Company Overview - Li Auto, established on July 1, 2015, is a Chinese manufacturer of new energy smart vehicles headquartered in Shunyi, Beijing, specializing in the design, research, manufacturing, and sales of luxury smart electric vehicles [2] - The company is a pioneer in the commercialization of range-extended electric vehicles in China and was listed on the NASDAQ on July 30, 2020, followed by a secondary listing on the Hong Kong Stock Exchange on August 12, 2021 [2] Supply Chain Management - Li Auto categorizes all suppliers into five categories: strategic suppliers, preferred suppliers, qualified suppliers, limited suppliers, and eliminated suppliers, to enhance the efficiency and precision of supplier management [3] - The company conducts quarterly performance evaluations of suppliers based on quantifiable assessment criteria and regularly updates evaluation standards to improve the standardization and refinement of supply chain management [3] ESG Initiatives - Li Auto incorporates ESG assessments as a key condition for potential supplier admission, evaluating suppliers on professional certifications, compliance, energy conservation, and waste management during the product industrialization development phase [5] - The company has established a supplier exit mechanism for those with significant integrity issues, concealment behaviors, or safety incidents, placing them on an elimination list [5] - In 2024, Li Auto's Changzhou branch and Beijing base received "Green Supply Chain Management Enterprise" certification through optimized green manufacturing and environmental protection supply chain management processes [5] Supplier Quality and Training - In 2024, Li Auto conducted partner empowerment projects through online, offline, and specialized formats, aiming to enhance supplier quality and industrial capabilities, with over 1,000 supplier participations [6] - The company tailored training content based on strategic development needs and supplier quality performance, helping suppliers improve overall quality levels while ensuring a more robust and reliable supply chain [6] - Li Auto performed on-site improvements and capability enhancements for over 10 suppliers, focusing on key management areas such as quality systems, critical characteristics, statistical process control, and production line error-proofing [6] Expert Commentary - Li Auto demonstrates outstanding performance in supply chain responsibility, actively fulfilling its supply chain obligations, with its production base recognized as a national-level green supply chain management enterprise, setting a benchmark for sustainable development in the automotive manufacturing industry [7]

Core Insights - Li Auto has shifted its marketing strategy by signing a brand ambassador, Yi Yangqianxi, which marks a significant change from its previous stance of not hiring celebrity endorsements [2][5] - The launch of the Li Auto i6 is positioned to attract younger consumers, aligning with the brand's new strategic direction [5][9] - The i6 is set to be a key model for Li Auto, with ambitious sales targets and features aimed at enhancing its market competitiveness [6][10] Group 1: Marketing Strategy - The announcement of Yi Yangqianxi as a brand ambassador coincides with the i6's launch, creating a strong buzz and engagement on social media [2][5] - This partnership is expected to leverage Yi Yangqianxi's influence across various age groups, particularly appealing to the Z generation and young adults [5][9] - Previous successful endorsements by Yi Yangqianxi, such as with BMW, indicate his potential impact on Li Auto's brand visibility and sales [6][9] Group 2: Product and Sales Strategy - The Li Auto i6 is positioned as a large five-seat pure electric SUV, priced between 250,000 to 300,000 yuan, featuring advanced technology and spacious design [6][10] - The CEO has set a sales target of 9,000 to 10,000 units per month for the i6, contributing to an overall goal of 18,000 to 20,000 units for all pure electric models [6][10] - Analysts suggest a more aggressive pricing strategy for the i6 to enhance its competitiveness in the market [9]

Core Viewpoint - 2025 is a pivotal year for automotive intelligence, initiating a three-year cycle that will drive domestic electrification penetration rates to achieve a leap of 50%-80%+, reshaping the vehicle landscape [4][12]. Group 1: Industry Trends - The leading intelligent driving manufacturers have successfully implemented urban NOA experiences, including complex scenarios like roundabouts and U-turns, while enhancing high-level functions such as parking and scene understanding [4][12]. - The report includes both large-sample centralized road tests and small-sample in-depth road tests, evaluating the intelligent driving experiences of ten manufacturers, including XPeng, NIO, and Tesla, across various dimensions [5][12]. Group 2: Performance Improvements - Compared to Q1 2025, Q3 2025 saw improvements in intelligent driving capabilities across all manufacturers, with narrowing absolute gaps. The first-tier manufacturers achieved full-scene NOA and continued to optimize user experience [6][12]. - New entrants in self-research have shown impressive intelligent driving performance, with expectations for significant iterations in the next six months, potentially leading to substantial changes in overall experience [7][12]. Group 3: Specific Manufacturer Insights - XPeng, Huawei, and Li Auto remain in the first tier, with XPeng's self-developed Turing chip achieving 2250 TOPS of effective local computing power, enhancing driving logic [7][12]. - NIO and Xiaomi have rapidly caught up to near-first-tier levels, transitioning from "usable" to "well-usable" experiences, with NIO's world model exceeding expectations and Xiaomi enhancing complex scenario handling capabilities [8][12]. Group 4: Road Test Results - XPeng's average total takeover count was 1.51, indicating excellent overall performance, particularly in roundabout capabilities and efficiency [46][49]. - The average takeover count for the Huawei ADS-equipped vehicle was 0.60, with high scores in stability and comfort during driving [50][52]. - Li Auto's average takeover count was 1.47, demonstrating strong performance in roundabout scenarios and overall driving stability [53][56]. - NIO's average takeover count was 2.03, with good performance in roundabouts and a generally smooth driving experience [57][60]. - Xiaomi's average takeover count was 1.94, showing stable performance and the ability to handle complex scenarios effectively [60][62].

Group 1 - The Hong Kong stock market saw mixed performance with the Hang Seng Technology Index slightly down by 0.13%, while the National Enterprises Index rose marginally by 0.01% [2] - The Hang Seng Technology Index experienced a peak increase of 2% during the trading session before closing with a minor decline [2] Group 2 - Major technology stocks generally maintained an upward trend, with Xiaomi rising by 4.48%, JD.com by 3.46%, and Baidu by 2.33% [4] - Automotive stocks collectively increased, with Chery Automobile seeing a significant rise of nearly 14% on its first trading day, while other companies like Li Auto, NIO, and BYD also posted gains [4] - Copper prices surged due to supply tightness following an accident at the world's second-largest copper mine, leading to strong performances in the copper sector, with China Daye Non-Ferrous Metals soaring by 25% [4]

Core Insights - The automotive industry is experiencing a significant performance divergence among companies in the first half of 2025, with some achieving growth in both revenue and net profit, while others face declines in both metrics [1][4]. Revenue and Profit Performance - Among 16 A/H share listed automotive companies, 11 reported revenue growth, and 9 achieved profitability, with over half of the companies being profitable [1][4]. - BYD leads the industry with revenue of 371.281 billion yuan, a year-on-year increase of 23.3%, and a net profit of 15.511 billion yuan, up 13.79% [3][4]. - Traditional automakers like Geely, Great Wall, and SAIC maintained net profits above 6 billion yuan, but all experienced approximately 10% declines in net profit [1][4][5]. - The overall automotive industry revenue reached 509.17 billion yuan, a year-on-year increase of 8%, while costs rose by 9% to 447.8 billion yuan, resulting in a profit of 24.44 billion yuan, up 3.6% [4]. Company-Specific Insights - Geely's revenue grew by 27% to 150.285 billion yuan, but net profit fell by 13.9% to 9.29 billion yuan, attributed to a previous asset sale in 2024 [4][5]. - Great Wall's revenue was 92.335 billion yuan, a slight increase of 0.99%, with net profit declining by 10.21% to 6.337 billion yuan [5]. - Changan, Dongfeng, and GAC faced performance pressures due to challenges in joint ventures, with Changan's revenue down 5.25% to 72.691 billion yuan and net profit down 19.09% to 2.291 billion yuan [5][6][7]. - GAC reported a revenue decline of 7.95% to 42.166 billion yuan and a net loss of 2.538 billion yuan, a significant drop of 267.39% [7]. New Energy Vehicle Collaborations - Companies collaborating with Huawei on the "Five Realms" brand, particularly Seres, have shown significant performance improvements, with Seres achieving a net profit increase of 81.03% to 2.941 billion yuan [8][9]. - Other companies like BAIC Blue Valley and Jianghuai faced challenges, with Jianghuai's revenue down 9.1% to 19.36 billion yuan and a net loss of 777 million yuan, marking a 356.89% decline [9]. Emerging Players Performance - Among the new energy vehicle startups, Li Auto continues to lead with a revenue of 56.17 billion yuan, down 2%, and a net profit of 1.743 billion yuan, up 2.8% [13][14]. - Xpeng and NIO reported revenues of 34.09 billion yuan and 31.043 billion yuan, respectively, with Xpeng showing a significant growth of 132.51% [13][14]. - Leap Motor achieved its first half-year profit of 33 million yuan, while NIO and Xpeng continue to struggle with profitability [13][14]. Market Trends and Future Outlook - The overall market is seeing a shift towards high-end models, with Seres' high-end models leading sales in their respective price segments [8]. - Companies are focusing on cost control and operational efficiency to improve profitability, with NIO implementing a comprehensive cost reduction plan [14].

Investment Rating - The report does not provide specific investment recommendations for individual companies or suppliers in the intelligent driving sector [4][9]. Core Insights - 2025 is identified as a pivotal year for automotive intelligence, with a projected increase in domestic electrification penetration rates to 50%-80% over the next three years, leading to a reshaping of the automotive landscape [4]. - Major intelligent driving manufacturers have successfully implemented complex urban NOA (Navigation on Autopilot) experiences, enhancing high-level functionalities such as parking and scene understanding [4]. - The report evaluates the intelligent driving experiences of ten manufacturers, including XPeng, NIO, and Tesla, through both large sample and small sample road tests, focusing on various dimensions such as scene implementation and comfort [4][9]. Summary by Sections Road Test Overview - The report includes both large sample concentrated road tests and small sample deep road tests to assess the performance of intelligent driving systems [8][27]. - The large sample tests involved approximately 50 participants testing various models along a standardized route, while the small sample tests were conducted by the same evaluators under similar conditions [9][27]. Intelligent Driving Models Tested - The models tested in September 2025 include XPeng P7, NIO ES8, and Tesla Model 3, among others, with specific versions noted for each [10][11]. Performance Evaluation - Compared to Q1 2025, Q3 2025 shows improvements in intelligent driving capabilities across all manufacturers, with a narrowing gap between the leading and following manufacturers [4]. - The report highlights that new entrants in the self-research sector are showing promising performance, with significant iterations expected in the coming months [4]. Specific Model Insights - XPeng's XOS 5.7.7 demonstrated excellent performance with an average takeover frequency of 1.51 times, showcasing strong capabilities in complex scenarios [34]. - The NIO ES8 with cedar model achieved an average takeover frequency of 2.03, indicating robust performance in urban environments [43]. - Tesla's FSD version 13.2 recorded a higher average takeover frequency of 5.73, suggesting areas for improvement in its intelligent driving capabilities [49]. Technical Developments - The report notes advancements in hardware and software across various manufacturers, with many now utilizing self-developed chips and algorithms [26][24]. - Specific improvements in driving comfort and efficiency were reported, with some models achieving significant enhancements in user experience metrics [22].

Core Viewpoint - The incident involving Li Auto's promotional materials featuring military aircraft has sparked significant discussion and led to an investigation by the Aviation Industry Corporation of China (AVIC) regarding potential intellectual property infringement [1][3]. Group 1: Incident Overview - Li Auto released promotional posters during the 2025 Changchun Airshow that included images of military aircraft such as "J-20," "J-10," and "KJ-500," which has drawn public attention [1]. - AVIC has acknowledged the situation and is currently conducting an internal investigation into the matter [1]. Group 2: Legal Actions and Responses - A letter from the China Aviation Industry Cultural Center, dated September 20, demanded that Li Auto cease all infringing activities, remove the promotional content, and issue a public apology for unauthorized use of military aircraft images [3]. - Li Auto confirmed receipt of the letter and stated that it has paused the related promotional activities while initiating communication with AVIC regarding the concerns raised [3][4]. Group 3: Clarifications from Li Auto - Li Auto clarified that the promotional theme "With the Country's Dream, With the Family's Journey" was part of a collaboration with the Changchun Airshow and had been previously discussed with the event organizers [4]. - The company also noted that another image featuring "Li MEGA" was taken with permission from the airshow's operational service provider [4].

Core Viewpoint - Li Auto has addressed concerns regarding its promotional materials for the Changchun Airshow, emphasizing prior communication with the event organizers and the importance of the issue due to its aviation-related context [1] Group 1 - The company received a letter from the "China Aviation Industry Culture Center" questioning the authorization of the promotional theme "Dreaming with the Country, Walking with the Family" [1] - In response to the concerns, Li Auto has suspended related promotions and initiated communication with the "China Aviation Industry Group Co., Ltd. Brand Operation Management Center" and the "China Aviation Industry Culture Center" for verification [1] - The promotional theme in question was part of a collaboration between Li Auto's Changchun sales company and the Changchun Airshow, with prior confirmation from the event organizers [1] Group 2 - The image showing "Li MEGA in front of the main building of the Changchun Airshow" was taken with permission from the event's operational service provider, showcasing the vehicle as a "2025 Changchun Airshow support vehicle" [1] - Li Auto expressed pride in having the Li MEGA featured alongside advanced equipment at the airshow [1] - The company will keep stakeholders updated on any developments regarding this matter [1]

Group 1 - Chery Automobile's stock surged on its first trading day, opening up 11.22% and currently up over 9%, leading the automotive sector in Hong Kong [1] - Other automotive stocks also saw gains, with Leap Motor up 5.8%, Xpeng Motors up 3.4%, and NIO and Geely both rising over 2% [1] - Chery is the second largest domestic passenger car company in China and the 11th largest globally, with a projected 49.4% year-on-year growth in passenger car sales for 2024, the highest growth rate among the top 20 global passenger car companies [1] Group 2 - According to Escalent's research, 47% of buyers are considering purchasing Chinese cars, compared to 44% for American cars; however, this trend is expected to reverse in 2024, with only 31% considering Chinese cars and 51% considering American cars [1]

Core Viewpoint - Li Auto's CEO Li Xiang emphasizes the necessity of advanced driver assistance systems (ADAS) in electric vehicles and advocates for their free usage, positioning the upcoming Li Auto i6 as a leader in smart technology without additional fees [1][3]. Group 1: Product Features and Technology - The Li Auto i6, a new five-seat pure electric SUV, is built on an 800V high-voltage platform, offering a rapid charging capability of 10 minutes for a range of 500 kilometers, with a maximum CLTC range of 720 kilometers [3][4]. - The i6 will feature the AD Max system as standard, reinforcing the company's strategy of making technology accessible to consumers [3]. - The vehicle will utilize a new 5C lithium iron phosphate battery, supporting supercharging and discharging with a peak power exceeding 500 kW [3]. Group 2: Market Position and Competition - The i6 is positioned in a highly competitive segment, facing rivals such as AITO M7, Xiaomi YU7, Tesla Model Y, Xpeng G9, Zeekr 7X, and NIO ES6 [4]. - Li Auto aims to achieve monthly sales of 9,000 to 10,000 units for the i6, contributing to an overall target of 18,000 to 20,000 units per month for its pure electric models [4]. Group 3: Financial and Strategic Insights - Li Auto has committed over 30 billion yuan in R&D over three years, with annual investments exceeding 10 billion yuan starting in 2023, focusing on alleviating range anxiety for electric vehicle users [3][4]. - The company has established over 3,200 supercharging stations, the highest number among Chinese automakers, with plans for continued expansion [3]. - Analysts suggest that Li Auto must balance a 20% gross margin with a monthly sales target of 20,000 units, highlighting the importance of aggressive pricing and immediate delivery for higher-end versions [4].