China's Xiaomi starts delivering the first of more than 100,000 EVs ordered

Beijing: Chinese smartphone maker Xiaomi on Wednesday said it has received more than 100,000 orders for its first car - a sporty electric vehicle called the SU7 - as it began deliveries.

"Xiaomi's car officially debuts, the real revolution in smart cars has officially begun, and China will surely give birth to a great company like Tesla," CEO and founder Lei Jun said at a ceremony in Beijing marking the first deliveries.

The first deliveries come from a limited batch of 5,000 cars that Xiaomi had already produced - called the "Founder's Edition," equipped with additional accessories for early buyers.

Following last week's launch of the SU7 - short for Speed Ultra 7 - Xiaomi advised buyers of its sedan that they could face wait times of four to seven months, a sign of robust demand.

Xiaomi's shares surged as much as 16% on Tuesday as the SU7 drew strong interest, though a brokerage forecast the firm would lose nearly $10,000 per car this year. Its shares traded more than 3% lower Wednesday morning, against a 1.1% fall in the broader Hang Seng Index.

At Tuesday's highest, the company had a valuation of $55 billion at a share price of HK$17.34 - higher than that of traditional U.S. automakers General Motors and Ford at $52 billion and $53 billion, respectively.

Xiaomi's SU7 enters a crowded China EV market with an attention-grabbing price tag - under $30,000 for the base model, cheaper than Tesla's Model 3 in China.

While the world's largest auto market is challenging for newcomers due to a cut-throat EV price war and slowing demand, analysts have said Xiaomi has deeper pockets than most EV startups and its smartphone expertise gives it an edge in smart dashboards - a feature prized by Chinese consumers.

The company earns the majority of its $37.5 billion revenue from selling smartphones.

The SU7 launch fulfils the ambition of Lei, who announced the company's foray into EVs in 2021, pledging to invest $10 billion in the auto business as "the last major entrepreneurship project" of his life.