Xiaomi shares post worst week in 3-1/2 years as accidents stoke EV safety concerns

BEIJING (Reuters) -Shares of Chinese EV maker Xiaomi suffered their biggest weekly loss in more than 3-1/2 years on Friday, after media reported two separate accidents involving its best-selling model this week.

Xiaomi shares ended the day 3.7% lower at HK$45.96 ($5.92), the lowest close since April 22. For the week, they tumbled 11.7%, the worst such decline since late January 2022, though year-to-date, the shares are still up by a third.

On Friday morning a SU7 sedan lost control in the central city of Wuhan, where it knocked down guard rails in the middle of the road, drove into the opposite lane and collided with a van, according to the Sanxiang Metropolitan Daily, a government-backed newspaper.

Video from the scene circulated by the newspaper showed the car's left front wheel axle had broken. It was not clear if there were any casualties.

That followed an incident on Monday involving a 31-year-old man, suspected of drunk driving, who was killed in a collision in Chengdu. When passersby tried to pull him out of his burning SU7 Ultra they were unable to open the car doors, Chinese media reported.

Xiaomi hasn't publicly acknowledged that the accidents involved its electric vehicles. Chinese police issued a statement that detailed the Chengdu incident but did not name Xiaomi.

The company didn't respond to a request for comment.  

In a speech to an industry event in Beijing on Thursday, his first public appearance after the Chengdu accident, Xiaomi CEO Lei Jun made no mention of the crash, but called on the industry to focus resources and energy on technology R&D under the government's guidance and with safety as the basis. 

He also urged a joint boycott of online trolls and malicious negative campaigns.

The Chinese smartphone maker turned EV maker launched the SU7 in March 2024. The electric sedan had begun outselling Tesla's Model 3 on a monthly basis since December, before handing the lead back in September.

Under a product recall issued last month by the market regulator, Xiaomi announced a software update for over 115,000 SU7 sedans to fix potential safety issues when its assisted driving features are used.

It saw bumper orders for its electric SUV YU7 in late June, despite a deadly crash involving an SU7 in assisted driving mode at the end of March.  

($1 = 7.7668 Hong Kong dollars)

(Reporting by Beijing, Shanghai and Hong Kong newsrooms; Editing by David Dolan and Kim Coghill)