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Xiaomi has started a service allowing buyers to customise their SU7 Ultra electric sedans with select trim and paint jobs – adding at least 100,000 yuan (S$18,000) to the sticker price.
BERLIN – Chinese automakers are already beating their Western rivals when it comes to winning over the country’s middle-class drivers. Now, they are coming for rich customers looking to add a little extra to their cars.
Xiaomi in September started a service allowing buyers to customise their 529,900 yuan (S$96,000) SU7 Ultra racer electric sedans with select trim and paint jobs – adding at least 100,000 yuan to the sticker price.
A major smartphone designer that is making quick inroads with its electric vehicles (EVs), Xiaomi is competing for consumers who may otherwise opt for an individualised Porsche or another premium European brand. The German luxury carmaker is also pushing to expand sales of bespoke 911 sports cars in China as it gets squeezed on EVs by local brands.
Porsche and its Western peers long enjoyed strong growth in China, with renowned precision engineering of combustion engine vehicles. But in recent years, Xiaomi, BYD, Nio and other local manufacturers have flipped the script with cutting-edge software and battery technology. Having cornered the market for affordable EVs, they are now targeting wealthier consumers.
While Xiaomi’s SU7 Ultra sells for less than the 918,000 yuan Porsche Taycan, the Chinese model bears an uncanny resemblance to the German company’s flagship electric model. SU7 Ultra buyers who want to customise their vehicles are required to commit at least 100,000 yuan to their personalised touches, which include 24K gold hood badges and forged wheel hubs in four colours. The service also extends to the 329,900 yuan YU7 Max, a sport utility vehicle that has been compared to Ferrari’s Purosangue.
For Xiaomi, challenging upmarket Western brands at a lower price point extends beyond cars. Billionaire co-founder and chief executive officer Lei Jun has also just unveiled a smartphone designed to take on the new iPhone 17 that is more than US$100 cheaper (S$129) than the Apple handset.
By adding pricey extras for car buyers, Xiaomi is tapping a lucrative trend. The likes of Ferrari, Bentley Motors and Lamborghini have for years offered their super-rich customers the chance to spend extra cash to make their cars unique. One member of the Qatar ruling family’s seven custom Porsche 959s featured buffalo leather interiors and a gold-plated exhaust tailpipe.
Porsche says more than 90 per cent of 911 buyers choose at least one option from its personalisation business, Exclusive Manufaktur, which can add tens of thousands of dollars to the purchase cost.
Unique paint jobs are among the most popular. Customers can spend around US$13,000 to select from the brand’s library of more than 190 colours, or spend more than US$30,000 to match their new car to their favourite lipstick shade, baby blanket or sports team jersey.
Customised models typically tend to keep their value better over time, something that buyers splashing out lots of money look for – that is, unless the customer has decked out his or her Ferrari in garish purple or another look too ostentatious for most owners. Weak residual values for the Taycan has hit demand for the model.
Porsche plans to expand the customisation options and bolster its in-car software and features in China after seeing volumes plummet there. The bespoke model programme is currently limited by manpower and space at its Exclusive Manufaktur headquarters in Zuffenhausen, Germany.
The Exclusive Manufaktur business brings in around €5.6 billion (S$8.5 billion) in sales and as much as €2.5 billion in profit, according to estimates from Citi analyst Harald Hendrikse.
The analyst cautioned that Xiaomi’s push might not attract every potential Porsche owner.
“Xiaomi cars are competing more directly with Audi, BMW or Mercedes,” said Mr Hendrikse, who noted that selling more add-ons is not guaranteed to boost business either.
“Best case we’re talking about is between 1 per cent and 2 per cent of global revenues,” he added.
Still, it is clear that Xiaomi is encroaching on the territory of Western premium brands. The amethyst purple colour option the automaker has unlocked for its customisation programme takes around 50 hours to apply and includes hand polishing, Mr Lei said.
This paint job is “comparable to that of Rolls-Royce or Bentley”, he said. “I want more people to be able to enjoy the service that comes with top-range luxury cars.” BLOOMBERG
[SRC] https://www.straitstimes.com/business/companies-markets/porsche-and-xiaomi-face-off-over-custom-model-buyers-in-china
