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.

Xiaomi's Hong Kong-listed shares soared eight per cent at one point before paring their gains but ending at a record high.

Xiaomi has thrown down the gauntlet with its latest product debut in the electric vehicle industry. On Thursday, the company revealed that it had received nearly 300,000 orders for its new YU7 electric SUV within just one hour of its launch.