Xiaomi shares see biggest drop since April after fatal EV crash sparks safety concerns

Chinese tech giant Xiaomi saw its shares fall over 5% on Monday, following reports that the doors of considered one of its electric vehicles did not open after a fiery crash in China that left one person dead.

The stock slid as much as 8.7% in Hong Kong, marking its steepest drop since April, before paring losses after images and video of a burning Xiaomi SU7 sedan in Chengdu circulated on Chinese social media.

Video and eyewitness accounts showed bystanders trying but failing to open the doors of the burning automotive to rescue an occupant. Personnel on the scene eventually used a hearth extinguisher to place out the blaze, local reports said.

Chengdu police said the crash occurred after the SU7 collided with one other sedan, killing a 31-year-old male driver who was suspected of driving drunk.

Xiaomi, which manufactures consumer electronics, software and electric vehicles, didn’t immediately reply to CNBC’s request for comment.

The newest incident follows a fatal SU7 crash earlier this 12 months that raised questions on the vehicle’s smart driving features and sent Xiaomi’s shares tumbling.

The crash could also intensify scrutiny on electronic door handles, a design popularized by Tesla and now common in modern EVs. 

Unlike mechanical models, electronic door handles depend on sensors and electricity and should fail during a hearth or power outage.

China is considering a ban on such electric door handles to deal with safety risks linked to the feature, state-backed media reported in late September.

Meanwhile, the U.S. National Highway Traffic Safety Administration has launched an investigation into about 174,000 Tesla Model Y vehicles after reports of door handle failures.