Stock Track | LI Auto Plunges as Trump Election Fears Spook Chinese EV Makers

Stock Track11-12

Shares of Chinese electric vehicle maker LI Auto Inc. plummeted by 5.75% on Monday, outpacing the broader market declines, as concerns mounted over the potential impact of a Donald Trump presidency on the company's US expansion plans.

The sell-off in LI Auto's stock came amid reports that the return of Trump to the White House in January 2025 could dampen the outlook for Chinese EV manufacturers looking to penetrate the US market. According to analysts, Trump's previous promises to increase tariffs on countries deemed as hurting US industries, including the auto sector, have raised fears of potential trade barriers and higher costs for Chinese EV makers like LI Auto.

While the Biden administration has been more welcoming of Chinese EV companies entering the US market, bipartisan concerns over China's economic and technological rivalry with the US could also pose challenges for LI Auto and its peers. Analysts suggested that the companies may need to consider strategies such as relocating operations to the US, lobbying for tariff exemptions, or diverting to other markets to mitigate the potential impact of a Trump presidency.

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