Xiaomi to Deploy Driver-Assist Fix for Some 40% of SU7 EVs

Xiaomi Corp. will deploy an over-the-air software fix to rectify a problem in its advanced driver-assistance technology installed in almost 40% of the SU7 electric sedans it’s sold.

The Chinese smartphone and electric vehicle maker will recall around 116,800 standard versions of the SU7, most of which were produced between Feb. 6, 2024, and Aug. 30 this year, due to the fact that the car’s driver-assist system may not adequately detect and warn of critical scenarios, according to a notice Friday on the State Administration for Market Regulation’s website. If drivers don’t retake control of the EV, there may be increased risk of collision, it said.

Xiaomi had delivered about 305,055 of the models, which debuted in March last year, as of July, according data from the China Automotive Technology and Research Center. At its launch, the standard version of the SU7 didn’t include lidar, a type of sensor that helps a vehicle “see” its environment and adds an additional layer of safety.

Xiaomi’s Hong Kong-listed stock fell as much as 2% on Friday before recovering to trade down 1.1%. The shares are up 64% this year.

“The muted market reaction is likely due to the fact that assisted driving isn’t a core value proposition for SU7 buyers,” Gary Tan, a fund manager at Allspring Global Investments LLC, said. “In China’s competitive EV landscape, consumers view assisted driving as a ‘nice-to-have’ rather than a decisive factor.”

The recall comes nearly six months after a fatal crash involving a standard version SU7 sedan that had its autopilot function turned on. The accident, which killed three people, prompted Chinese authorities to rein in deployment of advanced driver-assistance technology and scrutinize other aspects of EV design, such as recessed door handles. Beijing is working on draft guidelines that strictly define what driver-assist technology can and cannot do.

Xiaomi initially suffered falling sales after the accident and its usually vocal founder and Chairman Lei Jun stayed quiet for more than a month. However the blowback subsided and Xiaomi launched its second EV in June, the YU7 sport utility vehicle, which drew more than 240,000 orders within 18 hours.

The over-the-air update will include enhancing the adjustment of driving speed in complicated conditions such as rain or at night, according to a post on Xiaomi’s official EV Weibo account.

“It’s likely there’s no need for a physical recall,” said Kelvin Lau, an analyst at Daiwa Capital Markets Hong Kong Ltd. Because it can be fixed remotely, “the issue is not mechanical and the implied cost is small.”

Analysts led by Steven Leung, an executive director at Uob Kay Hian Hong Kong Ltd., noted that other automakers have faced similar recall episodes and it’s more important a company fixes the issue before any serious accident.

Beijing-based Xiaomi isn’t the only manufacturer to have suffered safety problems. US-listed Chinese EV maker Xpeng Inc. also issued a recall last week for more than 47,000 of its P7+ sedans to replace potentially faulty steering parts.