Core Insights - The automotive industry is experiencing a clash between two opposing strategies: "de-Huawei" and "embracing Huawei" as exemplified by recent executive movements and management style shifts within companies like Li Auto and Avita [1][12][13] Group 1: Executive Movements - Sun Baigong, a senior executive with experience at both Huawei and Li Auto, has joined Avita as the GTM (Go-To-Market) head, overseeing product launch strategies and global market expansion [1][3] - Sun's background includes significant roles at Huawei, where he contributed to the independent branding and globalization of the Honor brand, showcasing his dual expertise in technology and automotive sectors [3][5] Group 2: Management Style Shifts - Li Auto has transitioned from a rigid PBC performance management system to a more flexible OKR system, reflecting a need for better collaboration and innovation amidst pressures for short-term performance [5][9] - The shift in management style at Li Auto is part of a broader trend where several Huawei-affiliated executives have left the company, indicating a strategic pivot away from Huawei's influence [5][12] Group 3: Avita's Strategic Positioning - Avita has submitted its IPO application to the Hong Kong Stock Exchange, aiming to become the first state-owned new energy vehicle company listed in Hong Kong, with projected revenue growth of 169% in 2024 [9][12] - The company plans to enter 50 countries and regions by 2026, and Sun's experience in market expansion aligns with this ambitious international strategy [9][12] Group 4: Industry Trends - The automotive sector is clearly dividing into two camps: one represented by Li Auto, which seeks to establish an independent decision-making framework, and the other by Avita, which aims to leverage Huawei's technological ecosystem for competitive advantage [12][13] - This strategic divergence highlights the ongoing adjustments companies must make in response to intensifying competition within the automotive industry [13]

Core Viewpoint - Li Auto is restructuring its sales and service system to enhance operational efficiency and support frontline sales personnel, moving away from the previously implemented five-region sales strategy [3][4][6]. Group 1: Organizational Changes - Li Auto has merged its five sales regions into a centralized "Sales Department" managed directly from headquarters, now overseeing 23 regions [2][3]. - The company has established two new departments within the sales and service sector: marketing and sales operations, to better allocate resources [2][3]. - The return to a "provincial leader system" aims to improve user operations centered around stores, addressing internal conflicts that arose from the previous structure [3][4]. Group 2: Performance Challenges - Li Auto's sales volume has declined by 24% in the first half of the year, ending a 14-month streak of year-on-year growth, and has been surpassed by competitors [6]. - The market share of Li Auto's high-end models (L7/L8/L9) has decreased from 32% to 26% compared to the previous year, with the entry-level L6 model now accounting for over 40% of sales [6]. - The company's net profit fell by 81.7% quarter-on-quarter in the first quarter, highlighting the urgent need for new growth points in the pure electric vehicle market [6]. Group 3: Strategic Adjustments - Li Auto is shifting from a performance-based management system (PBC) to an Objectives and Key Results (OKR) model, which is more suited for innovation and exploration [7]. - This change is intended to foster a more adaptive organization capable of navigating the uncertainties in technology and AI-driven markets [7]. - The company aims to leverage its i-series and AI strategies to regain competitive advantage and drive growth in the pure electric vehicle segment [6][8].

Core Viewpoint - Li Auto's first pure electric SUV, the i8, was launched after a year of delays, but the market response was negative, with a significant drop in stock price following the launch event [2][13]. Group 1: Product Launch and Market Response - The i8 was introduced at a large-scale event in Beijing, marking the company's largest venue and audience for a product launch [2]. - Despite the ambitious launch, the stock price fell over 13% the next day, resulting in a market value loss of over 30 billion HKD [2]. - Internal expectations for the i8's sales are low, with projections of only a few thousand units for the year [2]. Group 2: Strategic Shift - Li Auto is undergoing a strategic transformation to address market saturation and competition, moving away from its previous successful formula [2][13]. - The company aims to position itself as a technology giant, with the i8 serving as a key vehicle for its AI ambitions [7]. Group 3: Product Features and AI Integration - The i8 is designed to combine the comfort of an MPV, the off-road capability of an SUV, and the driving experience of a sedan, targeting family users [3]. - The vehicle features dual intelligent systems, VLA driver model and Li Xiang MindGPT, enhancing its autonomous driving capabilities and user interaction [5][6]. Group 4: Historical Context and Challenges - The i8's development faced delays due to previous product issues and market challenges, leading to significant costs for redesign [9][10]. - Li Auto's sales growth has recently stalled, with a 24% decline in total sales in the first half of the year, and a drop in market share from 32% to 26% [13]. Group 5: Organizational Changes and Management Strategy - Following a review of past strategies, Li Auto is shifting from a performance-based management model to an OKR (Objectives and Key Results) approach to foster innovation [15][18]. - The company aims to refocus on user needs and develop products that address unmet demands in the market [19].