Li Auto Inc. (NASDAQ:LI) is among the Goldman Sachs EV and Battery Stocks. On February 9, 2026, JPMorgan cut Li Auto Inc. (NASDAQ:LI) to Underweight from Neutral and reduced its price objective to $14 from $18. The corporation forecasts China’s auto industry to underperform in 2026 as passenger vehicle growth slows. JPMorgan downgraded Li Auto Inc. (NASDAQ:LI)’s profitability prediction for this year to a loss, noting lower sales volumes and margins, as well as a shortage of new models. Separately, the ...

Core Insights - China's vehicle sales and production reached record highs in 2025, with production at 34.5 million units (up 10.4% year over year) and sales at 34.4 million units (up 9.4% year over year), driven by strong demand for new energy vehicles (NEVs) [2][4] Group 1: Market Performance - In 2025, China's passenger vehicle market also crossed the 30-million-unit mark, with production at 30.27 million units (up 10.2% year over year) and sales at 30.10 million units (up 9.2% year over year) [3] - The commercial vehicle segment saw production and sales rise to 4.26 million and 4.30 million units, both achieving double-digit growth [3] - China maintained its position as the world's largest auto market for the 17th consecutive year [4] Group 2: NEVs and Export Growth - China remained the largest NEV market globally for the 11th consecutive year in 2025, with NEV production and sales surpassing 16 million units [5] - NEV sales increased by 28% year over year to 16.5 million units, with battery electric vehicles (BEVs) leading the growth at 10.6 million units (up 37.6%) and plug-in hybrid vehicles (PHEVs) reaching 5.8 million units (up 14%) [6] - Vehicle exports reached a record 7.1 million units, up 21% year over year, driven by improved product quality and competitive pricing [7] Group 3: Key Players - BYD led in volume with approximately 4.6 million vehicles delivered in 2025, marking a 7.7% year-over-year increase [9] - NIO delivered 326,028 vehicles, up nearly 47% year over year, while XPeng recorded the fastest growth with deliveries jumping 126% to 429,445 units [10] - Li Auto delivered 406,343 vehicles, reflecting a 19% year-over-year decrease, despite expanding its international presence [11] Group 4: Future Outlook - Growth in China's auto market is expected to moderate in 2026, with total vehicle sales forecasted to increase by just 1% to 34.8 million units, compared to a 9% rise in 2025 [17] - Passenger vehicle sales are projected to rise 0.5% to 30.3 million units, while commercial vehicle sales are expected to increase by 5% to 4.5 million units [18] - NEVs are anticipated to remain the main growth driver, with sales forecasted to rise 15% to 19 million units, albeit at a slower pace than in recent years [18]

Core Insights - NIO, XPeng, and Li Auto, major players in the China-based smart electric vehicle market, reported their delivery figures for December 2025 and Q4 2025, showcasing significant growth in vehicle deliveries [2][3][4][5]. Group 1: NIO Performance - NIO achieved a record 48,135 vehicle deliveries in December 2025, reflecting a 54.6% year-over-year increase [3]. - The fourth-quarter deliveries reached a new high of 124,807 vehicles, up 71.7% from the previous year [3]. - For the full year 2025, NIO delivered 326,028 vehicles, marking a 46.9% increase year-over-year, with cumulative deliveries totaling 997,592 units as of December 31, 2025 [3]. Group 2: XPeng Performance - XPeng delivered 37,508 vehicles in December 2025, representing a modest 2% year-over-year increase [4]. - Total deliveries for 2025 surged to 429,445 units, more than doubling from the previous year with a 126% increase [4]. - Overseas deliveries for XPeng totaled 45,008 vehicles in 2025, up 96% year-over-year, as the company expanded operations to 60 countries and regions by year-end [4]. Group 3: Li Auto Performance - Li Auto delivered 44,246 vehicles in December 2025, a decrease from 58,513 units in December 2024 [5]. - Fourth-quarter deliveries amounted to 109,194 vehicles, bringing cumulative deliveries to 1,540,215 units as of December 31, 2025 [5]. - Li Auto expanded its international presence by launching new models in Egypt, Kazakhstan, and Azerbaijan, and operated 548 retail stores in 159 cities by year-end [6]. Group 4: Stock Performance - Over the past year, shares of NIO and XPeng have increased by 10.2% and 73.2%, respectively, while shares of Li Auto have decreased by 31.6% [7]. Group 5: Zacks Rank - NIO, XPeng, and Li Auto currently hold a Zacks Rank of 3 (Hold) [8].

Core Insights - NIO, XPeng, and Li Auto, three major Chinese smart electric vehicle manufacturers, reported their delivery figures for December 2025 and the fourth quarter of 2025, showcasing varying performance levels among them [1]. NIO Performance - NIO achieved a record 48,135 vehicle deliveries in December 2025, reflecting a 54.6% year-over-year increase. The breakdown included 31,897 units from the premium NIO brand, 9,154 units from the ONVO brand, and 7,084 units from the FIREFLY brand [2]. - For the fourth quarter, NIO's deliveries reached a new high of 124,807 vehicles, marking a 71.7% increase from the previous year. The total deliveries for the full year 2025 were 326,028 vehicles, up 46.9% year-over-year, with cumulative deliveries reaching 997,592 units by December 31, 2025 [2]. XPeng Performance - XPeng delivered 37,508 vehicles in December 2025, which is a modest 2% year-over-year increase. The total deliveries for 2025 surged to 429,445 units, more than doubling from the previous year with a 126% increase [3]. - The company also reported overseas deliveries totaling 45,008 vehicles for the year, reflecting a 96% year-over-year increase as it expanded operations to 60 countries and regions by the end of 2025 [3]. Li Auto Performance - Li Auto delivered 44,246 vehicles in December 2025, a decrease from 58,513 units in the same month of 2024. The fourth-quarter deliveries amounted to 109,194 vehicles, with cumulative deliveries reaching 1,540,215 units as of December 31, 2025 [4]. - Throughout the year, Li Auto expanded its international presence by launching new models in Egypt, Kazakhstan, and Azerbaijan, and operated 548 retail stores in 159 cities, along with 561 service centers across 224 cities. The company also established 3,907 supercharging stations in China, comprising 21,651 charging stalls [5]. Stock Performance - Over the past year, shares of NIO and XPeng have increased by 10.2% and 73.2%, respectively, while shares of Li Auto have declined by 31.6% [6]. Zacks Rank - Currently, NIO, XPeng, and Li Auto all carry a Zacks Rank of 3 (Hold) [8].

Core Insights - Li Auto Inc. delivered 44,246 vehicles in December 2025, bringing total fourth-quarter deliveries to 109,194 and cumulative deliveries to 1,540,215 as of December 31, 2025 [1][2] Group 1: Deliveries and Market Expansion - In December 2025, Li Auto surpassed 1.5 million cumulative vehicle deliveries [2] - The company expanded its global presence by introducing models Li L9, Li L7, and Li L6 to Egypt, Kazakhstan, and Azerbaijan, marking its entry into Central Asia, the Caucasus, and Africa [2] Group 2: Retail and Service Infrastructure - As of December 31, 2025, Li Auto operated 548 retail stores across 159 cities and 561 servicing centers, along with authorized body and paint shops in 224 cities [3] - The company had 3,907 supercharging stations in operation, equipped with 21,651 charging stalls in China [3] Group 3: Company Overview - Li Auto is a leader in China's new energy vehicle market, focusing on designing, developing, manufacturing, and selling premium smart electric vehicles [4] - The company aims to create a mobile home and happiness through innovative products, technology, and business models, and is a pioneer in commercializing extended-range electric vehicles in China [4] - Li Auto's current model lineup includes a high-tech flagship family MPV, four Li L series extended-range electric SUVs, and two Li i series battery electric SUVs, with plans for further product expansion [4]

Company Strategy Choices - The company will return to an entrepreneurial organizational model led by the founding team starting from Q4 2025, abandoning the professional management model attempted over the past three years. This decision is based on the rapidly changing industry technology and competitive environment, as well as the founder's extensive experience in startups [18][19]. - The product direction will focus on embodied AI robots rather than just electric vehicles or smart devices. This choice is made to avoid competition based solely on parameters like range and price, and to address user needs in high-frequency life scenarios [18][19]. Technical Route Selection - The company will build a full-stack AI system oriented towards the physical world instead of a language model route. Key breakthroughs will focus on enhancing perception capabilities with 3D Vision Transformers, which could increase effective perception range by 2-3 times [19][20]. - The model layer will aim to optimize the operating frequency of models, with a target to increase the current 10Hz frequency of a 4 billion parameter MOE model by 2-3 times, requiring customized GPU architecture and operating systems [20]. - The hardware layer will develop the Drive Biowire system to reduce the response time from 550 milliseconds to 350 milliseconds, potentially lowering accident rates by over 50% [21]. Q3 2025 Financial and Operational Data - Total revenue for Q3 was 27.4 billion RMB, a year-on-year decrease of 36.2% and a quarter-on-quarter decrease of 9.5%. Vehicle sales revenue was 25.9 billion RMB, down 37.4% year-on-year and 10.4% quarter-on-quarter [22]. - The overall gross margin was 16.3%, down 5.2 percentage points year-on-year and 3.8 percentage points quarter-on-quarter. Excluding recall costs, the gross margin was 20.4% [23]. - The net loss for the quarter was 624.4 million RMB, compared to a net profit of 2.8 billion RMB in the same quarter last year [26]. Product and Technology Progress - The I series models (I8/I6) are positioned to cover mainstream and high-end family markets, with significant order growth since September. Production capacity is expected to increase to about 20,000 units per month by early 2026 [30]. - The VLA system has been fully deployed, enhancing path selection at complex intersections, with further upgrades planned to improve safety and perception capabilities [44]. Market Strategy and Response - The company anticipates a significant drop in deliveries in Q1 2026 due to consumers rushing to take advantage of policy incentives before they expire. Long-term strategies include ensuring all models meet new energy consumption standards to qualify for subsidies [33][40]. - The company plans to operate approximately 4,800 supercharging stations by 2026, with 35% located in highway service areas, to enhance user experience and support the transition to new energy vehicles [40].

Core Viewpoint - Li Auto Inc. reported a significant decline in vehicle deliveries and financial performance for the third quarter of 2025, reflecting challenges in the new energy vehicle market and operational difficulties. Operating Highlights - Total deliveries for Q3 2025 were 93,211 vehicles, a 39.0% year-over-year decrease [2][3] - The company had 542 retail stores in 157 cities and 3,420 supercharging stations in operation as of September 30, 2025 [3] Financial Highlights - Vehicle sales amounted to RMB 25.9 billion (US$ 3.6 billion) in Q3 2025, down 37.4% from RMB 41.3 billion in Q3 2024 and down 10.4% from RMB 28.9 billion in Q2 2025 [4][13] - Total revenues were RMB 27.4 billion (US$ 3.8 billion), a decrease of 36.2% year-over-year [4][13] - Gross profit was RMB 4.5 billion (US$ 627.8 million), down 51.6% from RMB 9.2 billion in Q3 2024 [4][13] - Net loss was RMB 624.4 million (US$ 87.7 million), compared to a net income of RMB 2.8 billion in Q3 2024 [4][24] Cost and Margin Analysis - Cost of sales was RMB 22.9 billion (US$ 3.2 billion), a decrease of 32.0% from RMB 33.6 billion in Q3 2024 [18] - Vehicle margin was 15.5% in Q3 2025, down from 20.9% in Q3 2024 [4][18] - Gross margin was 16.3%, compared to 21.5% in Q3 2024 [4][18] Operating Expenses - Operating expenses were RMB 5.6 billion (US$ 793.1 million), a decrease of 2.5% from RMB 5.8 billion in Q3 2024 [4][18] - Research and development expenses increased by 15.0% year-over-year to RMB 3.0 billion (US$ 417.8 million) [18] Cash Flow and Financial Position - Net cash used in operating activities was RMB 7.4 billion (US$ 1.0 billion) in Q3 2025, compared to RMB 11.0 billion net cash provided in Q3 2024 [7][24] - Free cash flow was negative RMB 8.9 billion (US$ 1.3 billion) in Q3 2025 [7][24] - Cash position was RMB 98.9 billion (US$ 13.9 billion) as of September 30, 2025 [24] Recent Developments - The company launched the Li i6, a new battery electric SUV, in September 2025 [9] - In October 2025, Li Auto opened its first overseas authorized retail store in Tashkent, Uzbekistan [10] - The Li i8 achieved the highest score in the China-Automobile Health Index assessment [11] Management Commentary - The CEO highlighted strong momentum in the BEV portfolio and confidence in achieving long-term strategic objectives despite market challenges [12] - The CFO noted operational resilience with a gross margin of 20.4% when excluding recall costs [12]

Core Insights - Li Auto Inc. delivered 31,767 vehicles in October 2025, bringing cumulative deliveries to 1,462,788 as of October 31, 2025 [1] - The Li i6 model has received over 70,000 orders since its launch, prompting the company to enhance delivery capabilities [2] - Li Auto is expanding globally, having opened its first overseas retail store in Uzbekistan and planning additional stores in Kazakhstan [2] Company Operations - As of October 31, 2025, Li Auto operates 551 retail stores across 157 cities, 554 servicing centers, and authorized body and paint shops in 225 cities [3] - The company has established 3,508 supercharging stations with 19,417 charging stalls in China [3] Product and Technology - Li Auto is a leader in China's new energy vehicle market, focusing on premium smart electric vehicles and extended-range electric vehicles [4] - The company aims to create a mobile home experience through innovative products and technology, with a current lineup that includes multiple models of extended-range electric SUVs and battery electric SUVs [4]

Core Viewpoint - Li Auto is experiencing demand contraction and sales underperformance, leading to revised sales volume and earnings forecasts for 2025-26 due to increased competition and margin compression from new BEV models [1][2][4]. Sales Performance - In 1H25, Li Auto's sales lagged behind the broader market, with a market share decline of 2 percentage points in China's NEV market [2]. - Weekly sales have dropped from 8-9k units to below 6k units, indicating deteriorating demand dynamics [2][3]. - The company anticipates a potential year-over-year sales decline exceeding 30% in 3Q25 due to inadequate delivery of new models [4]. Margin and Earnings Outlook - Despite a vehicle margin of around 19% in 2Q25, margin compression is expected from the increased sales mix of i-series BEVs, which have higher BOM costs [1][3]. - Non-GAAP net income forecasts have been reduced by 37%-47% to RMB6.2 billion and RMB10.1 billion for 2025 and 2026, respectively [4]. Competitive Landscape - Li Auto faces intensified competition as rivals introduce lower-priced models with similar features, challenging its market position [5]. - The company has been criticized for its slow response to competitors and for not sufficiently innovating its product offerings [5][6]. Strategic Focus - The company needs to pivot its strategic focus to expand its BEV reach while maintaining relevance in the EREV market through effective product iteration [6]. - A shift back to P/S multiples for valuation is preferred due to near-term profitability volatility and the industry trend among NEV counterparts [7].

Core Viewpoint - Li Auto Inc. has revised its delivery outlook for Q2 2025, expecting to deliver approximately 108,000 vehicles, down from a previous estimate of 123,000 to 128,000 vehicles, due to a temporary impact from a sales system upgrade [1] Company Overview - Li Auto Inc. is a leader in China's new energy vehicle market, focusing on designing, developing, manufacturing, and selling premium smart electric vehicles [2] - The company's mission is to create a mobile home and happiness, providing families with safe, convenient, and comfortable products and services [2] - Li Auto is a pioneer in commercializing extended-range electric vehicles in China while also developing battery electric vehicle platforms [2] - The company began volume production in November 2019 and has a diverse model lineup, including Li MEGA, Li L9, Li L8, Li L7, and Li L6 [2]