After Elon Musk predicts leading carmakers will be Chinese, smartphone giant Xiaomi unveils first EV and vows to be in ‘world’s top 5’ 

“There’s a lot of people out there who think that the top 10 car companies are going to be Tesla followed by nine Chinese car companies,” the Tesla CEO said at last month’s New York Times DealBook conference. “I think they might not be wrong.” 

Of course, he was talking about China’s carmakers. What about a Chinese smartphone maker? 

On Thursday in Beijing, smartphone giant Xiaomi unveiled its first electric vehicle—and said it aims to become, as CEO Lei Jun put it, “one of the world’s top five automakers” over the next 10 to 15 years.

Welcome aboard, Xiaomi SU7!⚡️ pic.twitter.com/bpJJmC8EB8

— Lei Jun (@leijun) December 27, 2023

“They have a significant opportunity to break through as the automobile becomes a smart device,” Bill Russo, CEO of Shanghai-based advisory firm Automobility, told Reuters.

The vehicle, called the SU7, or Speed Ultra, will share an operating system with the company’s phones and other devices. Russo noted that Xiaomi has “hundreds of millions of ‘Mi Fans,’ or members of its smart device ecosystem.”

Xiaomi, founded in 2010, is among the world’s top five global smartphone brands, alongside Apple, Samsung, and China’s Oppo and Vivo. It also makes other consumer electronics and household appliances. 

Apple, too, has long been rumored to be working on an EV that would integrate with its iOS.

Xiaomi’s new five-seat sedan will have a range of up to 500 miles on a single charge, a top speed of about 165 miles per hour, and a “super electric motor” that will allow it to accelerate faster than Tesla or Porsche EVs, the company’s CEO said. 

But Xiaomi faces an uphill battle. Formidable rivals already rule the road in China, chief among them BYD—backed by Berkshire Hathaway and commanding a third of the nation’s EV market—and Tesla (with about 9%). Those two market leaders and others have engaged in fierce price wars this year in China. In the second quarter, one Tesla rival, Nio, lost $835 million, or $35,000 on each car it sold, reported the New York Times.

The SU7, depending on its configuration—single or dual motor—will be powered by batteries from either Contemporary Amperex Technology or BYD, according to Bloomberg. 

As Fortune reported earlier this month, Xiaomi is spending far above the industry average to break into China’s EV market. The company is spending 10 times the amount on labor and investment automakers generally devote to a new model, Lei told Chinese state broadcaster CCTV.

He didn’t reveal the price of the SU7, which will likely go on sale in China in several months, but he said it would “indeed be a bit high.”