-extender sales in China reached only 450,000 units in the first half, a 15.09% decline year over year.

Lei pushed back on the notion that the segment is saturated, arguing on Wednesday that the EREV market still holds substantial untapped potential. The company can point to cumulative deliveries of the SU7 and YU7 models surpassing 700,000 units, evidence that its existing lineup has found an audience. Whether that translates to the new SUV series remains an open question until reservation numbers start flowing in after the September launch.

The Chip Squeeze Complicates the Margin Picture

Beyond the EV division's challenges, Xiaomi's core smartphone business is navigating a global memory chip shortage. DRAM and NAND prices have climbed sharply, and worldwide smartphone shipments fell roughly 26% year over year in the second quarter of 2026. The company is leaning on its IoT ecosystem and HyperOS software platform to absorb the higher hardware costs, while also adjusting prices in India across its Redmi and flagship lines to pass on component inflation to consumers.

The margin pressure comes at an inopportune time. The EV price war in China leaves little room for profitability on vehicles, and analysts have already trimmed their 2026 earnings forecasts for Xiaomi. Regulatory risks in India and the European Union, including potential tariffs on plug-in hybrids, add another layer of uncertainty.

Technical Levels and the August 18 Catalyst

The stock's recent trajectory reflects the tension between optimism and caution. Shares had climbed 28.16% over the 30 days leading into the SUV reveal, recovering meaningfully from their yearly low. Yet the longer-term picture remains challenging: the stock trades 14.94% below its 200-day moving average, has lost 26.80% since the start of the year, and sits 46.25% lower over a twelve-month horizon. It also remains roughly 50% below its 52-week high of €6.51.

Friday's decline pushed the shares below the 100-day moving average at €3.21, though the 50-day average at €2.92 still holds as a technical support level. A break below that would put the yearly low of €2.34 back in play.

All eyes now turn to the quarterly earnings report on August 18. The key metric will be the operating margin in the smartphone division — if the chip crisis hits harder than expected, the bears gain the upper hand. A strong showing on Sky Nomad reservations could, conversely, provide the momentum needed to close the gap to the 200-day average. The Chengdu Auto Show, opening August 21, will offer the first public glimpse of the N90, with order data following only after the September market launch.