To The Moon

According to the data of China Passenger Car Association, the penetration rate of new energy passenger cars reached 31.7% in the fourth quarter of 2022, compared with 14.8% and 29.0% in the third quarter of 2021 and 2022 respectively.

​$Li Auto(LI)$InIn less than a year, three new models, L9, L8 and L7, were launchedInheriting Lao Huang's "precise knife method", it basically achieved full coverage of the household SUV market of 300,000-500,000 yuan.$LI AUTO-W(02015)$​

Delivery aspectIn December 2022, Ideal delivered more than 20,000 vehicles, L9 has been at the top of the monthly sales list of full-size SUVs, and Ideal L8 has continued to achieve good sales results, becoming the sales champion of large SUVs in December 2022. Ideally, 46,319 new cars were delivered in Q4 in 2022, and the annual delivery volume in 2022 reached 133,246. "Wei Xiaoli" turned into "Li Wei Xiao", and compared with the delivery volume and the average delivery price, Tucki began to lose out with the ideal and Wei Lai.

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RevenueThe ideal revenue reached RMB 17.65 billion in the fourth quarter, and the annual revenue in 2022 reached RMB 45.29 billion, up 66.2% and 67.7% respectively.It is worth noting thatIdeal maintained a healthy gross profit margin of 20.2% and a free cash flow of RMB 3.26 billion in the fourth quarter of 2022. By the end of the fourth quarter, the cash reserve of Ideal Automobile reached RMB 58.45 billion. "Completion of profit KPI" is particularly important for ideal car companies that have lost seven years.

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In terms of product lineup,On February 8th, SUV L7 was officially launched, and the test drive started the next day. The CLPC of L7 has a cruising range of 1,315 km and an acceleration time of 5.3 seconds from 0 to 100 km/h. L7 offers three interior levels: Air, Pro and Max, covering the price range of 300,000 yuan to 400,000 yuan. In addition to the release of L7, Air models have also been released in L8 series, covering the price range of 300,000 yuan to 350,000 yuan. Ideal will start delivering Li L7 Pro and Max in early March this year, and Li L7 Air and L8 Air will start delivering in early April this year. With the launch of these new models, the layout of L7, L8 and L9 in the whole SUV market of 300,000-500,000 yuan has been ideally completed. Relying on the continuous strong performance of L8 and L9 and L7 joining the ideal camp, the ideal will set a 20% market share for the high-end SUV segment of RMB300, 000 to RMB500, 000 this year. Against this background,It is expected that the delivery volume in the first quarter will be between 52,000 and 55,000 units.

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In terms of supply chain,Despite continuing challenges to the supply chain, L9 and L8 delivered more than 10,000 units in the first full month of delivery. To a certain extent, it proves the ideal and solid supply chain management ability.

In marketing,After more than three years of operation, the direct sales model has proved to be able to provide a better user experience at a lower cost, which will be their long-term commitment as a high-end automobile brand. By 2022, the ideal SG& A the expenses have already been its R&D expenses, and it is estimated that the percentage of its sales expenses to revenue will be further reduced in 2023.On the cost of models, the absolute value of R&D expenses of ideal single models is the highest, the proportion of marketing is the lowest, and the R&D gold content is the highest

Research and developmentIdeal adopts the fusion BEV algorithm framework jointly proposed by Tsinghua University, Massachusetts Institute of Technology and Ideal R&D, which can flexibly deploy different hardware configurations of Li AD Max and AD Pro. Its internal highway NOA prediction algorithm can realize organic automatic lane change and smooth acceleration and deceleration experience. Up to now, more than 220,000 home users have used the ideal NOA function of expressway, covering 100 million kilometers.

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What is worth paying attention to in the Q&A:

The ideal product line is so dense, will there be such a situation as "the second brother robbed the eldest brother's business" (the potential encroachment brought by the overlapping pricing points of different models and versions)?

Li Xiang said that in practice, the user group differences of L789 are not as overlapping as expected. L7 is easy to attract families of three, while L89 is more attractive to families with two children. What the ideal really forms is not only a product line, but actually a product network.

"We hope that any family willing to buy an SUV will come to our network and find and think about whether they should buy L7 or L8 or L8 or L9, instead of comparing us with other brands and choosing which brand to buy. This has always been our core product concept about L7, L8 and L9 product lineup."

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Ideal has achieved great success in extending range. For pure electric products, how to maintain high gross profit margin and high product competitiveness? In addition, some peers are also investing in medium and large SUVs with 800 volts ultra-high voltage and fast charging, but the effect is not good. How will the ideal be broken?

Li Xiang said that looking at extended range products solves the two core pain points of difficult charging, slow charging speed and high battery cost. Therefore, it is ideal to adopt the extended range strategy of large battery to realize "urban electricity consumption and long-distance power generation".

When it comes to pure electric products to be launched, the problems to be solved are essentially the same.

First, it is very critical to provide charging for 400 kilometers in 10 minutes and realize charging experience close to fuel vehicles. The key point behind this is similar to that of mobile phones, that is, 4G mobile phones need 4G base stations to exert their real capabilities. Similarly, ultra-high voltage fast charging is to solve the problem of "difficult and slow charging".

Second, the 800-volt and self-built silicon carbide module factories are designed to improve the efficiency of the whole power drive level, and at the same time cooperate with the improvement of vehicle research and development. At present, the measured result is that compared with the same 400-volt mainstream IDBC with the same driving mode, the 800-volt driving can save about 15% of the battery power. This is a very significant advantage in terms of cost, that is, it solves the problem of "high cost and overweight battery".