Tesla Model Y is priced at 263,500 yuan in China, and with the recent launch of Xiaomi YU7, the American EV maker is likely to witness a dip in its market share.

The YU7 is Xiaomi's second car since the Beijing-based firm entered the auto sector last year with its sporty electric SU7 sedan, which drew styling cues from Porsche and was priced below Tesla's Model 3. Since December, the SU7 has outsold Tesla's Model 3 in China on a monthly basis.