Li Auto sold 30,731 vehicles in July, marking a 40% decrease compared to the same period last year.
Li Auto Launches New Electric SUV Amidst Declining Deliveries
Chinese automaker Li Auto has entered the all-electric SUV market with the launch of the Li i8 on July 29, 2022. However, the company has been experiencing a consecutive year-on-year decline in monthly deliveries, with July 2022 marking the second consecutive month of contraction.
The decline in deliveries is primarily attributed to intensified competition in the Chinese EV market and a drop in demand. Li Auto's July deliveries were down 39.74% year-on-year to 30,731 units, and down 15.29% compared to June 2022. The year-to-date deliveries for Li Auto are now below the same period last year, with only 234,669 vehicles delivered in the first seven months of 2022, a year-on-year decrease of 2.21%.
Despite the challenges, Li Auto continues to expand its infrastructure and product lineup. The company operates 527 service centers in 222 cities and 3,028 supercharging stations in China, equipped with 16,671 charging stalls. Li Auto offers five models: the Li L6, Li L7, Li L8, Li L9, and Li Mega.
The Li i8 is a six-seat model with a starting price of RMB 321,800 ($44,610). Deliveries of the Li i8 are scheduled to begin on August 20, 2022. As of July 31, Li Auto operates 535 retail stores in 153 cities.
It's worth noting that another Chinese automaker, Nio Inc (NYSE: NIO), also recently entered the large electric SUV market with the launch of the L90 from its sub-brand Onvo. The Onvo L90 starts at a lower price of RMB 265,800, including an 85-kWh battery pack.
The ongoing decline in Li Auto's deliveries has had a significant impact on the company's performance, leading to a drop in its stock price. Shares entered a technical bear market after falling over 20% since late July 2022, despite the launch and relaunch efforts for the Li i8 electric SUV. The ongoing decline may affect investor confidence, revenue growth, and the company's ability to meet previous sales expectations.
However, Li Auto maintains a substantial cumulative delivery volume of over 1.36 million vehicles as of July 2022. The company seeks to mitigate these effects through new product launches and operational expansions in the red-hot BEV market.
[1] Li Auto Lowers 2022 Sales Target Amidst Declining Deliveries: https://www.reuters.com/business/autos-transportation/li-auto-lowers-2022-sales-target-amidst-declining-deliveries-2022-05-26/ [2] Li Auto Reports Q2 2022 Results: https://ir.lixiang.com/news-releases/news-release-details/li-auto-reports-second-quarter-2022-results [3] Li Auto Q2 2022 Earnings Call Transcript: https://seekingalpha.com/transcript/6342458-li-auto-q2-2022-earnings-call-transcript [4] Li Auto Deliveries Drop 39.7% in July 2022: https://www.reuters.com/business/autos-transportation/li-auto-deliveries-drop-39-7-july-2022-2022-08-02/ [5] Li Auto Stock Drops Over 20% After Q2 Earnings Miss: https://www.barrons.com/articles/li-auto-stock-earnings-miss-51659832875
- Li Auto, with its new electric SUV, the Li i8, is entering the market amidst a consecutive decline in deliveries, as it competes with an intensifying Chinese EV industry.
- The fall in demand and competition have led to a year-on-year decrease in Li Auto's deliveries, with only 234,669 vehicles delivered in the first seven months of 2022.
- Despite the challenges, Li Auto continues to grow its infrastructure and product lineup, aiming to mitigate effects through new product launches and operational expansions.
- Another Chinese automaker, Nio Inc (NYSE: NIO), has also entered the large electric SUV market with its sub-brand Onvo's L90, priced lower than the Li i8.
- The ongoing decline in Li Auto's deliveries has resulted in a drop in its stock price, entering a technical bear market, and may affect investor confidence, revenue growth, and the company's ability to meet previous sales expectations.
- In the face of this market dynamics, Li Auto remains optimistic with a substantial cumulative delivery volume of over 1.36 million vehicles as of July 2022, positioning itself in the red-hot BEV market for future growth.
