Following tragic incident: Xiaomi initiates widespread product recall
In a recent development, Chinese tech giant Xiaomi has announced the recall of over 100,000 SU7 models due to potential issues with the driver assistance system. This move comes after a fatal accident earlier this year, resulting in three deaths while the vehicle was in autopilot mode.
The Chinese market authority has stated that the driver assistance system may not respond adequately in critical situations. However, it's worth noting that the standard version of the SU7 does not have lidar sensors, unlike many competitors.
The recall is crucial to prevent more accidents from occurring. Xiaomi has assured that no costly mechanical intervention is likely needed for the software update, as it can be done via an over-the-air update. The affected SU7 models were produced between February and August 2024.
Despite this setback, Xiaomi has delivered over 305,000 vehicles by July, making it one of the top performers with a 64 percent annual gain. The stock of Xiaomi has recovered and is nearing its record high after a significant drop caused by the fatal accident.
Xiaomi has also announced a software update to optimize speed adjustment in complex situations like rain or darkness. This update aims to improve safety in Xiaomi's driver assistance system, making it more responsive in critical situations.
The positive environment in China and Xiaomi's continued course should continue to benefit investors. In fact, Xiaomi's stock has been part of the DEPOT 2030 of the Hot Stock Report since 2023 and has since gained an impressive 350 percent.
It's important to note that similar recalls happen regularly among other manufacturers, highlighting the challenges in developing and maintaining complex driver assistance systems.
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Despite the recall, shareholders remain on board with Xiaomi. In fact, AKTIONÄR readers have benefited, gaining around 15 percent from Xiaomi stocks. It's a testament to the faith investors have in Xiaomi's ability to navigate through challenges and continue its growth trajectory.
However, it's worth mentioning that shares of Xiaomi are held in a real portfolio of the Boersenmedien AG, which could potentially be a conflict of interest.
In conclusion, while the recall is a significant event, it doesn't seem to have deterred investors from Xiaomi. The company's impressive growth, coupled with its commitment to improving safety in its driver assistance system, suggests that it remains a compelling investment option for many.
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