- A class-action lawsuit alleges Li Auto inflated demand for its vehicles, particularly the new Li Mega electric minivan
- The Chinese carmaker initially expected to sell between 100,000 and 103,000 vehicles in Q1, but revised this estimate to between 76,000 and 78,000.
- The Mega marks the brand’s debut in the battery-electric vehicle market and recently underwent a price reduction of 30,000 yuan.
Chinese carmaker Li Auto has been hit with a class-action lawsuit in the United States, which claims it has overstated the demand for its vehicles, including the newly announced Li Mega luxury minivan.
The lawsuit alleges that Li Auto has engaged in securities fraud, contending that the car manufacturer had highly optimistic projections for the Mega, suggesting it could sell as many as 8,000 units each month. Li Auto also anticipated selling between 100,000 and 103,000 vehicles during the first quarter of 2024, but recently revised these estimates to between 76,000 and 78,000.
On Monday, the company released its actual first-quarter sales, reporting 80,400 deliveries, including the first shipments of the seven-seater Mega. Revenue for the quarter reached 24.25 billion yuan (about $3.4 billion at current exchange rates), reflecting a 32% year-on-year increase. However, this fell short of analyst expectations of 26.71 billion yuan ($3.7 billion).
Read: Li Auto Mega EV Is A 5.5-Second Sleeper That Recoups 311 Miles In 12 Minutes
According to CNEVPost, on March 21, Li Auto founder Li Xiang sent an internal letter disclosing that the operational strategy for the Mega was “mis-paced.” The lawsuit further supports that Li Auto structured its operations around the Mega as if it had already entered the ‘scaling phase’ of sales, prioritizing customer acquisition, team building, and operational efficiency, despite being in the early ‘validation’ period.
News of the class action lawsuit triggered a 17.2% decline in the company’s U.S. shares, which fell to $21.71 on the Nasdaq at the time of publishing.
The Mega is an important vehicle for Li Auto as it marks the company’s foray into battery-electric vehicles, contrasting with most of the brand’s other models, which are range-extenders. This massive minivan measures over 5.3 meters (210 inches) in length and was initially priced from 559,800 yuan ($77,500). However, the starting price was later reduced to 529,800 yuan (~$73,300) on April 22.
Beneath the skin of the Mega lies a 102 kWh Qilin battery sourced from CATL. This battery provides the EV with an impressive range of 441 miles (710 km). With just 12 minutes of charging, it can recover 311 miles (500 km) of energy. Propelled by a pair of electric motors generating 400 kW (536 hp), the Mega can accelerate from 0 to 100 km/h (62 mph) in just 5.5 seconds.