The company delivered a quarterly record of 17,575 vehicles in Q2 and is targeting lower-tier cities to expand its retail network.
Electric vehicle company Li Auto generated RMB 5.04 billion (USD 780.4 million) in total revenues for Q2 2021, up 40.9% year-on-year and in line with market expectations of RMB 5.01 billion (USD 774.8 million), according to the company’s latest financial results released on Monday.
Li Auto delivered a quarterly record of 17,575 Li One vehicles during the June quarter, an increase of 166.1% YoY, while the company’s vehicle margin improved to 18.7% from Q2 2020’s 16.9%. Chinese EV startups are racing to scale their businesses, and Li Auto’s delivery volume in Q2 2021 was just ahead of Xpeng Motors but behind Nio’s some 21,000 vehicles delivered during the quarter. Li Auto recorded a net loss of RMB 235.5 million (USD 36.4 million) during the June quarter, which is down from the previous quarter’s RMB 360 million (USD 55.7 million).
The Beijing-based EV company is intent on ramping up production at its manufacturing facilities in Cangzhou, Jiangsu province, following the completion of a USD 1.5 billion IPO on the Hong Kong Stock Exchange. For Q3 2021, the company is targeting between 25,000 and 26,000 vehicle deliveries but acknowledged to investors on the earnings call that the global semiconductor shortage could disrupt these forecasts.
“The industry-wide semiconductor shortage has affected our monthly deliveries in recent months, resulting in an undelivered backlog. As our new order exceeded 10,000 in June, we tried our best to utilize alternative solutions to enhance our flexibility and acquire industry sources,” said Li Auto’s president, Kevin Shen. “Going forward, we’ll continue to collaborate closely with our supply chain partners to mitigate the semiconductor shortage and minimize the impact on our production.”
During the June quarter, Li Auto expanded its network of physical sales and service stores to include 109 retail locations across 67 cities, as well as 176 service centers in 134 cities. The company has emphasized expanding operations in China’s lower-tier cities, targeting a total of 200 total retail stores by the end of the year.
Currently, Li Auto only offers one vehicle model, its flagship Li One, but expects to debut two new models by the end of 2023, Shen revealed on the earnings call. In the future, Li Auto wants its EVs to cover a price range from RMB 200,000 to RMB 500,000 (USD 30,900–77,300). Li Auto’s share price fell by 1.06% to USD 29.03 during Monday trading following the earnings announcement.
Author: AJ Cortese, Kr-Asia