Xiaomi Stock: Fatal SU7 Crash Triggers 20% Decline

The Chinese technology group Xiaomi is experiencing a significant downturn in its stock price, with shares falling over 20% from their mid-March all-time high. Tuesday brought another 4% drop on the Hong Kong exchange, continuing the negative trend. This decline stems directly from a tragic accident involving a Xiaomi electric vehicle on a Chinese highway, where three people lost their lives. According to reports, the SU7 model collided with a guardrail, immediately caught fire, and the doors automatically locked, trapping the occupants with fatal consequences. The incident has raised serious concerns about the safety of Xiaomi's smart-driving technology and cast a shadow over the company's ambitious plans in the automotive sector, despite impressive delivery figures of nearly 30,000 electric vehicles in March.

Contrasting Business Performance

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Paradoxically, the stock's poor performance contradicts Xiaomi's excellent sales figures in the New Energy Vehicles (NEV) segment, highlighting the successful expansion of the former smartphone manufacturer into the automotive market. Market observers view this discrepancy between operational strength and stock performance as a classic example of how isolated incidents can profoundly impact investor perception, particularly for technology companies venturing into safety-critical fields like electric mobility. The current weakness might also be contextualized within Xiaomi's impressive trajectory since August 2024, when the stock began a rally that ultimately yielded gains exceeding 300% at its peak.