Elon Musk said Chinese electric automakers will find “significant” success outside of China, even as his firm Tesla faces intense competition from these same companies.

“The Chinese car companies are the most competitive car companies in the world. So, I think they will have significant success outside of China depending on what kind of tariffs or trade barriers are established,” Musk said on Tesla’s earnings call on Wednesday.

“Frankly, I think, if there are not trade barriers established, they will pretty much demolish most other companies in the world.”

It’s not the first time Musk has heaped praise on Chinese EV makers. Last year, the billionaire called Chinese EV firms “the most competitive in the world” and said they are likely to be among the world’s top auto companies.

“If I were to guess … probably some company out of China is the most likely to be second to Tesla,” Musk said.

Tesla’s own shares slid in pre-market trade on Thursday, after the company posted earnings that missed expectations and warned of a slowdown in 2024.

BEIJING — Chinese consumer electronics company Xiaomi on Thursday detailed plans to enter China’s oversaturated electric vehicle market and compete with automaker giants Tesla and Porsche with a car model it says it spent more than 10 billion yuan ($1.4 billion) to develop.

The company’s car model, known as Xiaomi SU7, “is in trial production and it will hit the domestic market in a few months,” CEO Lei Jun said in a Tuesday post on the X social media platform, formerly known as Twitter. “The price has not been finalized yet.”

Pronounced “Sue Qi” in Mandarin, the Xiaomi SU7 beats Porsche’s Taycan and Tesla’s Model S on acceleration and other metrics, Lei said during a three-hour presentation on Thursday.

He laid out bold ambitions to become an industry leader, including in autonomous driving and noted that the SU7 design team previously worked at BMW and Mercedes Benz.

Sales are due to begin in 2024, after more than three years of development— during which electric vehicles have taken off in China’s highly competitive market, and domestic automakers have begun to differentiate their products through ambitious offerings of car-compatible tech.

This is an area of potential advantage for Xiaomi, which is best known for its smartphones and home appliances and previously said it wants to create a “‘Human x Car x Home’ smart ecosystem.”

The SU7 is integrated with Xiaomi’s smartphones and internet-connected home appliances, Lei announced Thursday. He emphasized the company’s efforts to ensure data privacy among the devices and create a car that surpasses U.S. safety standards for rear-end collisions.

Lei said the vehicle will also be compatible with Apple’s iPhone, iPad, CarPlay and AirPlay. The U.S. giant has yet to release a car despite widespread speculation of such plans.

Two Xiaomi SU7 models appeared on a list of tax-exempt new energy vehicles published by the Ministry of Industry and Information Technology on Tuesday.

The document described the cars as purely battery powered, with driving range of 628 kilometers (390 miles) to 800 kilometers. The ministry listed a subsidiary of state-owned BAIC Group as the manufacturer for the Xiaomi SU7.

While the car isn’t yet available, Xiaomi has started selling its flagship smartphone and smart watch in the “aqua blue” and “olive oil green” colors of the SU7 sedan.

A price for the SU7 has yet to be revealed, but Lei hinted the purchase would not be cheap and dismissed rumors of a 99,000 yuan or 140,000 yuan price tag.

The Xiaomi car tech event comes as several domestic EV players have recently revealed new electric vehicles.

Nio on Saturday debuted its 800,000 yuan ($113,090) ET9, set to begin deliveries in the first quarter of 2025.Huawei’s Aito brand on Tuesday unveiled its M9 SUV — starting at 469,800 yuan and due to begin mass deliveries in late February 2024.Zeekr, backed by Geely, on Wednesday announced its 007 sedan would start at 209,000 yuan with deliveries beginning on Jan. 1.

Xpeng, which Xiaomi backed in 2019, is set to launch its X9 vehicle on Jan. 1, 2024. Ahead of the Thursday event, Lei shared pictures on popular Chinese social media platform Weibo which showed buildings lit up with messages of Xiaomi saying it salutes BYD, Nio, Xpeng, Li Auto and Huawei.

Xiaomi shares closed 0.25% lower in Hong Kong trading on Thursday. The company’s Hong Kong-traded shares are up by more than 40% so far this year. The business claimed record sales of more than $3 billion across various e-commerce platforms during this year’s Singles Day shopping festival.

Xiaomi has said it expects to spend 20 billion yuan ($2.8 billion) on research on development this year, up by 25% from 2022 and more than double the amount spent in 2020.

MUNICH — You’d be forgiven for thinking that the IAA, one of the world’s biggest motor shows, is actually a technology conference, after tech giants like Amazon, Qualcomm and Samsung all showed up for this year’s event.

Their presence underscores demand for traditional automakers to boost the technology in their vehicles, from software to hardware, as they look to catch up with Tesla in the electric car future. Ramping up technology features is also essential to meet buyer expectations in China.

“Tesla and the Chinese start-ups. This is the two-way force they [traditional automakers] are experiencing, driving them to have more user experience in the car,” Mohit Sharma, automotive research analyst at CCS Insight, told CNBC.

They can’t do it alone. Carmakers are looking at tech firms for help, while also trying to work on items like software in house.

Part of Tesla’s global success has come down to its technology in a number of areas, from batteries to Autopilot — its advanced driver assistance system (ADAS), which uses semi-autonomous driving features. The screen within Tesla cars is also akin to that of a smartphone.

Those features are what rival automakers are trying to build and get ahead on.

There are two major operating systems in the smartphone sphere — Google’s Android and Apple’s iOS. That’s not the case in the car world, when it comes to the ever popular infotainment systems and screens.

Auto firms are now focusing on developing their own operating systems, so that using car screens more closely resembles working with the apps of a smartphone.

To that end, Mercedes-Benz revealed further details at the IAA about its self-developed operating system called MB.OS, which will help power various features from the giant screen across the dashboard to the voice assistant in its upcoming EVs.

Swedish EV player Polestar this year created a joint venture with Xingji Meizu — a smartphone maker owned by Chinese auto giant Geely — and plans to launch its own smartphone in December, when the Polestar 4 car begins delivery to customers. Meizu is making an operating system for Polestar cars based on its own product, called FlyMe. The idea is that users would be able to have a seamless experience between the smartphone and Polestar’s operating system in the company’s cars.

U.S. chipmaker Qualcomm was also in attendance at IAA. The company is making a big push into the automotive space, where its chips can be used to help power artificial intelligence applications within vehicles. One example it showed was a car assistant that could find a recipe for chicken enchiladas and add the ingredients to a shopping list. 

It’s not just about the screen — automakers are also looking into using all parts of the car to display information. BMW said the Neue Klasse EV models it unveiled on Saturday will have what it calls Panoramic Vision, a heads-up display which projects information on the windscreen at the driver’s eyeline.

To make the drive as comfortable as possible, U.S. EV maker Lucid showed off the massage feature of the seats in its Air Midnight Dream Edition car.

A big part of the focus of Tesla technology has surrounded its Autopilot ADAS. No car can operate autonomously — at least from a legal perspective — but automakers are ramping up the driverless features and capabilities.

Tesla is perhaps one of the furthest ahead with its ADAS features, followed by young Chinese players like Xpeng and Nio.

Many automakers aspire to become major players in the world’s biggest and highly competitive electric vehicle market, China. In a bid to differentiate themselves from rivals, Chinese firms have talked up the tech features of their vehicles, from software to ADAS capabilities — and Chinese customers expect the latest tech perks.

“It’s not just good enough to bring a great European design to China, you have to be very, very special about what you offer to the market when it comes to software,” Polestar CEO Thomas Ingenlath, told CNBC in an interview Tuesday.

Heeding that sentiment, foreign companies from BMW to Mercedes are looking to invest heavily in tech development, as they aim to boost EV sales in China.

Volkswagen CEO Oliver Blume on Wednesday said that the company is ramping up its number of software engineers in China.

“We want to operate with China speed in China,” Blume said at the IAA conference.