Just before Christmas, the German government has abruptly stopped the purchase premium for electric cars, catching both customers and manufacturers off guard. Critics fear that this move will once again slow down and delay Germany’s transition to e-mobility.

Meanwhile, in China, the market for electric vehicles is booming and driving rapid growth in the young industry. It’s not the traditional automakers that are electrifying their fleets, but rather newly founded companies, start-ups with niche characteristics, and firms like US pioneer Tesla that are popping up in China and revolutionizing the automotive market.

BYD has long taken the lead in China’s electric vehicle segment, followed by Tesla at a distance. Now, a new player is entering the market: Xiaomi. The brand may be more familiar to most people from the electronics department of major retail chains. The company, founded in 2010, has so far made a name for itself in smartphones, tablets, smartwatches, and headphones. Electric scooters are also part of their portfolio.

Xiaomi: Mobile phone manufacturer presents electric vehicle Just a few days ago, Xiaomi fulfilled its promise from 2021 and unveiled its first electric car. The sedan, named SU7, is expected to be available from 2025 and is just the beginning for Xiaomi’s new era. Over the next two decades, the company has set itself the ambitious goal of becoming one of the top 5 largest electric vehicle manufacturers in the world.

The road ahead is long, but not impossible, as Tesla has impressively demonstrated. The once-mocked US manufacturer has long been in the lead. From just a few thousand vehicles at the start of the electric car offensive, production has now been massively expanded and the product range has been expanded with additional models. Even in Germany, where many drivers consciously opt for traditional brands from Munich, Stuttgart, and Wolfsburg, Tesla has taken the lead in the electric segment. Traditional manufacturers have so far had little to offer in response.

Chinese companies are also aiming for expansion. After the first Tesla factory on European soil was built in Grünheide, Brandenburg, BYD is now planning a plant in the EU, specifically in Hungary. With Xiaomi, the next competitor may already be waiting in the wings.

Europe’s traditional manufacturers leave a gaping hole – China gratefully accepts it Chinese providers have the potential to pose a threat to long-established European carmakers. While there are only 3 electric models available for less than 30,000 euros in Germany, Chinese models impress with significantly lower entry prices.

There is a large market for affordable electric cars. At the same time, traditional manufacturers have recently announced the end of their small car model ranges, including Ford sending its popular Fiesta into retirement. However, this farewell to the small car segment could have long-term consequences in terms of market share. The Chinese are ready to fill the gap that is emerging.