🧠 Food for thought

Implications, context, and why it matters.

Sales rose after a year of recalls and disputes

• The uptick came after China’s State Administration for Market Regulation, the country’s top market watchdog, announced a September 2025 recall covering 116,887 SU7 standard cars built from Feb. 6, 2024 to Aug. 30, 2025. The recall dealt with risks tied to the Level 2 driver-assistance highway navigation feature in certain extreme scenarios 1.
• In Q1 2025, the SU7 placed last in a quality ranking for mid- to large-size pure EVs. It also drew complaints over misleading marketing, including disputes around the SU7 Ultra’s optional “carbon-fiber dual-channel front hood” and other performance claims 1.
• Those problems led to a January 2026 teardown livestream that addressed safety worries and included a pledge to end “small-print disclaimers,” Lei Jun, CEO of Xiaomi, said 1.

Xiaomi’s broader business is paying for its EV push

• Xiaomi is using cash from other parts of the company to support carmaking, a business that takes heavy upfront spending 2.
• In Q2 2025, the EV unit posted an operating loss of about 300 million yuan (US$43.9 million), or roughly 6,000 yuan (US$880) per vehicle sold. In the same quarter, IoT, internet services, and smartphones brought in more than 20 billion yuan (US$2.93 billion) in gross profit 2.
• April deliveries of 30,000 fit within the 30,000 to 35,000 monthly range viewed as needed to spread fixed costs enough to reach profitability 2.
• As of Dec. 31, 2024, Xiaomi had nearly 15,000 offline stores in mainland China. That retail footprint could become a model for other tech platforms moving into complex manufacturing 2.