Stock Track | Leapmotor Plummets 5% Intraday as Aggressive D19 Pricing Strategy Sparks Profitability Concerns

Stock Track04-20

Leapmotor's stock price plummeted 5% during intraday trading, reflecting investor concerns about the company's near-term profitability outlook following the launch of its flagship model.

The electric vehicle maker recently introduced its D19 full-size SUV with an aggressive "cost-based pricing" strategy, positioning the model between 218,800 and 269,800 RMB to penetrate the sub-300,000 RMB market segment. This pricing approach has raised market concerns about potential gross margin compression for the company.

Adding to investor unease, founder Zhu Jiangming emphasized that the company's priority over the next three years will be scaling up volume rather than pursuing profitability, further weighing on near-term earnings expectations. His comments about the ongoing industry consolidation, noting that not all 17 Chinese automakers will survive, have also contributed to the negative market sentiment.

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