Xiaomi Stock Drops Following Tragic Electric Vehicle Crash
Xiaomi Shares Fall After Fatal Car Accident Involving Electric Vehicle
Xiaomi, a company known for its consumer electronics and now venturing into smart cars, experienced a sharp decline in its shares in Hong Kong following a tragic car accident involving one of its electric vehicles in China. The incident has raised concerns about the safety of its advanced driver-assistance system.
The company’s shares dropped 5.5% to 46.50 Hong Kong dollars, equivalent to US$5.98, on Tuesday afternoon, making it the top decliner on Hong Kong’s benchmark Hang Seng Index. This sudden decrease came after reports that one of Xiaomi’s SU7 models was involved in a deadly accident on an expressway in China’s Anhui province, resulting in the loss of three lives.
Xiaomi, like many other Chinese EV makers, has been emphasizing its advanced driver-assistance features as the industry focuses on developing autonomous driving technology. The company revealed that the SU7 model was in “navigation on autopilot” assisted-driving mode, traveling at an average speed of 116 kilometers per hour when the accident occurred on March 29.
According to Xiaomi’s Weibo post, the car’s driving system detected obstacles on the road and began to slow down before the driver took control. However, seconds after the driver intervened, the crash took place at a speed of approximately 97 kilometers per hour. The post did not mention the fatalities, but Xiaomi has established a team to assist with the police investigation into the accident.
The incident has sparked public concern about the safety of advanced driving-assistance systems, which are prevalent in Chinese EVs and are a key selling point for many brands. Despite the setback, Xiaomi’s first-ever car, the SU7 model, has seen strong sales since its launch last year and reported a gross profit margin of 18.5% in its first full year of operations in 2024.
While Xiaomi shares are up 35% year to date, the company will need to address safety concerns and reassure consumers about the reliability of its advanced driver-assistance system in light of this tragic accident.
