Li Auto L6 Render (Source: Sugar Design)
Li Auto is set to launch its first below 300,000 RMB vehicle, the Li Auto L6. The Li Auto L6 is yet another Chinese mass-market SUV challenger to the Model Y and the Huawei-backed AITO M7. The L6 is expected to start at 249,800 RMB or even lower due to the current market condition. At this price, the L6 will for the first time directly target the Tesla Model Y, which is priced at 263,900 RMB.
Li Auto recently re-adjusted its annual guidance from 650,000 - 800,000 vehicles to between 560,000 - 640,000 due to lower-than-expected order intake of its L-series and the new MEGA MPV.
Direct Response to AITO and Tesla
The Li Auto L7 sales have trailed the AITO M7 since the start of 2024, partly due to the latter being an equally potent EREV SUV with dimensions falling in between the L7/L8 with a starting price nearly 50k below the L7. In week 5 of 2024, AITO M7 even outsold the Tesla Model Y. The L6 will level the field at a price point that is comparable to the M7 and Model Y and Li Auto expects monthly sales of 30,000.
New Model, Same Design
Li Auto L6 (Source: Yiche)
The Li Auto L6 is a scaled-down version of the L7, featuring the family design front face, panoramic sunroof, and hidden door handles - all proportionately scaled down from the L7. However, subtle differences can be seen, such as a slight adjustment to the continuous light strip on the front face, making it finer and longer. Additionally, the integration of the L6's lidar appears to be more "integrated" across the roof than the L7's more "bulky" appearance. To reduce costs, the L6 may be the first model adopting an LFP battery and a single motor.
New Target is Much More Realistic
As most of us know, the automotive industry is highly seasonal and in China especially, the first quarter is further impacted by the Chinese New Year. For this reason, falling behind annual target sales in the first half of the year is largely expected. However, comparing Li Auto to other automakers and their respective targets gives a fuller picture.
For example, Li Auto has sold 80,401 vehicles as of March 31, 2024, which is only second to AITO's 83,723 units sold. Both are behind schedule by 42-44% which is in line with other brands.
XPeng is falling behind
XPeng has struggled significantly in Q1-24, mainly due to the amount of competition bolstered by an aggressive price war in China. New model launches such as the BYD Song L have dramatically hurt the mass market model XPeng G6. Recent vehicles such as the ZEEKR 007 and the Xiaomi SU7 further hamper demand for its once-popular XPeng P7 sedan model. XPeng is now 68.8%, or 48.2k units behind its sales target of 280,000.