The drama at Xiaomi’s automotive division doesn’t seem to be winding down anytime soon. Just days after the company was forced to apologize to owners of the SU7 who spent $6,000 on an aero hood only to find out the vents were little more than cosmetic, and not long after a software update nearly reduced the Ultra’s 1,526hp to a mere 888hp, Xiaomi now claims it’s uncovered what it calls a smear campaign against the brand.

The news comes just days before Xiaomi is set to reveal the YU7 electric SUV and the Xring 01, its first in-house developed smartphone chipset. In a posting on their social media page, Xiaomi’s legal team posted an update saying they had uncovered a coordinated effort to defame the company across nearly 10,000 social media accounts. Several suspects are now under investigation by Chinese authorities.

More: Xiaomi Recruiting BMW Execs For European R&D Center

As reported by several local media including Car News China, the criminal gang was allegedly active since December 2024. The company claims that the bad actors used automatic copywriting software to fabricate false information about Xiaomi, and manipulated nearly 10,000 social media accounts to maliciously spread rumors and false statements. The group reportedly engaged in tactics such as stirring up online opposition and pitting rival brands against each other, all in an effort to damage Xiaomi’s reputation.

In a statement, Xiaomi described the situation as a new form of online “water army” crime, where a criminal gang uses automated software to generate fake content on a massive scale. “The distribution chain is complex, and the scale of the operation is enormous,” the company said. “This has had a severely negative impact on both the online environment and our corporate reputation.”

Who’s Behind It?

Even though no names were named, any number of rivals could be at play here. Cars are nowadays more tech-defined than ever and are bound to become even more so in the near future, as the chipset and automotive industries become more intertwined. Thus, when a disruptor comes along and threatens to change the status quo, apparently all gloves are off since there are billions of dollars at stake.

More: Xiaomi SU7 Outsells Tesla’s Model 3 In China

In the epic Iliad, Helen of Troy’s beauty sparked a war that would go down in history. Now, nearly three millennia later, Xiaomi has found itself in the strange position of being the brand that launched 10,000 social media accounts, each working to smear it in the months leading up to its first electric crossover. If anything, imitation is the sincerest form of flattery, and if rival companies are going to such lengths to bring down Xiaomi, it’s clear they fear what’s coming next.

Owners of the Xiaomi SU7 have been quick to share their enthusiasm for the innovative electric vehicle, but they’ve also been equally eager to voice their concerns when things go south. Recently, this has included a backlash over a software update that drastically reduced the SU7 Ultra’s peak power from a 1,526 horsepower to a more modest 888 hp. Now, the latest source of frustration is the optional carbon fiber hood.

This new carbon fiber hood comes with a hefty price tag of 42,000 yuan, or about $5,800, and takes its design cues from the hood seen on the original SU7 Ultra prototype. It’s equipped with a pair of huge air ducts that Xiaomi claims enhance cooling. However, several Chinese automotive bloggers recently put the hood to the test, only to find it provides virtually no extra air flow, meaning it’s a mostly cosmetic, and not a performance upgrade.

Read: Xiaomi’s SU7 Ultra Software Upgrade Was A 650-HP Downgrade

One blogger, as reported by CarNewsChina, conducted a simple test by placing a piece of paper near the vents and positioning a fan at the front of the car. The result? The paper remained perfectly still, proving that the cooling benefits were nonexistent. It’s a bit of an embarrassing reveal for Xiaomi.

The Chinese automaker moved quickly to address the issue. It issued an apology, clarifying that the hood was primarily intended to mimic the design of the one from the SU7 Ultra prototype. Furthermore, Xiaomi admitted that the carbon fiber hood option was never part of the original plan during the development of the production model.

To pacify disgruntled customers, the company announced that those with undelivered orders could switch to the standard aluminum hood. For those who had already received their cars with the carbon fiber hood, Xiaomi promised 20,000 reward points, which translate to a meager 2,000 yuan, or around $275 at current exchange rates.

Understandably, this gesture has done little to satisfy everyone. Reports suggest that up to 300 owners have banded together to demand full vehicle refunds, with many feeling that the promised upgrade was little more than an overpriced piece of carbon fiber with no real benefits to back it up.

While Xiaomi has built a brilliant performance sedan with the SU7 Ultra, it seems its marketing team needs to improve its messaging, as any slip-up or using too much hyperbole may come back to bite it.

Have you ever upgraded your phone or computer to the latest operating system and instantly regretted the decision, wishing you could just go back to the earlier version? That’s a scenario familiar to Chinese owners of the Xiaomi SU7 Ultra who discovered an update cost them around 650 hp.

The Ultra is the halo car in Xiaomi’s phenomenally successful SU7 lineup, a rival to the Porsche Taycan Turbo GT that costs a quarter as much and has laid waste to the German car at various racetracks thanks to its incredible 1,526 hp (1,548 PS / 1,138 kW) triple-motor drivetrain.

Related: First Fatal Xiaomi SU7 Crash Sparks Questions About Self-Driving Tech And Locked Doors

But owners were furious to learn that version 1.7.0 of its software reduced power to around 888 hp (900 PS / 662 kW) unless they could prove they were worthy of the true maximum. To unlock it, drivers had to complete a qualifying lap time on a Xiaomi-approved track that would be logged and verified by the SU7’s onboard Qualifying Mode laptime assessment feature, Car News China reports.

The update also made drivers wait an agonizing 60 seconds before the launch control function was ready to showcase the Ultra’s possible 1.89-second zero to 62 mph (96 km/h) times, ruling the tech out for impromptu stoplight races.

Xiaomi claimed the version 1.7.0 update’s power restrictions were designed with safety in mind, claiming the maximum performance potential was only created with track use in mind and by drivers who could handle all those Watts. But while some owners appreciated the sentiment, many took to online forums to complain that they now owned EVs with far less performance than they’d paid for, and which Xiaomi had advertised.

Following the backlash, Xiaomi pulled a U-turn, scrapping the performance limitations and promising to be more up-front about future software updates.

“We appreciate the passionate feedback from our community and will ensure better transparency moving forward,” Car News China reports a company representative saying.

Do you think Xiaomi was right to demand drivers prove their skills before being allowed the SU7’s full power?

Xiaomi’s team has been showered with praise in recent months and has probably become used to reading nothing but positive headlines. However, the Chinese carmaker is now hitting the headlines for all the wrong reasons, after the first major accident involving the SU7 sedan resulted in three fatalities. The incident has cast a shadow over the tech giant’s automotive ambitions and raised tough questions about the safety and reliability of advanced driver-assistance systems.

On March 29, a Xiaomi SU7 was traveling in China with three passengers onboard. The vehicle was driving along the Dezhou–Shangrao Expressway in Anhui Province with its Navigate on Autopilot (NOA) system engaged, maintaining a steady speed of 116 km/h (72 mph). As it approached a construction zone and a lane closed off with barriers, the SU7 struck a concrete divider at 97 km/h (60 mph), sparking a fire that ultimately engulfed the car.

Read: Xiaomi Aims To Sell More EVs In China Than All German Brands Combined

Shortly after the crash, Xiaomi released a timeline detailing the moments leading up to the collision. At 10:44:24 p.m., the SU7’s Navigate on Autopilot system issued a warning—“Obstacle ahead”—and began braking. One second later, the driver took control, steering left by 22.06 degrees and applying 31% brake pressure. Another second later, they adjusted slightly to the right by 1.06 degrees and increased braking to 38%. Despite these apparent efforts to avoid the crash, the vehicle struck the concrete barrier.

The impact immediately triggered the eCall emergency system. Within 20 seconds, the registered owner of the SU7 was contacted and confirmed he was not the driver. An ambulance was dispatched and arrived around 11 p.m., but tragically, all three occupants had already died.

The Xiaomi SU7 vehicle in China was driving at 116km/h in NOA on the highway, with the last speed reported to be 97km/h just before the collision with the guardrail.

A fire broke out after the collision, killing all three female college students in the vehicle.

Xiaomi issued a… pic.twitter.com/nxHGGYXhOR

— Tsla Chan (@Tslachan) April 1, 2025

Xiaomi says it is fully cooperating with local investigators to determine the cause of the crash. According to Reuters, which cited reporting from the Chinese newspaper Economic Observer, the father of one of the victims was told by local police that the car key failed to unlock the doors after the impact. In a statement, Xiaomi said it has not yet been able to confirm whether the doors could be opened at the time of the accident.

Shares in the Chinese technology giant fell 5% after word of the crash became public. Company boss Lei Jun has vowed to “respond to the concerns of families and society,” while investigating the crash.

Photos Weibo / Shine

Xiaomi is determined to become a major global player in the EV industry and to make this happen, it’s recruiting experienced talent from other brands, including at least five senior executives from BMW. They will work at the brand’s research and development center in Europe, although an exact location for this site has yet to be announced.

A search through LinkedIn reveals that Xiaomi hired Rudolf Dittrich from BMW last year to serve as the head of its European R&D center. Dittrich has worked at the German premium automaker for 15 years and also has experience at the Williams and Sauber Formula 1 teams. Additionally, Dusan Sarac has joined Xiaomi’s European operations after several years at BMW and Rolls-Royce.

Read: Xiaomi Aims To Sell More EVs In China Than All German Brands Combined

Reuters understands that Jannis Hellwig has also jumped ship to the Chinese EV brand and will serve as a senior engineer on performance development and integration. The technology giant is also looking for a senior automotive designer, senior automotive exterior designer, and vehicle dynamics engineers in Munich, Germany.

There’s no word on where the technology giant’s European R&D facility will be located, with the brand simply saying the site is “in the process of planning.”

It’s not just talent that Xiaomi is snatching from the Germans. It wants to sell 350,000 EVs in China this year, and if it can hit that target, it will surpass the combined 2024 EV sales of Volkswagen, Audi, BMW, Mercedes-Benz, and Porsche. That would be quite a feat for the company, particularly since it only started building the electric SU7 sedan this time last year.

Now, with the hypercar-rivaling SU7 Ultra on the market, Xiaomi appears to be going from strength to strength. Moreover, 2025 is expected to be a pivotal year for the firm as it’ll start production and deliveries of the YU7. The new electric SUV undercuts the Tesla Model Y and, given the global demand for high-riding vehicles, should sell in far greater numbers than the SU7 sedan.

Not long ago, premium German cars were seen as the epitome of luxury in China. For brands like Mercedes-Benz and Porsche, China was consistently their largest market, with sales surpassing those in any other country. However, as new homegrown brands have emerged, local preferences are beginning to shift toward Chinese companies and their offerings. Xiaomi is a perfect example of this shift.

Xiaomi, primarily known for being one China’s largest makers of electronics and consumer goods, producing everything from vacuum cleaners to computer monitors, fridges, suitcases, and smartphones. Then, the brand’s boss decided he wanted to build an electric vehicle. Unlike the billionaire founder of Dyson, who famously failed to launch an EV, Xiaomi has succeeded where others couldn’t, with its first electric vehicle, the SU7.

Read: Why Xiaomi Succeeded In Becoming An Automaker While Apple Failed

Customer deliveries of the SU7 started less than a year ago, and the company already has its sights set on the German establishment. The company aims to sell 350,000 EVs in China this year, thanks to the SU7 and the upcoming release of its Tesla Model Y competitor, the YU7. If Xiaomi can hit this target, it would surpass the combined EV sales of Volkswagen, Audi, BMW, Mercedes-Benz, and Porsche in China from last year, Handelsblatt reports.

Expanding Beyond China

It’s not just at home in China, where Xiaomi wants to grow its EV business. Earlier this month, the company’s president William Lu, revealed plans to expand into more markets. While he didn’t specify exact dates, he assured that Xiaomi would enter new regions “within the next few years.”

The arrival of the YU7 will mark a pivotal moment for the company. SUVs continue to dominate global sales, and there’s a strong chance the YU7 will outperform the SU7. Deliveries are set to begin in June or July, and the industry will be watching closely to see if Xiaomi can continue its rise.

Cast your mind back a few years, and the internet was rife with speculation that Apple was about to launch its own automobile. The tech giant had been linked to partnerships with all kinds of automakers, including Hyundai, Kia, Porsche, BYD, and Toyota. However, early last year, reports emerged that the ambitious project had officially been canned, with up to around 600 employees given their marching orders or being retrenched within the company.

While we may never know just how close the world came to an “iCar”, what we do know is that one of Apple’s tech rivals has quietly gone about bringing its own EV to market. That rival is Xiaomi, another tech company that managed to sell 135,000 units of its SU7 in China since it debuted in March 2024.

Read: Apple Lays Off 614 Workers After Canceling Electric Car Project

While Xiaomi is best known in the West for its phones, at home, the company has developed a connected ecosystem of consumer products that even the likes of Apple, Samsung, and Google can only dream of. From smart lights to air purifiers to robot vacuum cleaners to blenders, the company offers a wide range of consumer tech products, all of which are controlled from one app. And that’s exactly why a car is a great addition to the company’s lineup.

All About The Ecosystem

Nowadays, tech companies aren’t interested in selling you a singular device – they’re more invested in offering a whole ecosystem, the benefits of which can only be truly reaped once you commit to a company’s products. Whether it be the ease with which an iPhone can communicate with a Macbook or how seamlessly a Galaxy smartphone can stream to a Samsung TV, ecosystems are all around us. Even cars are judged based on whether they offer CarPlay or Android Auto.

However, Xiaomi offers buyers more than just an infotainment system. By selling its own car, Xiaomi can potentially attract clients to its network of connected devices like never before. The SU7 can use data collected from those other devices to ready itself for a user’s routine, such as determining the best time to recharge the car’s batteries.

“Xiaomi has really started infiltrating your home,” said Gary Ng, an economist with Natixis Corporate & Investment Banking, speaking to the New York Times. “Everything is linked together, and this is something other companies couldn’t do.”

China’s Supply Chain Success

Another factor that allowed Xiaomi to develop its first car quickly is the environment in which it operates. China’s electric car makers have been the beneficiaries of billions of dollars worth of state support. The supply chain for EVs is practically wrapped up inside the nation, with Xiaomi securing battery supplies from BYD and CATL, two of the world’s largest battery makers. The company then took over a manufacturing plant from Beijing Auto Group before pumping out its new sedan.

In all aspects, Xiaomi managed to hit the ground running. Now, with plans to launch a second car in the form of an SUV, and construction of a new manufacturing plant well underway, its automotive plans are full steam ahead.

See Also: Xiaomi President Confirms Global EV Expansion Coming Soon

Of course, success is still far from guaranteed. The company faces intense competition from a wide range of home-grown rivals, including electronics rival Huawei, which has teamed up with multiple automakers.

But Xiaomi is also putting up a fight against foreign brands. With the SU7 starting at just $30,000, it offers Porsche-like looks with class-leading tech. Coincidentally, in the year since the Xiaomi SU7 was launched, Porsche’s sales in China were down 30 percent.

With more and more Chinese automakers looking for success outside of their home nation, it could be a matter of time before more of the globe starts seeing the SU7 as a compelling option.