Li Auto, is it too early to rejoice?

Mondo Cars Updated on 2024-03-04

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Reporter丨Wang Jieren Trainee丨Tu Ling

Produced by丨Aotou Finance (thesankei).

Recently, Li Xiang collaborated with Li Auto (2015HK) can be described as a beautiful scenery.

On the evening of February 26, Li Auto disclosed its financial report and achieved an operating income of 1238 in 20235.1 billion yuan, becoming China's first new power car company with an annual revenue of more than 100 billion yuan, with a net profit of 1180.9 billion yuan, the first full-year profit since delivery.

Xiaopeng Motors, Nezha Automobile, Weilai Automobile and other car companies are still struggling with huge losses, and Li Xiang and Li Auto are already "smiling proudly". Li Xiang aims to double car deliveries to 800,000 units by 2024.

But it may be too early to be complacent, and there are still many challenges for Li Auto.

has just entered 2024, and the "first brother" BYD has set off a first-class war and set off an "involution" trend. In January, the sales volume of Cialis (Wenjie) surpassed that of Li Auto. BYD, Geely, as well as Aion and SAIC's Zhiji, which will be delivered in the second quarter, Xiaomi Automobile, and the "awakening" of traditional car companies, all of which are destined to be not easy for Li Xiang.

The best performance with the soaring share price

As Li Xiang said, in the past year, Li Auto has achieved excellent results.

According to the financial report, in 2023, Li Auto's operating income will reach 12385.1 billion yuan, a year-on-year increase of 17348%。Among them, the operating income in the fourth quarter was 4173.2 billion yuan, a year-on-year increase of 13644%, an increase of 2034%。The operating income of the company's automobile business was 1202900 million yuan, a year-on-year increase of 1727%, accounting for 97% of total revenue. Other business income 35600 million yuan, a year-on-year increase of 2013%。The revenue from other businesses was mainly driven by the increase in the sales of charging piles due to the increase in the delivery of models, and the sales of accessories and services also increased.

Behind the revenue of more than 100 billion yuan is the sharp increase in the delivery volume of Li Auto. According to the data, in 2023, Li Auto will deliver 3760,000 units, a year-on-year increase of 1822%, becoming the sales champion of new energy vehicles of more than 300,000 yuan in the Chinese market.

In addition to the operating income exceeding the 100 billion mark for the first time, the net profit of Li Auto is also very bright, reaching 1180.9 billion yuan. In contrast, a number of new car-making forces such as Xpeng Motors and Weilai are still suffering from huge losses. Li Tie, Chief Financial Officer of Li Auto, is quite proud, and 2023 is the first year for Li Auto to turn a profit and achieve a healthy profit.

In 2019, Li Auto launched its first model, Ideal One, and in the fourth quarter of 2020, Li Auto achieved 10.8 billion yuan of single-quarter profit. Then, three consecutive quarters of losses, with a profit of 29.6 billion yuan, followed by three consecutive quarters of losses, and in the fourth quarter of 2022, it once again achieved a single-quarter profit.

By 2023, Li Auto will successively launch three models, L7, L8, and L9, ushering in its first comprehensive profit year. Li Auto made a full profit for the first time, breaking the dilemma of long-term losses of new power car companies, and thus became the third new energy vehicle company in the world to achieve profitability after Tesla and BYD.

According to the performance forecast, in 2023, BYD's net profit will be between 29 billion yuan and 31 billion yuan, and the annual car delivery volume will be 30240,000 units, which is 804 times, and its net profit is expected to be less than 3 times that of Li Auto. The reason is that Li Auto's gross profit margin is rising. In 2023, Li Auto's comprehensive gross profit margin will be 2220%, up 2 percent year-on-year79 percentage points. Among them, the gross profit margin of vehicles was 215%, an increase of 2 year-on-year4 percentage points. In the first three quarters of 2023, BYD's comprehensive gross profit margin will be 1979%, which is 1 lower than Li Auto78 percentage points.

The increase in gross profit margin was mainly due to lower costs. For the fourth quarter of 2023, Li Auto's selling, general and administrative expenses were 32700 million yuan, with an expense ratio of 784%, compared to 924% further decreased.

Stimulated by the soaring performance, Li Auto's stock price rose sharply. On February 26, Li Auto's U.S. stock rose 1879%。On February 27, Hong Kong stocks rose 2545%。

800,000 vehicles are targeted with the belly and back of the enemy

The performance has risen sharply, Li Xiang is full of confidence, and intends to take advantage of the victory to chase after it, and set a delivery target of 800,000 units in 2024.

Deliveries in 2023 are 3760,000 units, 800,000 units in 2024, an increase of 4240,000 units, which means that deliveries will more than double this year.

By the end of 2023, Li Auto had 467 retail centers covering 140 cities and operated 360 aftermarket repair centers in 209 cities. In 2024, the target number of retail centers will increase to 800.

Li Xiang said that 2024 will be an unprecedented product year for Li Auto. Currently, AD Max 3The 0 intelligent driving system has opened the "high-speed + urban" full-scene intelligent driving NOA for all AD Max users, covering national highways, urban ring roads and more than 110 urban roads. On March 1 this year, the long-awaited ideal MEGA will be launched.

Li Auto's plan is that the MEGA will enter the MPV segment as Ideal's first pure electric model, the L series will be renewed, and the 2024 L series "789" model will be released and delivered in March this year. In addition, the L6 is also expected to be launched this year, and Li Xiang's confidence lies in cash flow, as of the end of 2023, Li Auto's cash reserves will reach 1036700 million yuan. Sufficient funds ensure that Li Auto increases R&D investment. In 2023, the company's R&D investment will reach 105900 million yuan, a year-on-year increase of 561%。

Achieving the goal of 800,000 units will not be easy.

From the perspective of the entire new energy vehicle environment, the ideal car is attacked by the enemy.

Among the new forces in car manufacturing, Aion, which is backed by GAC Group, has both advantages in technology, factories and first-class chains. Zhiji Automobile, Deep Blue Automobile, Dongfeng Lantu, etc., all have the background of traditional car companies and have obvious advantages. The product cooperated with Huawei, which was equipped with Huawei's black technology, and attracted a large amount of traffic. The new M7 M9 highlights the large space and high-end interior, which has aroused great attention from consumers. Xiaomi Automobile, which was announced to be delivered as early as the second quarter of this year, focuses on the concept of "people, cars, and home ecology", and the unique marketing model of suspense has made consumers ready to move.

In addition, Xiaopeng Motors, as well as Weilai Automobile, Nezha Automobile, Leapmotor, etc., are all doing everything possible to compete for market share.

In addition to Tesla, Li Auto's two major rivals, BYD and Geely, cannot be ignored. In 2023, BYD's global sales volume will be 30240,000 units, and then win the sales crown, the advantage of its own battery, so that peers are out of reach. Geely is not to be outdone, and has a variety of new energy vehicle brands such as Leading, Zeekr, Polestar, Geometry, and Lotus. In the first quarter of this year, Geely's new energy vehicle sales were 6580,000 units, a year-on-year increase of 591%.

Li Auto's advantages lie in its differentiated positioning, large-size SUV, large space, comfortable seats, and audio-visual entertainment functions designed for family users. This market "gap" has also been discovered by peers, including Wenjie, Geely, Volkswagen, etc., have targeted this field.

The industry believes that in 2024, the industry's "** war" and "involution" will continue. Since the beginning of this year, BYD has set off a "first-class war", and a number of new energy vehicles have followed up, and it may be difficult for Li Auto to stand alone.

In January this year, Li Auto sold 31,162 vehicles, down 38 percent from the previous month11%, a year-on-year increase of 1058%。The sales volume of Wenjie was 32,973 units, an increase of 34 from the previous month76%, a year-on-year increase of 63683%。Wenjie sold 1,811 more units than Li Auto.

The new energy vehicle market is "involuted", facing the encirclement of new forces such as Wenjie and Xiaomi Automobile, as well as traditional car companies.

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