Chinese electric vehicle maker Li Auto now expects its deliveries for the third quarter of 2022 to total around 25,500 units, significantly lower than previous forecasts, the company stated on September 26. In its second-quarter financial report, the firm’s expected total deliveries were between 27,000 and 29,000 units, indicating that the third-quarter figure may be 5.6% below the lowest expectation.
Compared with its competitors, Li Auto‘s original third-quarter delivery target was relatively conservative. NIO is targeting 31,000 to 33,000 deliveries in the third quarter – its highest quarterly target ever. Meanwhile, XPeng is expected to deliver 29,000 to 31,000 vehicles in the third quarter, up 13% to 20.8% year on year.
In terms of sales volume, Li Auto has encountered great challenges recently. In August, its delivery volume was only 4,571 units, which was more than 50% lower than that of the previous year and the previous month. It was not only far behind XPeng and NIO, but it was also surpassed by up-and-coming NETA Auto and Leapmotor.
In July and August this year, the cumulative deliveries of Li Auto reached 15,000 units. Based on the latest third-quarter delivery estimates, it expected to deliver about 10,500 vehicles in September, the same level as July.
Li Auto‘s poor sales performance is closely related to its model iteration. Since the launch of the L9, sales of the Li ONE have been squeezed. During a second-quarter earnings call, firm representatives said that orders for the Li ONE were growing slowly, which is also in line with industry expectations, whereby it is common for sales of older models to suffer after the launch of new models.
Soon after, however, Li Auto revealed that a replacement for the Li ONE, the L8, would soon be released. According to the latest announcement, the L8 will be unveiled at a launch event on September 30, with deliveries officially starting in early November.
The Li ONE has ushered in a suspension. At the beginning of September, a price reduction worth 20,000 yuan ($2,790) was launched for the promotion of the Li ONE with a price tag of 349,800 yuan ($48,816).
Sudden sales promotion and production suspension have triggered complaints from a large number of Li ONE owners, which has in turn had a great impact on the EV maker’s brand and reputation.
In response to complaints, Li Auto announced after-sales instructions for Li ONE owners. The company will guarantee to supply the original parts for no less than 12 years and to provide OTA upgrade services. Owners can also enjoy the same after-sales services as buyers of the new model, and lifetime warranty buyers’ rights will not be affected.
The company attributed the reduction in its third-quarter delivery forecast to supply chain constraints and affirmed that it will continue to work closely with its supply chain partners to resolve supply bottlenecks and accelerate production.
The delivery of the L9 model has previously been delayed due to supply chain problems. In late August, the L9 suffered delivery delays due to power shortages in Sichuan. During the second-quarter earnings call, Li Xiang, CEO of Li Auto, said the company would deliver more than 10,000 L9s in September.