Li Auto's Q1 2025: Navigating Contradictions in AI Strategy, Market Expansion, and Margin Outlook

AI strategy and product timeline, expansion and sales strategy, autonomous driving progress and strategy, vehicle and gross margin expectations, and expansion into overseas markets are the key contradictions discussed in Li Auto's latest 2025Q1 earnings call.



Vehicle Sales and Market Share Growth:
- Li Auto reported delivering more than 92,000 vehicles in Q1 2025, an increase of 15.5% year-over-year, with total revenues of RMB25.9 billion.
- The growth was driven by strong performance in the RMB200,000 and above NEV market and an increase in market share to 14.1% in April.

Product Innovation and Model Launches:
- The company launched new models, including the Li MEGA Home and Li L Series, which enhanced user value with ongoing innovation and product iteration.
- The success of the Li MEGA Home, accounting for over 90% of Li MEGA orders, was attributed to its alignment with family mobility needs.

Financial Performance and Cost Management:
- Li Auto reported a vehicle margin of 19.8% in Q1 2025, up from 19.3% in the same period last year.
- The increase was mainly due to cost reductions and strategic pricing changes in the first quarter of 2024.

Charging Network Expansion:
- Li Auto has built the largest urban highway supercharging network, covering over 50,000 kilometers of highways.
- The company plans to deploy over 2,500 new stations in June and aims for 4,000 stations by year-end, enhancing charging network competitiveness.

ADAS Technology and VLA Driver Model:
- Li Auto is rapidly developing its ADAS technology, with plans to launch the VLA Driver model with the Li i8 in July.
- The VLA Driver model integrates spatial, language, and behavioral intelligence, enabling ADAS to perceive, think, and adapt to the environment, aiming to redefine user experience.