---
title: "Li Xiang is saving Li Auto"
type: "News"
locale: "zh-HK"
url: "https://longbridge.com/zh-HK/news/200478822.md"
description: "Staying steady can still lead to victory"
datetime: "2024-03-22T14:20:01.000Z"
locales:
  - [zh-CN](https://longbridge.com/zh-CN/news/200478822.md)
  - [en](https://longbridge.com/en/news/200478822.md)
  - [zh-HK](https://longbridge.com/zh-HK/news/200478822.md)
---

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# Li Xiang is saving Li Auto

The aftermath of MEGA's listing continues to affect Li Auto.

On March 22, Li Auto's Hong Kong stock price fell by about 11%. A day earlier, Li Auto announced that due to lower-than-expected orders, the first-quarter delivery guidance would be reduced to 76,000-78,000 units, a 24% decrease from the expected 100,000-103,000 units. Since MEGA's listing in early March, Li Auto's market value has evaporated by nearly 40%, about HKD 122 billion.

The decline in first-quarter delivery guidance is closely related to MEGA. Insiders close to Li Auto stated that due to internal misjudgment of MEGA's pace, a large amount of sales resources were misallocated, directly disrupting the entire company's product matrix layout.

On March 21, Chairman Li Xiang sent an internal memo admitting the mistakes made with MEGA, acknowledging that it was due to his excessive pursuit of sales volume and desires.

At the end of June last year, Li Xiang publicly stated that by 2025, he aimed to achieve a strategic goal of 1.6 million units and 500 billion in revenue, to be verified by early 2026. It now appears that Li Xiang's high-growth dream is likely to be shattered, as he overestimated himself.

"We have been overly focused on sales volume and competition from top to bottom, allowing desires to surpass value, significantly reducing our user value and operational efficiency. Pursuing desires has turned us into people we hate." Li Xiang said in the internal memo.

Facing the current situation, Li Xiang did not blame others but quickly reviewed the situation to find a way out.

Insiders close to Li Xiang revealed, "In Q4 last year, we pushed for 50,000 units through promotions. Now internally, we are considering what to do and how to meet user demands. There is ongoing reflection internally, without blaming others."

After asking himself some tough questions, Li Xiang decided to prioritize operational efficiency, lay a solid foundation, and avoid bigger problems in the future.

An insider at Li Auto said, "We have given up some sales volume, and in terms of profit, we aim to surpass last year's full year (Q1 overall gross margin maintained at 20%, the annual gross margin plan is still greater than 20%). Li Auto hopes that the operational quality this year will improve, otherwise, even if sales increase this year, more problems will arise next year.

According to individuals close to Li Auto, after the downward adjustment in first-quarter expectations, Li Auto's initial target of 650,000-800,000 units for this year has also been reduced, with the annual sales growth rate reset to 50%-70%, corresponding to a guidance of 560,000-640,000 units.

As for the potential supply chain cost fluctuations due to the expected decline, individuals close to Li Auto revealed that they have already communicated with suppliers. "In fact, the market did not fully believe in the expectation of 800,000 units, and both the supply chain and investors have a consistent expectation of around 600,000 units." Next, Li Xiang chose to refocus on the L series, stabilize the market demand for extended-range vehicles, and defend its main position with all its might.

Internal sources at Li Auto said that with the recent focus on the L series in publicity and operations, the growth rate of Li Auto can return to the right track.

This year, Li Auto's L6, which is tasked with achieving sales targets, is ready to debut around the time of the Beijing Auto Show. As a product that has emerged from a mature system, Li Auto is very confident in it, with internal expectations that monthly sales of the L6 can stabilize at 20,000 units.

Regarding how to save MEGA, internal sources mentioned that the peak of public opinion pressure has passed, and there will be strengthened marketing efforts in the future, believing that the situation will improve. Li Xiang also stated that MEGA will patiently start from scratch and abandon the strategy of widespread sales, focusing on core user groups and cities with strong consumption power for high-end pure electric vehicles.

However, Li Auto is not willing to lower the price of MEGA in exchange for sales volume, still wanting to maintain its positioning as a luxury brand.

Internal sources at Li Auto revealed that currently, MEGA's NPS (Net Promoter Score) is good, which is crucial for the future growth of the vehicle. They estimate that MEGA can achieve an average of 2,000 units per month this year, with a chance to peak at 4,000-5,000 units by the end of the year, but the trend in the third quarter still needs to be observed.

The adjustment of the MEGA strategy will inevitably affect Li Auto's pure electric strategy planning.

Someone close to Li Auto pointed out that the theory of the urgent need for charging piles was the biggest misjudgment before. Li Auto has revised its previous charging pile layout plan to 10,000 in cities and 3,000 on highways. In addition, Li Auto is also considering whether pure electric and extended-range vehicles need to be separated into two systems in the future.

From the arrogance of last year to the mature and steady reassessment now, the defeat of MEGA may not be a bad thing for Li Xiang.

"We need to pragmatically solve problems, which is a good warning and opportunity for the organization," a Li Auto employee told Wall Street News, which is the best example of learning from Huawei at Li Auto. "Since its inception, every model of Li Auto has encountered problems to a greater or lesser extent, and the reassessment has covered hundreds of people, which is rare in other companies."

Previously, Liu Jie, Vice President of Business at Li Auto, told Wall Street News that Huawei has the terrifying ability to quickly reassess, accumulate, and learn from the outside world.

After painful reflection, the market hopes that Li Xiang can be humble and regain the qualities of an excellent product manager. This can also help Li Auto to continue to grow healthily and lay a more solid foundation for the future.

After all, in an environment where strong competitors surround them, gaining the trust of consumers and investors requires no room for error at any level

### 相關股票

- [Li Auto (LI.US)](https://longbridge.com/zh-HK/quote/LI.US.md)

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