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Shares of the Chinese tech giant Xiaomi slumped after the company said one of its SU7 electric vehicles was involved in a "serious traffic accident" on Saturday night.

Shares of Hong Kong-listed Xiaomi plunged sharply to a six-week low following the Weibo post. Xiaomi closed 5.5% lower at 46.50 Hong Kong dollars per share on Tuesday, underperforming gains of 0.4% in the Hang Seng Index.

Xiaomi's share price is still 35% higher this year following a rush into Chinese tech stocks thanks to the hype in Chinese AI model DeepSeek.

A Xiaomi spokesperson wrote on Weibo on Tuesday that the accident occurred along the Deshang Expressway in eastern China.

Initial information showed the car was in the Navigate on Autopilot, or NOA, intelligent-assisted driving mode before the accident and was moving at 116 kilometers per hour, or 72 miles per hour, Xiaomi wrote on Weibo.

The vehicle detected an obstacle and slowed down before a human driver took over. It collided with a cement barrier a few seconds later, the company wrote.

More than nine minutes after the NOA mode was activated, the car sent out an alert for the driver to hold the steering wheel.

Local media reported that three people died in the accident, and news of the accident became a trending topic on Weibo.

The cause of the accident was not immediately clear. Xiaomi did not provide details about injuries or fatalities in its post. The company did not immediately respond to a request for comment from Business Insider.

Xiaomi said in its post that it's cooperating with the police on investigations.

The accident poses a potential setback for Xiaomi, which has made waves in the EV space.

Last year, Xiaomi set a goal of selling 100,000 SU7s by year-end. It surpassed that sales target in November.

It raised its 2025 sales target to 350,000 units, up from its previous target of 300,000 units.

In October, Ford CEO Jim Farley said he was a fan of the Xiaomi SU 7, describing the car as "fantastic."

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