Chinese tech giant Xiaomi took another bold step into the electric vehicle market on Thursday with the launch of its new SUV, the YU7, at 13 showrooms across Beijing.

The unveiling marks Xiaomi’s continued push to compete with Tesla in the world’s largest car market.

The YU7 follows the success of Xiaomi’s debut sedan, the SU7, which has outpaced Tesla’s Model 3 in monthly sales since December. Orders for the YU7 will open in July, with pricing to be revealed at that time.

Industry analysts believe the YU7 poses a significant threat to Tesla’s best-selling Model Y. However, Xiaomi faces headwinds. Orders for its electric vehicles have declined in recent months following a fatal March crash involving an SU7 operating in driver-assistance mode. The company has also come under fire for unclear advertising, prompting a public apology.

Xiaomi has not yet disclosed the SUV’s price, but HSBC Qianhai has estimated it will range between 230,000 and 330,000 yuan ($31,989–$45,898). Analysts project Xiaomi could ship 100,000 YU7 units this year, with numbers climbing to nearly 250,000 in 2026.

Tesla’s Model Y currently starts at 263,500 yuan in China.