By Jiahui Huang
Li Auto cut guidance for first-quarter car sales after its chief executive acknowledged missteps in the rollout strategy for its first fully electric car.
The Chinese electric-vehicle maker on Thursday guided for deliveries of 76,000 to 78,000 vehicles in the first quarter, down from its previous outlook for 100,000 to 103,000 vehicles, after taking into account a lower-than-expected order intake so far this year.
The company's shares have been battered by disappointing sales for the fully electric MEGA model, which was introduced March 1.
Li Auto's Hong Kong-listed shares have slumped 24% since the MEGA launch, and are down 8.2% year to date. Its American depositary receipts fell 7.3% in premarket trading on Thursday.
MEGA was launched at a price tag of 559,800 yuan ($77,759), higher than analysts had expected, into China's overcrowded EV market. As competition intensifies, Li Auto's rivals, including BYD, Tesla, XPeng and NIO, have stepped up a price war, cutting prices and offering discounts and other incentives.
"We want to acknowledge that the operating strategy of Li MEGA was mis-paced," said Xiang Li, Li Auto chairman and CEO, in a filing.
The CEO said the company will focus on its core customer base and target cities with stronger purchasing power for its next move.
The MEGA model is the first foray by Li Auto, a plug-in hybrid EV specialist, into the fully electric segment.
However, despite the lack of enthusiasm over MEGA, Nomura analyst Joel Ying said Li Auto will still rely on its bread-and-butter plug-in hybrid car models to make up the bulk of its annual sales target.
"The sales of MEGA shouldn't have much impact on the company's sales and revenue," Ying said.
Write to Jiahui Huang at jiahui.huang@wsj.com
(END) Dow Jones Newswires
03-21-24 0619ET
