Li Auto purchases plot of land in Chongqing for capacity expansion, targets to sell 1.6M vehicles
Li Auto has purchased a large plot of land in in the southwestern Chinese city in order to prepare for an aggressive capacity expansion wherein it targets to sell 1.6M vehicles by 2025, as reported by CNEVPost.com.
The site which is 1.13M sq. meters is larger than Tesla’s Giga Shanghai was purchased for $67.6M.
Giga Shanghai is expected to top 1M units a year in the next few years, Cailian said earlier this month, citing people familiar with the matter.
The deal was made on Jan.27, 2022 and the buyer (Chongqing Chezhiyu Automotive Industry) can use the land for 50 years.
Chezhiyu was established on Dec. 9, 2021, with a registered capital of RMB 160M and is 100% owned by Li Auto.
Currently, the company has a plant in Changzhou, Jiangsu province with an annual capacity of 100K units; it delivered 90,491 vehicles for FY21 which is the top end of its capacity.
In January 2022, Li Auto delivered 128.1% Y/Y increase in January deliveries, but it is down 12.9% from December 2021 deliveries.
Li Auto signed a strategic cooperation framework agreement with the Chongqing municipal government on Dec. 15, pledging to increase investment in the city.
Author: Khyathi Dalal, Seeking Alpha