China’s Automotive Development Report

“Li Auto “is a unique player in China’s new energy vehicle market. Since its founding in 2015 by Li Xiang, the company has consistently focused on creating mobile, warm spaces for family users. Its development history, while not long, has been clear and steady. The company started under the name “Che he jia” （it means “auto and home”）and was officially renamed “Li Auto” in 2019, delivering its first mass-produced model, the Leading Ideal ONE, that same year. This family-oriented, six-seat luxury SUV, with its innovative extended-range electric solution, accurately addressed users’ range anxiety and became an instant hit, laying a solid market foundation for the brand. In 2020, Leading Ideal successfully listed on NASDAQ, gaining a broader platform for development. It subsequently entered a period of rapid expansion, transitioning successfully from a single product to a diversified product matrix and becoming one of the first domestic new automakers to achieve profitability, demonstrating exceptional operational efficiency.

In terms of brand architecture, Leading Ideal currently does not have complex sub-brands but instead concentrates all its resources under the single main brand of “Li Auto,” committed to making it synonymous with “family luxury and new energy.” The evolution of its product line clearly reflects this strategy. The pioneering Leading Ideal ONE paved the way, while the current core pillars are the L series. This series includes three extended-range electric SUVs: the Leading Ideal L9, L8, and L7. They function like a close-knit family, highly unified in exterior design, intelligent cabin, and comfort features, primarily differentiating themselves through size and seating layout to precisely cover various segments from multi-generational families to new-generation nuclear families. To explore a pure electric future, Leading Ideal also launched the iconic Leading Ideal MEGA, a full-size, high-end pure electric MPV that aims to redefine the next era of family travel with its forward-looking design and top-tier technological features.

Li Auto has an extremely clear profile of its target customers: the “creator” families of modern Chinese society. These users are predominantly aged 30 to 45, with strong educational backgrounds and stable, high incomes, living in central cities. Their core decision-making factor when buying a car is their family, not themselves; they place extreme importance on the comfort and safety of every passenger and pursue the perfect integration of space, intelligence, and quality. Whether it’s the “dad-mobile” attributes of the L series or the MEGA’s interpretation of top-tier luxury travel, they perfectly meet these users’ deep need for a “versatile” vehicle that balances daily commuting, weekend leisure, and long-distance trips.

After years of accumulation,Li Auto has grown into a leading enterprise among domestic new automakers. The group employs tens of thousands of people globally and has built a complete system covering R&D, manufacturing, sales, and service. Its self-owned intelligent manufacturing bases ensure product quality and supply chain reliability. Financially, Li Auto was one of the first new brands to achieve sustained profitability, providing a solid foundation for its long-term development. While consolidating its domestic market position, Li Auto is gradually turning its vision to the global stage. Its overseas expansion strategy is cautious and focused, currently targeting developed markets like Europe as a bridgehead. For instance, it has begun selling models like the Leading Ideal L9 in countries such as Norway. By establishing sales and service networks through partnerships with local dealers, it has taken its first step in internationalization. The launch of the pure electric MEGA is also seen as a significant signal of its intent to enter broader global markets in the future. Although its overseas business is still in its early stages, it marks Li Auto’s steady transformation from a successful local brand into an automotive company with global influence.

https://www.liauto.com

In the global automotive industry’s shift towards electrification, the Chinese market is undoubtedly at the forefront. It has not only fostered the world’s largest new energy vehicle consumer market but also given rise to a group of highly innovative and internationally competitive brands. Starting from different paths, they have collectively shaped today’s spectacular scene of “vying for supremacy.”

To understand the current landscape, BYD is a starting point that cannot be overlooked. As a company that started with battery technology and grew into a global new energy vehicle giant, BYD’s success is no accident. By mastering core technologies across the entire industry chain—particularly the “three electrics” (battery, motor, electronic control)—it has built a formidable moat. From the mass-market “Dynasty” series (Han, Tang, Song, Qin) to the more youth-oriented “Ocean” series (Dolphin, Seal), BYD’s product matrix covers almost all mainstream price segments. Its annual sales exceeding 3 million units in 2023 not only demonstrate broad market acceptance but also cement its leadership position in China and globally.

While BYD swept the market with a stance of “technology for all,” a group of new automakers established around 2014 chose to enter the fray with a focus on premiumization and differentiation. Among them, NIO, Li Auto, and XPeng, collectively known as “Wei Xiao Li,” each carved out their own unique niches.

From its inception, NIO has been committed to redefining the relationship between users and the company. It aims to build not just a high-performance intelligent electric vehicle but also an refined community and service ecosystem built around the user. Its signature battery-swapping model offers a unique solution to range anxiety. From the elegant ET series sedans to the comfortable ES series SUVs, NIO has consistently maintained its position as a premium brand.

Li Auto demonstrates a profound understanding of the needs of Chinese family users. It astutely capitalized on the current practicality of the extended-range electric vehicle (EREV) technology, cleverly addressing range anxiety associated with pure electric vehicles. From the Li ONE to the L series (L9, L8, L7), its products are uniformly centered around spacious interiors, luxurious features, and excellent family entertainment functions, making it synonymous with the “dad mobile” category and achieving tremendous commercial success as a result.

XPeng has embedded “intelligence” into its brand DNA. It is often regarded as the “Tesla of China,” with continuous R&D investment in intelligent driver-assistance systems and smart cockpits. Its signature Navigation Guided Pilot (NGP) function showcases deep accumulation in autonomous driving technology, attracting many young users who seek cutting-edge tech. From the classic P7 coupe to the tech-laden G9 SUV, XPeng’s products consistently revolve around the technological experience.

Beyond these startups, traditional automotive giants have also incubated their own new energy contenders. Geely launched the premium electric brand Zeekr. Leveraging Geely’s Sustainable Experience Architecture (SEA), Zeekr’s first model, the 001, gained instant fame with its unique shooting brake design and exceptional performance. Subsequent models like the luxury MPV 009 and compact SUV X have continued its avant-garde, unconventional design language.

GAC Group’s Aion brand successfully charted a path from the business-to-business (B2B) market to penetrating the consumer market. After initially accumulating significant data and reputation through the ride-hailing sector, Aion rapidly gained traction in the private passenger vehicle market with highly cost-effective models like the Aion S and Aion Y, seeing steady sales growth and becoming a force to be reckoned with, particularly in southern China.

In the last two years, the biggest variable in the market has come from the cross-border entry of tech giants. The AITO brand, jointly created by Seres and Huawei, is a prime example of the “Huawei Inside” model. Huawei not only provides leading “three electrics” technology, the disruptive HarmonyOS smart cockpit, and advanced intelligent driving systems but also participates deeply in product definition, design, and channel sales. The explosive popularity of the AITO M7 vividly demonstrates the immense market appeal powered by Huawei’s brand and technological prowess.

Similarly, Xiaomi, a giant in the consumer electronics field, announced its car-making plans in 2021 and launched its first model, the Xiaomi SU7, in 2024. Xiaomi positions its greatest advantage in the “Human x Car x Home” full ecosystem connectivity, attempting to replicate its success in smartphones and smart homes within the automotive industry. Its entry adds another layer of intrigue to an already fiercely competitive landscape.

Furthermore, the Avatr brand, a joint venture between Changan Automobile, Huawei, and CATL, represents another “all-star” collaboration model, combining the strengths of its three parent companies to focus on the premium emotional intelligent electric vehicle segment.

In summary, the Chinese EV market has formed a dynamic structure: BYD stands as the “superpower,” “Wei Xiao Li,” Zeekr, Aion, and others constitute the “major powers,” while tech giants like Huawei and Xiaomi continuously inject new variables. It is a battleground where technological iteration is unprecedentedly fast, consumer demands are increasingly diverse, and competition is fiercely brutal. Yet, precisely this environment makes it the most active frontier of innovation in the global automotive industry. The future of mobility will undoubtedly be shaped by the players here.

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