Xiaomi's YU7 car buyers face year-long wait for delivery, sparking complaints

SHANGHAI (Reuters) -China's Xiaomi is telling customers of its new YU7 electric sports utility vehicle they will have to wait more than a year to receive their cars, sparking a fresh wave of complaints against the company.

The smartphone turned EV maker said it received roughly 240,000 orders for the YU7 in the first 18 hours after the car went on sale on Thursday night, but only a small number of vehicles were available for immediate delivery.

By Tuesday, the Xiaomi app showed purchasers were facing a wait of between 38 and 60 weeks, according to Reuters checks.

Since Friday, more than 400 buyers have lodged complaints on Sina's Black Cat consumer complaint platform saying they were not made aware of the long wait and demanding a refund, according to a Reuters review of the records on the platform.

Buyers had to make a non-refundable deposit of 5,000 yuan ($697.97) to place their order.

They said the official app only showed the estimated waiting time for the car after the order had been confirmed. They also raised concerns about whether the longer wait would mean they would have to pay more because a tax exemption for EVs is set to expire at the end of this year.

Xiaomi did not immediately respond to a request for comment. Its charismatic CEO Lei Jun said on his Weibo account, where he has 26.8 million followers, that he would answer some questions raised after the YU7 launch in a livestreaming event on Wednesday.

Xiaomi made a huge splash in China's EV market with the launch of its first vehicle, the SU7 sedan, in March last year. While early buyers of the SU7 initially faced waits of up to 7 months it has outsold Tesla's Model 3 in China on a monthly basis since December.

The company has been grappling with a consumer backlash since a fatal crash involving an SU7 in March. It has also faced complaints over the confusion surrounding vehicle delivery times, as well as optional features.

The YU7 is Xiaomi's second model and priced from 253,500 yuan ($35,360), nearly 4% less than Tesla's Model Y, currently China's best-selling SUV. Lei has been open about how Xiaomi wants to challenge Tesla's Model Y for the top spot.

Xiaomi has been ramping up output at its Beijing plant and plans new factories on two plots of land nearby. Monthly output has increased to 28,000 units in May from 4,000 units last March.

($1 = 7.1636 Chinese yuan renminbi)

(Reporting by Zhang Yan, Brenda Goh; Editing by Kate Mayberry)