Lixiang, a Chinese electric vehicle maker little known outside the country, is quickly catching up to other domestic EV startups by delivering more than 2,600 cars in April, a finish just several hundred units fewer than another Tesla’s challenger, Nio.
Why it matters: The April sales figures from Nio and Lixiang could be an indicator for a V-shaped recovery in the world’s biggest EV market. Automakers in China have been hurt by a months-long pandemic, subsidy cuts, and a broader slump.
- Nio on Wednesday reported an 106% month-on-month increase in April deliveries with a combined number of 3,155 ES8 and ES6 vehicles handed over. Lixiang achieved 80% growth from the previous month when 1,447 Lixiang EVs were delivered.
- The decline of China auto retail sales narrowed to -2% year-on-year over the first four weeks in April, according to figures from China Passenger Car Association (in Chinese).
- The Chinese industry group expects general auto sales in April to fall by 6% from the same period of last year, a recovery from a 40% year-on-year drop in March.
Details: Lixiang’s total sales reached more than 6,500 vehicles as of April after it began delivering its plug-in hybrid (PHEV) crossover Ideal One in December, with more than 40% achieved over the past month, the company said last week.
- Lixiang’s first mass production car, the Ideal One, was one of the only two models by EV startups on the top 20 ranking of China EV sales in March.
- The company sold 1,447 units, just a few dozen fewer than Nio’s ES6.
- Formerly known as CHJ Automotive, the Beijing-based EV startup began taking orders for the seven-seater PHEV in April 2019.
- From July 23, the Ideal One will be ineligible for the country’s EV subsidies when Beijng’s 10% cut in subsidies takes effect. The new rules exclude EVs that cost RMB 300,000 or more, but gives exemptions to those powered by swappable batteries.
- Li Xiang, founder and CEO, later promised to cover the cost for customers, which is RMB 10,000 per unit.
- Only a few months after closing a $530 million Series C led by Meituan’s founder Wang Xing, Lixiang was rumored to have filed for an $500 million IPO that could happen as early as the first half of 2020, as reported by Reuters.
- Speaking with media in Beijing on April 30, Li declined to confirm rumors that the company has scaled back IPO plans following Luckin’s fraud scandal, adding that it has been free cash flow positive and therefore “does not rely on external funding to sustain business operations.” (our translation).
Context: Tesla now has a commanding lead in the Chinese EV market with 11,280 vehicles delivered in March, a number that is 10 times bigger than that of Nio and Lixiang.
- The US EV giant last week announced a 10% cut in the price for China-made Model 3 sedans to meet the latest government requirements for automakers to earn the subsidies.
- Previously, Li said on Chinese microblogging platform Weibo that the new RMB 300,000 price cap will allow Tesla to “beat Chinese EV makers hard,” especially those within a same price range.
- Chinese EV models priced at RMB 200,000 and above include BYD’s luxury electric SUV Tang, GAC Nio’s Hycan 007, and Xpeng’s first sedan model P7.