Q1 2025 Li Auto Inc Earnings Call
Unknown Executive: Hello, ladies and gentlemen. Thank you for standing by for Li Auto's first quarter 2025 earnings conference call. At this time, all participants are in listen-only mode. Today's conference call is being recorded.
Hello, Ladies and gentlemen, thank you for standing by ALLETE first quarter 2025 earnings conference call.
At this time, all participants are in listen only mode.
Today's conference call is being recorded.
Janet Zeng: I will now turn the call over to your host, Ms. Janet Zeng, Investor Relations Director of Li Auto. Please go ahead, Janet. Thank you, Kelly. Good evening and good morning, everyone. Welcome to Li Auto's first quarter 2025 earnings conference call. The company's financial and operating results were published in a press release earlier today and are posted on the company's IR website.
Speaker Change: I will now turn the call over to your host Ms. Janet <unk>.
Speaker Change: Mr Relations Jack carefully audit. Please go ahead Janet.
Janet: Thank you Kelly good evening and good morning, everyone. Welcome to <unk> first quarter, two shotguns 25 earnings conference call the company's financial and operating results were published in our press release earlier today and are posted on the Companys IR website on today's call we will have our chairman.
Janet Zeng: On today's call, we will have our chairman and CEO, Mr. Xiang Li, and our CFO, Mr. Johnny Tie Li, to begin with prepared remarks. Our president, Mr. Donghui Ma, and our senior vice president, Mr. James Liangjun Zou, and our CTO, Mr. Yan Xie, will join for the Q&A discussion.
Janet: Oh, Mr Shao, Lee and our CFO, Mr. Johnny to Lee to begin with prepared remarks are our president Mr Don't Lima, and our senior Vice President Mr. Jim Don and number of CTO. Mr. Young Kids, who are joined for the Q&A discussion before we continue please be reminded that today's research. Please go.
Janet Zeng: Before I continue, please be reminded that today's discussion will contain forward-looking statements made under the safe harbor provisions of the U.S. Private Securities Dedication Reform Act of 1995. Forward-looking statements may involve inherent risks and uncertainties. As such, the company's actual results may be materially different from the views expressed today. Further information regarding risks and uncertainties is included in certain company's filings with the U.S. Securities and Exchange Commission and the Stock Exchange of Hong Kong Limited. The company does not assume any obligation to update any forward-looking statements except as required under applicable law.
Janet: And will contain forward looking statements made under the safe Harbor provisions of the U S. Private Securities Litigation Reform Act of 1995 forward looking statements may involve encourage risks and uncertainties as such the company's actual results may be materially different from the views expressed today.
Janet: For information regarding risks and uncertainties is included in certain companies valleys waste at U S Securities and Exchange Commission Commission and to the stock exchange of Hong Kong Limited.
Janet: The company does not assume any obligation to update any forward looking statements except as required.
Janet: Click about law.
Janet Zeng: Please also note that Li Auto's earnings price release and this conference call include discussions of unaudited GAAP financial information as well as unaudited non-GAAP financial measures. Please refer to Li Auto's disclosure document on the IR section of our website, which contains a reconciliation of the unaudited non-GAAP measures to comparable GAAP measures.
Janet: Please also note that the Altos earnings press release and this conference call include discussions of unaudited GAAP financial information as well as audited non-GAAP financial measures. Please refer Giuliano speed Cook disclosure documents on the IR section of I heard about such with attention content off of it.
Janet: A reconciliation of the unaudited non-GAAP measures to comparable GAAP measures.
Janet Zeng: Our CEO will start his remarks in Chinese, there will be English translation after he finishes all his remarks.
Speaker Change: Our CEO will start his remarks in Chinese there'll be English translation. After he finishes all his remarks with that I will now turn the call over to our CEO. Mr. Shan Li. Please go ahead.
Janet Zeng: With that, I will now turn the call over to our CEO, Mr. Xiang Li. Please go ahead.
Yeah.
Speaker Change: Okay all.
Xiang Li: Hello everyone, I am Li Xiang. Welcome to today's phone call meeting. First, let's review the performance of the first quarter of Li Xiang Automobile. In the first quarter of 2025, the total number of new cars was 920,000. The growth rate was 15.5%.
Speaker Change: <unk> got the agenda.
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Janet: No drama here shortly.
Janet: Yeah, Yeah. So there.
Xiang Li: 交付量驱动收入达到了人民币259亿元 According to the data uploaded by Zhong Qiyan, the ideal car performance in China's mid-size car market of 200,000 or more is strong. The price of the car is twice as high as the price of the car. In addition, as of the end of April this year, Nissan has won the Chinese car brand sales champion for 14 months in a row. Especially in April, Nissan's market share fell to 14.1%, further occupying more than 200,000 of all Chinese cars. As of April, the cumulative delivery of Ideal Motors has exceeded 1.26 million cars. As the initiator and leader of the Zengcheng car model, the Li Auto series continues to innovate and improve the user experience.
Janet: I'm still here.
Janet: As you can see I'm, sorry could you characterize listen to ask you too you got you.
Janet: Hum.
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Janet: Yeah.
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Janet: Sure.
Janet: Because you should talk to each other.
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Janet: E G who can do that.
Jonathan: That's your math yourself Uzi 90 sure Jonathan.
Jonathan: Thank you.
Jonathan: And how about as far as new ideas.
Janet: Yes.
Janet: So there is going to occur.
Putting that type of thing.
Janet: Yeah.
So as we continue with that.
Sure.
Xiang Li: In the face of the challenges of the future, we will always maintain our competitive advantage.
Speaker Change: Oh, how does it have any as yet Joe boxer.
Yes.
Xiang Li: In the near future, we will release a smart innovation version of the Ideal Mega and Ideal R series. Equipped with AV Max advanced auxiliary drive system dual board generation With the advanced design of AD川内Ethereal Supply Drive System przłysył w obszarowy system Upgraded from interface crisis class G5 to class G6 M-chip And equipped with the new lateral내ذery of ECL with Psychodecarboxystem to provide users with a more intelligent and safe driving experience. Apart from the upgraded upgrades in corporate speeds, we also upgraded and upgraded the player's way of working, the outlook of the map, the integrated residential areas, trucks, piano zones, ammo information control system, as well as the role of road-ornament system.
Janet: I'll start with at least a Mega fleet as you do that.
Max: Thank you Max.
Max: Got it.
Max: Okay.
So our intention at all.
Max: Okay cool.
Max: Gotcha.
Thank you Tricia.
Max: Kochi cancer.
Max: Yeah I'll take that.
Yes.
Examples you laid out.
Max: Gotcha Gotcha.
Max: Yes.
Max: As long as you lap that.
Max: Proposal one issue.
Max: Oh gosh.
Max: You bet.
Max: Thank you Melissa.
Unknown Executive: Technical reporting, Tim Hsiao.
Max: The RFID or what was that acquisition that we did that.
Max: So he has to keep them happy.
Max: You sound like a whole secondarily about.
Max: My goal.
Max: She entered nothing.
Xiang Li: 来到后我们又有理想旗舰车型的顶级配置 This is also the closest company mission we have achieved so far, to create a product that moves home and stimulates home. 後半上市以後,在Mega車型中的整個佔比超過了9%。 This project has significantly improved user acknowledgement of the value of the product. At present, there are sufficient orders from Ideal Media, and new orders continue to flow in. In order to meet the growing demand for users, we will continue to increase production.
Max: Yes, it is beginning to use it.
Max: 50 equals this again.
Max: Yep.
Max: Thank you.
Max: Oh My God. This is Paul <unk>.
Max: So I didn't know.
Speaker Change: How what is your goal.
Speaker Change: Cool.
Speaker Change: Yeah.
Max: Great.
Max: Got it.
Max: Yeah.
Max: [noise] excuse me last year.
Max: Three months.
Max: Thank God.
Max: So on the downstream.
Max: Oh, yeah yeah.
Xiang Li: We expect to achieve the 2,500 to 3,000-deck traffic target in July. The Ideal Micro Home, Astro, and Ideal L series smartphones have already started delivery this month. With the full-fledged delivery of the updated model, we expect that the delivery volume of the Ideal 7 will reach 12.3 million to 12.8 million units. 理想賣 Baum的成功, 使我們對理想純粒SUV進入高端純電風市場。 creed its success behind Mt. baise and get ourlem to support high-end只電風st LAKE pure DC SUV market.
Max: Yeah drew thank.
Max: Second the dumping jumping to be honest.
Max: [noise] Aqua pledge to nowhere.
Speaker Change: Oh, yeah, yeah touches Yahoo.
Max: What goes into it than that.
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Max: He said the Joplin jumped from Chicago to.
Max: Two shot in Colorado.
Speaker Change: These are not wholly Trimble Shaw on.
Max: For me I believe it will go.
Max: Once again lets see how easy the BTG pactual comfortable living yeah.
Xiang Li: We have made great progress in the preparation for the launch of the Pure Electronics SUV. The i8 will be officially released in July this year, and the i6 will be released in September this year. The i8 is currently being registered nationwide. Before the launch, the final optimization of the i8 has exceeded 9.5 million kilometers. The high-efficiency charging network is a key factor in the user experience of charging vehicles. In line with the charging vehicle market plan, we have built the largest city and high-speed charging network in terms of vehicle size. As of the end of the first quarter, the high-speed highway covers more than 50,000 kilometers.
Max: Well listen, yes, the Leer South Dakota.
Max: Thanks.
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Max: Yeah.
Max: Is it Julien.
Max: Yeah.
Max: That's sort of chosen that shrunk a little cool.
Max: Similarly, you called out Chile, you closer detail you don't have to bet incrementally.
Max: Got it okay.
Max: Sure.
Max: Yes.
Max: Hey, Luke.
Max: Well, yes.
Max: Sure. So we wont be it on it.
Max: Oh yeah.
Max: Kosovo hold wildly.
Xiang Li: At present, Ideal Motor Vehicles has opened and operated 2,350 Ideal Charging Stations, equipped with more than 128,000 tons of charging equipment.
Max: I gotcha.
Max: East Coalinga.
Max: However, our total loan book.
Max: Oh cool.
Max: How about that.
Xiang Li: We have also built 20 popular tourist attractions and long-distance travel routes in China, We will continue to speed up the supercharger layout and ensure that 2,500 ideal superchargers will be built in June. We will keep a close eye on the goal of 4,000 at the end of the year. In addition, we will continue to expand our charging network advantage in the vehicle, so that more users can charge without worries.
Max: Did you all continue as you look out.
Max: Hello.
Max: Oh, Yes, yes, you got that in total now did you ship all that matter.
Max: Yes.
Max: Other Yankee candle.
Max: But we'll see.
Max: Yeah, well the gel system.
Max: Now all of that church, you don't not only on Blue Ocean.
Max: Talk a little.
Max: Well do that.
Xiang Li: In terms of auxiliary driving technology, we continue to rapidly evolve. We independently developed a new generation of auxiliary driving technology architecture, the VLA 4D model. In a single model, unify space, language, and behavioral intelligence so that the auxiliary driving system can sense, think, and adapt to the environment. The VLAC 4D model brings users a new product model and product experience. A vehicle with VLAC 4D models is a smart body that can communicate with users and understand their intentions. It becomes a driver for Tina's car, the car she sees and wants to return.
Max: Well, that's easy to do that.
Max: Well that's it.
Max: We'll do that because that will vary.
Max: That equals locally.
Speaker Change: Yeah, Yeah yeah.
Max: But he got here okay.
Max: Now if you got lucky.
Speaker Change: Will that change.
Max: How do you kind of who attended.
Max: You are right you got lucky hopeful in the tissue. So even though you have a good home.
Max: Good afternoon.
Max: Okay.
Max: Yeah.
Max: Oh sure.
Xiang Li: At the same time, our self-declared re-creation and generation cloud-based unified world model can build a real-world real-world real-world environment and support VLAC 4D models to achieve large-scale, closed-loop reinforcement learning in the real-world environment. The VLS-1 model will be released together with the Ideal i8. Later, via OTA, it will be pushed to all models equipped with AD Max high-speed auxiliary driving. We believe that the VLS-1 model will make the car a bridge connecting the physical world and the digital world.
Max: Yeah Jackson closing.
Max: When you said I'm with you number of cool things you should get a real time Pcr.
Max: <unk> Valley's Baton Rouge, you don't forget that hockey.
Max: You send them home.
Max: Oh gosh.
Max: As you can imagine that you guys saw the Portugal.
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Max: Each Chicago Civil 28, please.
Max: Doug if you could answer that.
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Max: Resulting yeah, yeah yeah.
Max: Clearly as you go through this again.
Max: Oh, Yeah, yeah yeah.
Xiang Li: In the future, we will continue to explore the deep integration of multi-modal interactions and driving decisions to provide users with a more natural driving experience. Li Xiaotongxun is also growing steadily. At the end of May, OTA promoted Li Xiaotongxun and gained a new image. and the ability to remember and get to know each family member.
Joe: One more time Joe.
Speaker Change: Jason you won't go to that doesn't mean, we're not yet.
Max: You can actually do some guy who.
Max: Okay.
Max: Yes.
Max: Thank you Joe.
Max: How are you.
Max: Got it.
Xiang Li: 理想农学还具备了agent的能力,成为用户的生活助手。理想农学还具备了agent的能力,成为用户的生活助手。 用户可以通过语音控制理想农学点餐,定做,查快递等。用户可以通过语音控制理想农学点餐,定做,查快递等。 未来,我们还将打造更加个性化的智能空间,为用户带来像家人的互动体验。未来,我们还将打造更加个性化的智能空间,为用户带来像家人的互动体验。 In April, we completed the launch of the Ideal Golden OS technology whitepaper. The first batch of codes has also been uploaded to the Taiyuan Technology Community.
Max: How did you pay the age of the movie.
Max: That's helpful.
Max: It was pretty cool.
Max: I will give you that you look how far have you done.
Max: Yeah, that's my job.
Speaker Change: Who is your partner channel yet.
Max: Got it.
Max: <unk> got enough, we don't see yet.
Max: Well, yeah, well last holiday.
Max: So.
Max: Okay.
Max: Yes.
Max: Okay.
Max: So yeah.
Xiang Li: As the world's first open-source, self-driving, autonomous vehicle operating system company, we hope that Ideal Systems OS will assist industry partners to promote joint progress. In terms of sales service network, we are fully prepared for this year's expected sales growth and new cars on the market. At the same time, we will continue to focus on the network expansion of headquarters car cities and malls. And through the White Star project, we will take a step further to increase the capacity of high-efficiency cities. As of April 30, 2025, Ideal Cars operates 500 retail centers in 151 cities across the country.
Max: Yeah, how are you.
Max: You too.
Max: Honestly the Michigan.
Max: Do you want them to be.
Max: Yeah, Hi.
Max: So what does that mean senior note she thought as well.
Max: Well since you announced your thoughtfulness.
Max: When the gallons tissue pulp.
Max: Hopefully well somehow hemo caught up.
Paul: Paul I think you have seen what's happening.
Max: Okay.
Max: Got it.
Max: Yes.
Max: Yes, that's true.
Max: You talked about could you go through this year.
Max: Yeah.
Xiang Li: In 223 cities, we will operate 500 after-sales repair centers and platform centers.
Max: So our marathon that JASO regularly.
Max: Okay.
Xiang Li: In the future, we will continue to use it as a center and use innovation as a driving force. to continue to achieve industrial leadership and create happiness for more families.
Max: Got you that Jack Yes, we do.
Max: Thank you.
Max: Italy.
Max: Sure So again higher Neogen Etame gaucher.
Max: Jackie.
Max: Jeremy you told us that bogey.
Tie Li: Next, let's welcome CFO Li Tie to introduce our financial statements in detail. Hi, everyone. This is Li Xiaonan. Thank you for joining today's conference call. In the first quarter of 2025, we delivered more than 92,000 vehicles, an increase of 15.5% year-over-year, bringing total revenues to RMB 25.9 billion. We perform strongly in the RMB 200,000 and above NEV market in China, growing at twice the market rate according to the insurance registration data from the China Automotive Technology and Research Center. As of April 2025, we have been the segment sales champion among Chinese auto brands for 14 consecutive months.
Max: That's helpful.
Max: Okay.
Max: Hi, everyone. This is Richard and thank you for joining today's conference call in the first quarter of 2025, we delivered more than 92000 vehicles, an increase of 15, 5% year over year, bringing total revenues to RMB 25 9 billion.
Max: We performed strongly in the RMB 200000 above any of the market in China growing at twice the market rate. According to the insurance registration data from the China Automotive technology and research Center.
Max: As of April 2025, we haven't been the segment sales champion among Chinese auto brands for 14 consecutive months in particular, we talk the market with a 14, 1% market share in April further reinforcing our leadership as of the end of April we have delivered more than $1 two 6 million vehicles.
Tie Li: In particular, we topped the market with a 14.1% market share in April, further reinforcing our leadership. As of the end of April, we have delivered more than 1.26 million vehicles. As a pioneer and leader in EREV, the L-Series continues to enhance user value through ongoing innovation and product iteration, maintaining a competitive edge, despite challenges from newcomers. Recently, we launched the new Li Mega and new Li L series. The refreshed Li 80 Max models receive NVIDIA's latest Thor U chip. while Li-AV Pro models upgraded from Horizon Robotics Journey 5 to Journey 6M chips and include ATL LiDAR sensors co-developed with Plus Eye as standard.
Max: As a pioneer and leader in Euro U B <unk> L series continues to enhance user value through ongoing innovation and product iteration.
Max: Hanging a competitive edge despite challenges from new cars recently, we launched the new Mega and New Lee L series, the refreshed <unk> Max models received and videos latest tour you chip.
Max: While the <unk> pro models upgraded from Horizon Robotics journey five two journey six M chips and include ATL Lidar sensors co developed with the standard and.
Tie Li: In addition to these upgrades for assisted driving, we have enhanced chassis control, exterior and interior design, and smart cockpit across the new Li-AV. On April 23, we launched Li Mega Home at Shanghai Auto Show 2025, reflecting our latest understanding of multi-generational families and their mobility. Featuring top-tier configurations for our flagship model, Li Mega Home aligns closely with our mission to create a mobile home, create happiness. Since its launch, Li Mega Home has accounted for over 90% of Li Mega orders, demonstrating its strong value proposition and user recognition. Li Mega currently has a robust order backlog with continuous inflow.
Max: In addition to these upgrades for assisted driving we have enhanced chassis control exterior and interior design and smart cockpit across the new V. L series.
Max: On April 23rd we launched lean back out home at the Shanghai Auto show 2025, reflecting our latest understanding of multi generational families and their mobility needs featuring top tier configurations for flagship model Li Mega hub aligns closely with our mission to create a mobile home create happiness.
Max: Since its launch Lee Mega home has accounted for over 90% of the Mega orders, demonstrating our strong value proposition and user recognition Lee Mega currently has a robust order backlog with continuous inflow to meet growing demand, we're increasing our production capacity to achieve $2 25.
Tie Li: To meet growing demand, we're increasing our production capacity to achieve 2,500 to 3,000 monthly deliveries by July. With the delivery of Li Mega Home, the new Li Mega Ultra and the new Li L series in May, we expect second quarter deliveries to reach between 123,000 to 128,000. The success of Li Megahome strengthens our confidence in becoming a top tier player in the premium BV market with a robust DevPep pipeline. Preparations for our upcoming event are progressing smoothly with Li-8 and Li-6 scheduled for launch in July and September respectively. VI-8 test vehicles are currently undergoing road tests across the country and have already locked over 9.5 million kilometers as part of our preparation for mass production.
Max: <unk> 3000 market deliveries by July.
Max: Yeah.
Max: With the delivery of lean Mega home, the new lean Mega Ultra and the new Li L series in May we expect second quarter deliveries to reach between 123000 228000 units.
Max: The success of lean Mega home strengthens our confidence and becoming a top tier player in the premium BV market with a robust.
Max: Pipeline preparations for our upcoming events.
Max: Progressing smoothly with V I ate and Lee I six scheduled for launch in July and September respectively.
Max: Eight test vehicles are currently undergoing an ROE types across the country and have already locked over $9 5 million kilometers as part of our preparation for Matt for mass production.
Max: And efficient and convenient charging network is critical for electric vehicle user experience to support our BV launch we have built the largest urban highway Supercharging network among all automakers in China covering over 50000 kilometers of highways as of the end of first quarter. Currently we operate two.
Tie Li: An efficient mean and charging network is critical for electric vehicle user experience. To support our BEV launch, we have built the largest urban highway supercharging network among all automakers in China, covering over 50,000 kilometers of highways as of the end of first quarter. Currently, we operate 2,350 supercharging stations equipped with over 12,800 charging stalls. Additionally, we completed the deployment of a supercharging network along 20 long-distance tourist routes, including the G318 Sichuan-Tibet Highway. We will continue to accelerate supercharging network deployment, with plans to deploy over 2,500 stations in June and aim for 4,000 stations by the end of the year.
Max: <unk> thousand 350, Supercharging stations equipped with over 12800 charging stalls. Additionally, we completed the deployment.
Max: Deployment at a supercharging I've heard a lot 20 long distance tourists routes, including the G. Through an agency they are trying to pick the best highway.
Max: We will continue to accelerate the Supercharging network deployment with plans to deploy over 2500 patients in June and aim for 4000 stations by the end of the year.
Tie Li: We will further enhance our competitive edge over other automakers on charging network going forward, ensuring a hassle-free charging experience for our We continue to rapidly develop our ADAS technology. Our in-house developed VLA driver model as our next generation ADAS architecture integrates spatial, language, and behavioral intelligence into a single model, enabling ADAS to perceive, think, and dynamically adapt to the environment. VLA driver will redefine user experience and deliver innovative product formats, transforming vehicles into smart agents capable of communicating with users, understanding intentions, and acting as dedicated drivers that can comprehend, see, and locate. Our proprietary, reconstructive, and generative cloud-based world model creates realistic simulation environments that will support the closed-loop reinforcement learning of VLA driver at scale.
Max: Will further enhance our competitive edge over other automakers on charging networks going forward, ensuring a hassle free charging experience for our users.
Max: We continue to rapidly develop our AI technology, our in house developed the VLA driver model as our next generation <unk> architecture integrates spatial language and behavioral intelligence into a single model enable enabling adas to perceive fink and dynamically adapt to the environment.
Max: The only driver will redefine user experience and delivering innovative product formats transforming vehicles into smart agents capable of communicating with users understanding intention and acting as a dedicated drivers that can comprehend C and locate.
Max: Our proprietary reconstructive generate if client cloud based world model creates realistic simulation environments that will support the close loop reinforcement learning fiala driver at scale.
Tie Li: This will drive a continuous improvement in iteration efficiency and quality. We plan to launch VLA Driver with Li-8 and then roll it out to all the AVMAX-equipped vehicles by OTA updates. We firmly believe that VLA Driver will bridge the physical and digital worlds. Going forward, we will continue exploring opportunities to seamlessly integrate multimodal interaction to deliver a more natural human-vehicle co-driving experience. Li Xiaopengxue also continues to evolve. The latest OTA update at the end of May introduced new design memory capability to recognize each family members and agent functions that allow it to act as an assistant for daily activities, such as placing orders, making reservations and tracking packages deliveries via voice and mail.
This will drive continuous improvement and iteration the efficiency and quality.
Max: We plan to launch will be all the driver of what Lee I ate and then roll it out to all the a D. Max equipped vehicles by OTH updates, we firmly believe that VLA driver will bridge, the physical and digital world going forward. We continue we will continue exploring opportunities to seamlessly integrate multimodal interact.
Max: <unk> to deliver a more natural human vehicle co driving experience.
Max: These are wholesale also continues to evolve the latest update at the end of May and introduced new design memory capabilities to recognize each family members and agent functions that allow us to act as an assistant for daily activities, such as placing orders, making reservations and tracking packages delivery.
Max: Via voice commands.
Max: Our aim is to create increasingly personalized smart space that can make human vehicle interaction as intuitive as interacting with a family member.
Tie Li: Our aim is to create increasingly personalized smart space that can make human vehicle interaction as intuitive as interacting with a family In April, we published the HALO OS technical architecture white paper and released initial code to the open source community. As the first automaker globally to open source its proprietary smart vehicle operating system, we hope to empower industry partners and foster industry-wide progress through the HALO OS.
Max: In April we published the Lee Halo O S Technical architecture, and White paper and released initial code to the open source community as the first automaker globally to open sources proprietary smart vehicle operating system, we hope to empower industry partners at Fox or industry wide progress to be paid.
Max: Oh, yes.
Max: Moving on to our sales and service network for preparing for this year is expected growth in sales at new vehicle launches, we will continue to expand our network and the major auto parts in shopping malls, while penetrating lower tier cities through the start plan to boost overall coverage efficient.
Tie Li: Moving on to our sales and servicing network, we're preparing for this year's expected growth in sales and new vehicle launch. We will continue to expand our network in the major auto parks and shopping malls while penetrating lower tier cities through the STAR plan to boost overall coverage efficiently. As of April 30, 2025, we had 500 retail stores in 151 cities nationwide, alongside 500 servicing centers and Li Auto authorized body and paint shops operating in 223 cities. Looking ahead, we remain committed to our user centric approach driven by innovation, and will continue to enhance our industry leading product strength to deliver a greater happiness to more families.
Max: As of April 32025, we had 500 retail stores and 151 cities nationwide alongside 500 servicing centers and the auto authorized body and paint shops operating in 223 cities.
Max: Looking ahead, we remain committed to our user centric approach driven by innovation and we will continue to enhance our industry, leading product strength to deliver a greater happiness to more families. I will now turn the call over to our CFO Jonny to walk you through our financial performance.
Tie Li: I will now turn the call over to our CFO, Johnny, to walk you through our financial performance.
Tie Li: Thank you, Xiang. Hello, everyone. I will now walk you through some of our 2025 first quarter financials. Due to time constraints, I will address financial highlights here and encourage you to refer to our earnings price release for further details. Total revenues in the first quarter were RMB 25.9 billion or 3.6 billion US dollars. up 1.1% year-over-year and down 41.4% quarter-over-quarter. This included RMB 24.7 billion or 3.4 billion US dollars. from vehicle sales up 1.8% year over year and down 22.1% quarter over quarter. The year over year increase was mainly attributable to the increase in vehicle delivery.
Jonny: Thank you Hello, everyone I will now walk you through some of our country.
Max: 75 first partner for Apple.
Max: It was with handsets trends I will address financial highlights here.
Max: And I encourage you to refer to our earnings press release, Paul whether email.
Max: Total revenue in the first quarter were RMB 25, nine beating all three.
Max: They compete in U S dollar.
Max: 015, 1% year over year.
Max: I'll do my fist bump that pharma will call here.
Max: This included RMB 24, seven bidding all three 4 billion U S dollar.
Max: From vehicles there.
Max: 8% year over year.
Max: And the coupon one part that partner will call here.
Max: Year over year increase was mainly attributable to the increase in vehicle delivery.
Tie Li: partially offset by the lower average selling price. mainly due to different products made. The sequential decrease was mainly due to a decrease in vehicle delivery, which was impacted by seasonal factors related to Chinese New Year holidays. Cost of sales in the first quarter will be 20.6 billion or 2.8 billion US dollars. are 1.3% year-over-year and down 41.6% cultural costs. gross profit in the first quarter was RMB 5.2 3 billion or 732.9 million US dollars. 0.6%. year over year and down 40.7%. Call her, we'll call her. Vehicle margin in the first quarter was 90.8%, versus 90.3% in the same quarter, same period last year, and 19.7% in the prior quarter.
Max: Partially offset by the lower <unk>.
Max: Right.
Max: Due to different product mix.
Max: The decrease was mainly due to a decrease in vehicle delivery.
Max: Impacted by.
Max: Even non factor related to Chinese new year holiday.
Max: Cost of sale in the partner were RMB tons.
Max: T y.
Max: Really our coupon 8 billion U S dollar.
Max: Our bond funds III like that year over year.
Max: Bottom line, we expect that to pop a little harder.
Max: Gross profit in the first quarter was RMB five.
Max: Through it all.
Max: All right.
Max: 30, <unk> 9 million U S dollar.
Max: Zero.
Max: With that.
Max: Year over year and Paul.
Max: One 7%.
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Max: Nicole margin.
Max: The first call her wallet.
Max: 8%.
Max: It's not the point.
Max: With that in the same quarter same period last year.
Max: Alan.
Alan: A 17 point, we're 97% in the prior call here.
Tie Li: The year over year increase was mainly due to cost reduction. and the pricing strategy changes in the first quarter of 2024. which were partly offset by different products made. Vehicle margin remained relatively stable over the prior quarter. gross margin in the first quarter was 20.5% versus 20.6% in the same period last year and 20.3% in the prior quarter. Operating expenses in the first quarter will be 5 billion. $695.5 million down 14% year over year and 4.2% cauter over cauter R&D intensive in the first quarter or R&D 2.5 billion or 346.4 million U.S. dollars. down 17.5% year-over-year and up 4.4% quarter-over-quarter.
Max: The year over year increase was mainly due to cost reductions.
Max: Pricing strategy changes in the first quarter of 'twenty is plentiful.
Max: Which were possibly off site.
Max: By a different product mix.
Max: <unk> margins remain relatively stable over the prior quarter.
Max: Gross margin in the fourth quarter loss.
Max: 25%.
Max: Plenty of five 6% in the same period last year and plenty of fun.
Max: So you put that in the prior call here.
Max: Yes.
Max: Operating expenses in the first quarter wont be 5 billion all.
Max: 695.
Max: 5 million U S dollar.
Max: Tom Broughton for that year over year.
Max: Ballpark toolkit that cause the overall quarter.
Max: R&D expenses in the first quarter were RMB.
Max: $2 5 billion, all 340 basis points fall meeting U S dollar.
Max: 17 pardon.
Max: That year over year at.
Max: Qualifies bulker, that's called normal calendar.
Tie Li: The year-over-year decrease was mainly due to decreased employee compensation and impact of the pace of new vehicle program. The R&D expenses remain relatively stable over the current cost. SG&A expenses in the first quarter were RMB 2.5 billion, or 300 48.8 million U.S. dollars. down 15% year-over-year and 17.7% quarter-over-quarter, the year-over-year and sequential decrease were primarily due to decreased employee compensation, improved operational efficiency, and decreased marketing and promotion activities. income from operations in the first quarter was RMB 271.7 million or 37.4 million US dollars worth is lost from operations of RMB 500 84.9 million in the same period last year and income from alterations of RMB 3.7 billion in the prior quarter.
Max: The year over year.
Max: Great wealth mandate was primarily due to.
Steve Quake: Steve Quake and E Commerce data.
Max: Impact.
Max: Also the pace of new vehicle programs.
Max: R&D expenses.
Max: Relatively stable or perhaps longer.
Max: <unk> expenses in the first quarter were RMB, two 5 billion.
Max: All 300.
Max: 48 clients acreage in the U S dollar.
Max: 15% year over year.
Max: Uh huh.
Max: Uh huh.
Max: <unk>, 7% collateral call here.
Max: Year over year and sequential decrease was primarily due to decreased unvalued condensate it improve operation operational efficiency and decreased marketing and promotion activities.
Max: Income from operations in the first quarter was RMB 27, three bond fund.
Max: Oh, sorry, Paul.
Max: Paul meeting last dollar.
Max: Loss from operations of RMB.
Max: 500.
Max: Paul.
Max: 9 million.
Max: Yeah, we had last year and income from operation at all.
Max: <unk> three 7 billion.
Max: In the prior quarter.
Tie Li: All taken marking in the first quarter of August. 1.0% versus negative 2.3% in the same period last year, and positive 8.4% in the prior quarter. That income in the first quarter was RMB. 646.6 million 89.1 million U.S. dollars, up 9.4% the year-over-year and down 81.7% quarter-over-quarter. diluted net earnings per ADF attributable to ordinary shareholders. 0.62 all 0.08 US dollars in the first quarter versus RMB 0.56 in the same period last year and RMB 3.31 in the previous quarter.
Max: Operating margin in the first of all there was.
Max: One zero debt.
Max: Active clients throughput that we in the same period last year and positive.
Max: Based upon the bulk of that in the crap out here.
Max: The economy in the first call here was RMB.
Max: It takes time to $46 6 million at all.
Max: 89, 1 million U S dollar.
Max: 95, 4%.
Max: 81, 7% comparable quarter.
Max: Yes, I will take that.
Max: Earnings per ADR actually with both who ordinary shareholder.
Max: RMB.
Max: Zero six.
Max: <unk>.
Max: <unk>.
Max: Zero point.
Max: Zero eight U S dollar.
Speaker Change: Let's call it or what the army is the euro.
Speaker Change: Five states in the same period last year and RMB three five.
Speaker Change: So everyone in this past quarter.
Speaker Change: Turning flower.
Tie Li: Turning flower, balance sheet and cash flow. Our cash position remains strong and stood at RMB 110.7 billion of 15.3 billion U.S. dollars as of March 1, 2025. Next cash used in operating activities in the first quarter was RMB 1.7 billion of 234.4 billion U.S. dollars. versus RMB 3.3 billion in the same period last year and net cash. provided by Our Beijing Activity. of RMB 8.7 billion yuan. Brett Cawthon Free cash flow was negative RMB 2.5 billion or negative 348.7 billion US dollars in the first quarter. Negative R&B 5.1 feeling in the Think Very Loud and positive R&B 6.1 feeling in the Precocious.
Speaker Change: She is on cash flow.
Speaker Change: Our tax position.
Speaker Change: And then raw food.
Speaker Change: At RMB.
Speaker Change: Well I had to attend one 7 billion.
Speaker Change: All 13 clients, where you've been in U S dollars as of March 1st.
Max: Net cash used in operating activities in the first quarter. It was RMB, one 7 billion.
Max: Why is the <unk>.
Max: 30, followed by 12 billion meeting U S dollar.
Max: Worth is RMB three 3 billion in the same period last year.
Max: Net cash.
Max: Provided by operating activities.
Max: RMB eight 7 billion.
Max: Proud to call here.
Max: We are cash flow negative RMB, two 5 billion all next day as.
Max: 48 that would be meeting U S dollar.
Max: Are we.
Max: Worth it.
Max: Negative RMB five 1 billion in the same period last year.
Max: And positive RMB.
Max: Based upon one building in the protocol.
Tie Li: And now for our business outlook. for the second quarter of 2025. The company expects to deliver delivery to be between 121,000 and 128,000 vehicles representing a year over year increase of 13.3% to 17.9% Company, awkward back. second quarter total revenue to be between RMB 32.5 billion and RMB 33.8 billion or 4.5 billion US dollars and 4.7 Billion Dollar, representing a year over year increase of 2.5% to 6.7 This business outlook reflects the company's current and preliminary view on its business situation and market conditions, which is subject to change.
Max: Now for our business outlook for.
Max: Well, it's back when the call golf ball and be funded by the.
Max: Company expects will deliver.
Max: Deliveries to be between 121000 and what is the.
Max: Plan to 8000 vehicles.
Max: Representing a year over year equally at all.
Max: Sorry for that.
Max: 17, 9%.
Max: The company also adds back.
Max: Second quarter total revenue to be between RMB 35 5 billion.
Max: RMB 33 8 billion.
Max: All fine.
Max: Five beating that.
Max: The ballpoint Devon.
Max: Bidding.
Max: Representing a year over year increase.
Max: To follow up with that tool.
Max: Thanks for.
Max: Yes.
Max: Basically it's all through the.
Max: The Companys current and preliminary view on it.
Max: Yes.
Max: Is it on the market condition, which is subject to change.
Unknown Executive: That concludes our prepared remarks.
Max: That concludes our prepared remarks, I will now turn the call over to our paper and start our Q&A session.
Unknown Executive: I will now turn the call over to our speaker and start our Q&A session. Thank you. We will now begin the question and answer session. If you wish to ask a question, please press star 1 on your telephone and wait for your name to be announced. If you wish to cancel your request, please press star 2. If you are on a speaker phone, please pick up the handset to ask your question. For the benefit of participants on today's call, please limit yourself to two questions. And if you have additional questions, you can re-enter the queue.
Max: Thank you we will now begin the question and answer session.
Max: I'll ask a question. Please press star one on your telephone and wait DNA to be announced.
Max: If you wish to cancel your request please press star two.
Max: If you're on a speakerphone please pick up the handset to ask your question for.
Speaker Change: For the benefit of participants on today's call. Please limit yourself to two questions and if you have additional questions you can reenter the queue.
Unknown Executive: If you are a Mandarin speaker, please ask your questions in Chinese first, then follow with English translation.
Max: If you are a Mandarin speakers. Please ask your questions in Chinese first.
Max: And then follow with the English translation.
Tim Hsiao: Your first question comes from Tim Hsiao with Morgan Stanley.
Speaker Change: First question comes from Tim Hsiao with Morgan Stanley.
Speaker Change: Uh huh.
Tim Hsiao: Hello, I am Tim from MorningStandard. Thank you for accepting my question. I have two questions. The first question is related to the score we got this year. After the launch of the L-series, the market was very enthusiastic. But we also noticed that after the Shanghai Motor Show in April, many of our competitors quickly compared the L-series with more competitive prices and specifications. So looking forward to the second quarter and the second half of the year, how will the L-series remain? As Mr. Guan just said, the goal is to double the market share by more than 200,000 this year, and then continue to get the market share.
Max: The only thing you can catch up with the.
Max: Now we would have lyndsey, Steve Lindsey I see you're continuing down because I'm sure he'll call. Each other today I wish you the same buying some such a host it's also need to pay down debt.
Speaker Change: Hello, My question has to be done.
Speaker Change: And Joe Ho Hum.
Speaker Change: Welcome to the general industrial production can be seen with Jaco quick question I'll take that.
Speaker Change: D C J long argued different opinion.
Speaker Change: He says Oh, Gee Uh huh.
Speaker Change: But he says it'll show that you're taking on some basis, especially so TTS is going to go says it will be off balance sheet issues should help us.
Tim Hsiao: My first question is about the bottom growth, because Li Auto's the new L-series has received great market feedback. But in the meantime, we also noticed that competitors are trying very hard to benchmark the L-series with much more aggressive pricing and specs. So how would Li Auto keep growing vehicle sales two times faster than the overall high-end market throughout the rest of the year and keep getting market share at expenses of peers in China? That's my first question. Thank you.
Speaker Change: My first question is about the Portland grows.
Speaker Change: Because of the auto as the new <unk> has received great market feedback.
Speaker Change: But in the meantime, we also noticed that competitors are trying very hard.
Speaker Change: <unk> benchmark the L series space much more aggressive pricing and spat. So how is the auto keep growing because sales two tiny factor.
Speaker Change: Uh huh.
Alec: Hi, I'm like kit get Alec.
Speaker Change: The rest of the year and keep gaining market share headaches as expenses appears in China. That's my first question. Thank you.
Liangjun Zou: Hello Tim, I am Liangjun Zou, let me answer your first question. After the launch of the new version of the car model, sales performance meets our expectations and shows positive growth. 目前美洲的销量已经超过了1万台,5月份其实截止到目前,在20万以上,NEV的市占率我们已经达到了14.7% We are confident that the car model will soon return to the level of 50,000 units a month. After we launched the new VL series, its sales performance met our expectations and has shown healthy growth. Our weekly sales are now over 10,000 units, and months to date, our market share in the RMB200,000 and over and higher NEV market has reached 14.7%. We're very confident the monthly deliveries of our new L series will return to the 50,000 per month level pretty soon.
Speaker Change: Yeah.
Speaker Change: So, let's say that it is a diesel engine.
Speaker Change: Okay.
Speaker Change: So he is does the whole Chinese negotiators, who may be cheap P. J T J Kim.
Speaker Change: What can be the older children in total.
Speaker Change: Hello, This is cumulative downloads yet balanced the way they.
Speaker Change: You beat US because then you will need to do.
Speaker Change: That business is cheap.
Vishal: He was he gave us plenty of my associates Sonya just to clarify Vishal, one Harris VP.
Vishal: Okay.
Vishal: After we launched a new V. L series sales performance met our expectations and has shown healthy growth.
Vishal: Weekly sales are now over 10000 units and month to date, our market share in the RMB 200000 over at higher LTV market has reached 14, 14.97%.
Vishal: We're very confident the monthly deliveries of our new al serious about returning to that 50000 per month level pretty soon thank you.
Vishal: Okay.
Vishal: Okay. So you know what the O N E.
Liangjun Zou: Thank you.
Liangjun Zou: My second question is about the products. When will Li Auto consider selling sedans? So my second question is about the products. With the current SUV lineup, when will Li Auto consider selling sedans? Will the company also adopt a dual powertrain strategy to include both ER-EV and BEV for a sedan product line to cater to a broader consumer base? That's my second question.
Jonathan: Jonathan <unk> launches to talk.
Jonathan: Are you talking to us and so much of your time with colleagues in gene and cell sources now separately, what do you tell me more SUV now Sheila ICT this on Saturday.
Jonathan: So my second question is about the products.
Jonathan: To karen's SUV lineup, when we can be auto consider selling sedans.
Jonathan: Company also adopt to powertrain strategies, which include both <unk> BV course, again bottom line to catch up to that.
Jonathan: Consumer base. That's my second question. Thank you.
Liangjun Zou: Thank you.
Jonathan: That's what what should ease out.
Xiang Li: Hello, I am Li Xiang. In our current judgment, we think that after the integration of SQA and pure SQA, and Lijia Mega, and after the overall exchange, we think that the upstream can support the scale of our annual revenue of 300 billion yuan. After we reach this scale, including our products, we will also launch more affordable MPVs and cars based on the real market demand. These products will also be the main products that we are looking for, including China and important Asian and European markets. In our view, with Li Mega, the Li Range Extended SUV Series, and the Li Best SUV Series in full sales production, we can reach up to 300 billion RMB in terms of revenue.
Speaker Change: Okay. Thank you Pablo.
Jonathan: Yeah.
Jonathan: Oh, so I'm trying to isolate.
Jonathan: Now, let's do it.
Jonathan: And I got to meet with you all.
Speaker Change: Oh really.
Speaker Change: Oh, okay.
Jonathan: Thank you Charles.
Jonathan: Well unless you get the Albania turnkey that until that we more yeah.
Jonathan: Yeah no good.
Jonathan: Oh, Yeah, Oh, I'm, Italian, but let's call. It normal that you didn't you didn't use us to show the whole.
Jonathan: Absolutely true.
Speaker Change: Capitalism solicited MTV deltas.
Jonathan: And I'll tell you a M King air play offshore.
Jonathan: Oh boy.
Jonathan: Hum going out the door she.
Jonathan: So with that at all.
Jonathan: In our view with Lee Mega the lead range extended SUV serious and be best as you'll be serious and full sales production.
Jonathan: We can reach up to 300 billion RMB in terms of revenue and after we reach that level of revenue scale, We will review.
Xiang Li: And after we reach that level of revenue scale, we will review, based on user demand and market conditions, when to launch sedan models and MPV models covering a more affordable price range. And these products in combination will also be offered not only in China, but also other Asian markets and European markets.
Jonathan: Based on user demand and market conditions.
Jonathan: Went to launch a sedan models and MPV models, covering a more affordable price range.
Jonathan: And these products are in combination will also be offered not only in China, but also other Asian markets and European markets.
Unknown Executive: Thank you. Thanks a lot for sharing all the insights and information.
Jonathan: Yeah.
Speaker Change: Thank you thanks, a lot for sharing everything inside selling information. Thank you.
Unknown Executive: Thank you.
Speaker Change: Your next question comes from <unk> Securities.
Yingbo Xu: Your next question comes from Yingbo Xu with SciTech Securities. Hi, I'm Yingbo Xu from Zhongxin. I have two questions. First, we see a lot of people are looking forward to Xinhuang OIF. Can you give us more details about it? First, how should we expect to improve the level of smartization? Second, what are the costs? What are the considerations for reducing the cost? What are the benefits? Third, since everyone is familiar with AutoSoft, what are the actual differences and improvements?
Speaker Change: Okay.
Speaker Change: On that she said Juanita once you Johnson, Michigan.
Speaker Change: Yeah.
Speaker Change: And then just on the $10.
Speaker Change: So she's like I don't see that.
Speaker Change: So that number in a moment.
Speaker Change: You saw it go from here not because of shortages that you know you got so much she got because I did see some jargon.
Speaker Change: Do you want your from United States from Monday evening somehow touches each at midnight you from your second half, we'll see you on you could call me.
Speaker Change: Sure. Let me just I'm going to just what you meant by that time well do they take on all this all be all shows in the country that should get us to the trulia.
Speaker Change: Let's see sudden fish, a month of which about LNG I E.
Yingbo Xu: Let me bring up the second question. The second question is that we see that the i8 and i6 have been planned for a while. This is actually a question about the product. If we look at the existing L6 and L8, can we compare the understanding of the car product and the difference in customer image? Compared to L6 and L8, if we look at i8 and i6 in the future, what is our core competitiveness in the pure market? How can we better gain the recognition of consumers?
Speaker Change: So Scott Macdonald change all of them come out with like a Basel I know don't know she can go pilots pneumonia.
Speaker Change: So you got a bunch of you know once you.
Speaker Change: So it's a much younger woman.
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Speaker Change: I got to imagine that's just going to talk to them.
Speaker Change: So a couple of things.
Speaker Change: Yeah.
Speaker Change: Someday I don't know how Alabama.
Speaker Change: Hey, Bob I know with the Fox XP.
Speaker Change: I don't want my magic.
Speaker Change: Sure something something then Goku hotdogs, whether it sounds like there wasn't cool.
Yingbo Xu: I have two questions. The first one is about HelloOS. Could you please give us more colors about the intelligence level and how to cut in cost and the difference between AutoSAR and HelloOS?
Speaker Change: So I have two questions on the first one is about.
Speaker Change: Hello, Olaf could you please give us more colors about that's our intelligence level and how to cutting costs and or that difference between auto Saar and Hello Olaf.
Yingbo Xu: The second question is about products. For L6 and L8, what is the real difference between their users? In the future, how about i8 and i6? How can they win consumers in the BEV market?
Speaker Change: Second question about Florida.
Speaker Change: Or L shape, an L H, what's the real difference between their users.
Speaker Change: So how about I H I suppose.
Speaker Change: From day one.
Speaker Change: Consumers in the U a.
Speaker Change: E D market. Thank you.
Yingbo Xu: Thank you. Hi, Yingbo. This is Ying. I will answer your first question. Right now, we are seeing strong interest in our Halo OS from three main types of companies, automakers, chip manufacturers, and other ecosystem suppliers. In fact, some of these suppliers have already started contributing code to the open source community. For us, the stronger the overall industry ecosystem becomes, the faster we can iterate on our own products and technologies. As our partners grow in capability and collaborate with us more closely, we also see meaningful cost efficiency. And as the open source community matures, our investments in certain areas can be reduced, allowing us to focus more resources on what truly set us apart, our core strengths.
Speaker Change: Hi.
Speaker Change: This is Jim I will answer your first question.
Speaker Change: Right now we are seeing strong interest in our halo as far as three main types of comedies automakers chip manufacturers and other ecosystem suppliers. In fact, some of these suppliers have already started contributing code to the open source community.
Speaker Change: For us the stronger the overall industry ecosystem becomes the faster we can iterate on our own product and the technologies as well as our partners grow and capability and collaborate with us more closely.
Speaker Change: We also see meaningful cost efficiency.
Speaker Change: And as the open source community matures, our investments in certain areas can be reduce allowing us to focus more resources on what's truly set us apart our core strengths.
Speaker Change: And at the same time, our operating system gave us a unique opportunity to vertically integrate hardware and software and algorithm capabilities.
Yingbo Xu: At the same time, our operating system gives us a unique opportunity to vertically integrate hardware, software, and algorithms capabilities. Over time, we're confident this will allow us to continuously enhance The AI User Experience on Hadoop.
Speaker Change: Overtime, we are confident.
Speaker Change: Allow us to continuously enhance.
Speaker Change: The AI user experience all kind of ways.
Yingbo Xu: So how does Halo OS compare to AutoSAR? First of all, Halo OS can fully replace the core functionalities of standard AutoSAR operating systems. On top of that baseline, Halo OS brings significant advantages in areas where traditional AutoSAR OS doesn't do very well, such as more efficient resource usage and a true end-to-end time-determined. What is more, by redefining the system architecture, we are able to address some of the limitations of the relatively heavyweight autosoft framework, especially when it comes to enabling faster, more agile innovation.
Speaker Change: So how does heyday O S compared to all of them first of all Hello S came fully replace the core functionality yourself standard auto SAR operating system on top of that the baseline. It always brings significant advantages in areas, where traditional auto whereas the other two.
Speaker Change: Well.
Speaker Change: Such as more efficient resource usage and a true end to end title determinism.
Speaker Change: What is more by redefining the system architecture, we're able to address some of the limitations of the relatively heavier weight, although some framework, especially when it comes to enabling faster more agile innovation. Thank you.
Yingbo Xu: Thank you.
Speaker Change: Okay.
Speaker Change: Uh huh.
Liangjun Zou: Yingbo, let me answer your second question. First of all, the positioning of Ideal Automobiles is a medium-high-end brand. So for us, the upgraded group, mainly after the upgrade, is our most important user group. Specifically, the upgraded model is a solution for the fuel car preservation group. This is the Ideal L6 and L8 mentioned in your questionnaire. So the pure model is an upgraded solution for the new energy preservation group. This is also the most important market for us after we launch the Ideal I8 and I6 in the second half of this year. Second, we estimate that the market cap of more than 200,000 NEVs this year will be around 3.8 million.
Speaker Change: Yeah.
Speaker Change: Yeah.
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Speaker Change: Give me two Goldman came back.
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Speaker Change: Simple movies, where their data <unk>.
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Speaker Change: Associates.
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Speaker Change: Premier's switches as EMEA chili, there's Bollywood centric if you will.
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Speaker Change: <unk>, Hey, Bob Oh.
Speaker Change: Please go out and see what it says.
Speaker Change: The mcgary well neither leukemia huh.
Speaker Change: Hey, we need to see.
Speaker Change: Okay.
Speaker Change: Okay.
Speaker Change: Your line is live.
Speaker Change: Kidney ph D V C.
Liangjun Zou: She's a PhD. is 2.13 million. From this, we can see that after we launch the pure electric car model, we will enter a larger market space.
Speaker Change: You bet as to what is the basis.
Speaker Change: I used to someone.
Speaker Change: Could you basically kind of.
Speaker Change: And then three through 10 gig switches so that gets.
Speaker Change: We have to.
Speaker Change: So quickly here.
Liangjun Zou: Thank you. The Li Auto brand is positioned as a premium brand. Therefore, additional purchases and upgrades is a big part of our customer base. So specifically, our range extended models are catered towards customers who currently own ICE models as an upgrade to ICE. whereas BEV models are upgrades for NEV car owners. So I-8 and I-6 will be targeted towards the current ownership base of NEV cars. And our expectations for this year is that the overall NEV market, over R&D 200,000, will be about 3.8 million units this year. And among which, 1.69 million will be PHAPs and 2.13 million will be VAPs.
Speaker Change: Oh I see.
Speaker Change: The Lee Auto brand is positioned as a premium brand and therefore additional purchases and upgrades.
Speaker Change: Big part of our customer base, so specifically.
Speaker Change: Range extended models are catered towards customers, who currently own ICT models as an upgrade to IC models, whereas B V models are upgrades for an EV car owners. So I ate a 96 will be targeted towards.
Speaker Change: Current ownership base.
Speaker Change: In unit cost.
Speaker Change: And we our expectations for this year is that.
Speaker Change: Overall, an EV market over 200 to RMB 200000 will be about $3 8 million units this year, and our Mon, which $1 six 9 million well P. P half and 2.13 million will be bats, therefore by introducing <unk> models will be taken into a bigger market.
Liangjun Zou: Therefore, by introducing BEV models, we'll be taking it to a bigger market.
Unknown Executive: Thank you.
Speaker Change: Okay.
Speaker Change: Yeah.
Speaker Change: I guess just yet.
Tina Hou: 好的,谢谢 Okay, thank you Your next question comes from Tina Hou with Goldman Sachs.
Speaker Change: Your next question comes from Kian <unk> with Goldman Sachs.
Kian <unk>: Hi management, Thanks for taking my questions.
Tina Hou: Hi, management. Thanks for taking my questions. So I have two questions. The first one is regarding our balance sheet. So just wondering, what is our target leverage ratio?
Kian <unk>: So I have two questions. The first one is regarding our balance sheet. So just wondering what is our target leverage ratio and also sort of what is our payable payable cycle, including in some of the banks those bills payable to the supply chain.
Tina Hou: And also sort of what is our payable cycle, including some of the bank bills, bills payable to the And then the second question is regarding our upcoming I-8, the BEV model. So could management share with us what do you think is the biggest selling point and advantage versus other BEV models in the same segment? Thank you for accepting my question.
Kian <unk>: And then the second question is regarding our upcoming.
Kian <unk>: Upcoming I ate the SaaS model, so could management share with US why do you think is the biggest selling point and advantaged versus other.
Kian <unk>: Best models in those same segments.
Kian <unk>: Oh, well Nico things out on one Guy says when he says he will.
Tina Hou: I have two questions. The first one is about the leverage rate of our goal and the payment cycle of the supplier. For example, what is the level of the bank transfer?
Glenn: I'll, let Glenn.
Kian <unk>: Sure Glenn do you want and Oh, sorry, Okay, Yeah Devin.
Speaker Change: Got leach easy to equal your Shonda Foochow T. J do you feel about how you're doing in Hollywood Calgon, Dallas, and Doug I'd say Ya man. The shape you know how do you have the win T shirts that wage element Chisholm I shall saputo at by women do try again, the SUV what are you telling them away do quite sure whether you go to the other gingerly.
Tina Hou: The second question is about the i8, our pure electric SUV, which will be released in July. What do you think is the main competitive advantage and selling point of this car? Thank you. Okay.
Speaker Change: Sure, we'll do at other media as you said about how those guys yet.
Speaker Change: Okay.
Johnny Tie Li: Yeah, this is Johnny. I'll take the first question. We are very committed to maintain good relationships with supply supplier We strive to maintain the palatable taste at a reasonable and healthy level. are basically ranging from two to four months. So if you see our payable date at the end, it's because there are some reconciliation days need to be spent after. unquote. We will finally... I can tell the balance with At the end of Q1, the payable balance didn't change much compared with the end of last year. So the quarter over quarter increase in the paper days was mainly due to the due to the lower cost of sales.
Speaker Change: Yeah.
Speaker Change: Gotcha.
Speaker Change: I'll take the first question.
Speaker Change: Very committed to maintain good relationships with.
Speaker Change: Bye bye.
Speaker Change: So by our partner.
Speaker Change: We we ascribe to maintain the payable days back a reasonable and healthy level.
Speaker Change: Basically.
Speaker Change: From a total.
Speaker Change: Omar So if you see our payable days.
Speaker Change: Yeah.
Speaker Change: Because there are some discrepancy.
Speaker Change: Reconciliation.
Speaker Change: It needs to be spent after we will extend the plasma.
Speaker Change: Finally.
Speaker Change: Uh huh.
Speaker Change: Does that get filed about us with.
Speaker Change: Our suppliers by the end of Q1, the payable balance hasn't changed much confirm it.
Speaker Change: At the end of last year.
Speaker Change: So the cause of all cause a unique rate payable days.
Speaker Change: It was mainly due to that.
Speaker Change: Pegylation.
Speaker Change: And I thought we should do it for the lower cost of sales in the first call.
Speaker Change: Thank you.
Xiang Li: Hi, I'm Li Xia. I'd like to talk about the advantages and disadvantages of the i8. In addition to our latest VLAC model, i8 has an innovative design that satisfies the maximum space and uses the effective assembly to achieve the lowest power consumption. At the same time, I think i8 will have a stability that everyone is very satisfied with, and the comfort of the whole family. In addition, in terms of charging, the i8 is 6G in 1G. We did it for 10 minutes, and then 500 kilometers of high-voltage charging technology can be achieved on the i8.
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Xiang Li: And we can provide more than 2,500 supercharging stations when we deliver. And these supercharging stations are built around the urban environments where our front-line owners live. There was young chicken I believe you. I believe Zero Gauge 8 can provide excellent ways for the current CIU players to upgrade their vehicles. So, to brief a few points on IAID's key selling points. Apart from the VLA driver model, which I mentioned earlier, IAID also has a very innovative styling, exterior and interior. And the exterior styling is really designed around smart packaging to allow for the most space inside as well as a very low drag coefficient.
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Speaker Change: Apart from the VLA driver model, which I mentioned earlier I E. It also has a very innovative.
Speaker Change: Styling accurate injured and the extra styling is really designed around smart packaging to allow for the most basic inside as well as a very little drag coefficient and in the meantime, I also offers very good handling and ride comfort apart from that I E. It also supports charging up to <unk>.
Xiang Li: And in the meantime, IAID also offers very good handling and ride comfort. Apart from that, I-8 also supports charging up to 500 kilometers in 10 minutes with this high-voltage charging technology. And by the time we launch I-8, we also would have built 2,500 supercharging stations to prepare for the launch of I-8. And all these charging stations are built around the surrounding and the travel routes of our potential customers. So we have reason to believe that the I-8 will be a top choice for existing owners of any of these cars as a replacement or upgrade to their current model.
Speaker Change: 500 kilometers in 10 minutes I went as high voltage charging technology and by the time, we launch I H will also would have.
Speaker Change: Built 205 to 2500, Supercharging stations and prepare for the launch of <unk>.
Speaker Change: And all these charging stations are built are bound.
Speaker Change: And they're a traveler out of our potential customers. So we have reasons to believe that the I H, we wont be a top choice for existing owners and UV cars at the replacement or upgrade to their current model.
Speaker Change: Thank you.
Speaker Change: Thank you ladies and gentlemen.
Jing Chang: 感谢管理层的分享 感谢管理层的分享 Your next question comes from Jing Chang with CICC. Thank you for accepting my question. My first question is about our sales target and some trend outlooks. Will we set a more clear sales target this year? Or will we adjust our volume and price flexibly based on market changes? In the long run, Shixian has also made some calculations. Based on some recent market changes, do we have any changes in the market capacity of mid-to-high-end SUVs, including some home-used ones? This is my first question. It's regarding to our sales target and also some trends outlook.
Speaker Change: Your next question comes from Tim Chiang with CIC.
Speaker Change: Okay.
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Speaker Change: So this is my first question is regarding 12 ourselves target and also some trends.
Jing Chang: Will we set up a clear sales target this year? Or will we flexibly adjust our volume and price strategy according to the market changes? And also in the longer term, previously we have our calculations about the market size. And given the changes in recent two years, have there been any changes in our adjustment?
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Speaker Change: Fox Lake adjust our volume and our price strategy according to them the changes.
Speaker Change: And also in the.
Speaker Change: Longer term previously a half hour our calculation is about the market size and given the changes in recent two years have had there been any changes in our adjustments.
Jing Chang: So regarding to the mid-to-high-end SUVs and especially family-targeted cars, what's our mid-term sales target in the domestic market?
Speaker Change: So regarding to regarding to the meet high end, Suvs, and especially families Harvey cars so whatsoever.
Speaker Change: Midtown South park in domestic market.
Liangjun Zou: Hello, Tianjin. I'm Liangjun Zou. I'll answer your first question. As before, we hope that the sales increase in the next 2.5 years will be 2 times the increase in the new energy market and car market, which is more than 200,000. Unknown Speaker 1, 2, 3, 4, 5, 6, 7, 8, 9, 10, 11, 12, 13, 14, 15, 16, 17, 18, 19, 20, 21, 22, 23, 24, 25, 26, 27, 28, 29, 30, 31, 32, 33, 34, 35, 36, 37, 38, 39, 40, 40, 41, 42, 42, 43, 44, 44, 45, 46, 47, 48, 49, 50, 51, 52, 53, 54, 55, 56, 57, 58, 59, 60, 60, 61, 62, 63, 62, 63, 64, 65, 66, 67, 67, 68, 69, 69, 70, 71, 71, 72, 71, 72, 71, 72, 72, 73, 74, 75, 75, 76, 76, 77, 78, 78, 79, 79, 80, 80, 80, 80, 80, 80, 80, 80, 80, 80, 80, 80, 80, 80, 80, 80, 80, 80, 80, 80, 80, 80, 80, 80, 80, 80, 80, 80, 80, 90, 80, 80, 80, 80, 80, 80, 80, 80, 80, 80, 80, 90, 80, Thirdly, in terms of market demand, let me give you an example.
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Liangjun Zou: The domestic market space is still very large. For example, in four or five cities. Recently, we announced the 100-Storey Restoration Project. This project will help us strengthen our coverage in the four and five-storied cities. In the past year, we have actually done some surveys in some four and five-storied cities, mainly because we used to focus on the first, second and third-storied cities. Let me give you an example of our surveys in the past. For example, in Zigong and Dazhou in Sichuan, Since the opening of these two cities in September last year, in less than half a year, we have obtained 28% of the market share of PV products over 200,000 yuan.
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Liangjun Zou: In Shanxi and Yan'an, This is also a five-tiered market in China. We also achieved a 25% P-base ratio of more than 200,000 in Yan'an. Because the penetration rate of new energy vehicles has begun to exceed 50%, more and more consumers are willing to buy new energy vehicles. At the same time, because of the launch of the L6 model since last year, we have seen a greater market opportunity in the 15-tier cities. So we will further promote our recycling plan this year to bring new volume to sales. Our goal is to implement a recycling plan for 100 cities in the 15-tier cities this year.
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Liangjun Zou: We hope that in 2026, the expansion in the 15-tier cities will bring us more than 100,000 market volumes.
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Speaker Change: And what kind of its holistic.
Liangjun Zou: Thank you. As we've communicated before, we expect our growth in 2025 to be double the growth rate of overall RMB 200,000 and above NEV market. And in terms of energy type, as we launch our BEV models, we'll be taking it to a bigger town. As I mentioned earlier, the overall market of NEV over 200,000 RMB and more is 3.8 billion this year expected, and 2.1 million, which is BEV. So our new BEV model launches will take us into this bigger market. And in terms of market demand, we think there's still great potential, and I'll give one example with Tier 4, Tier 5 cities.
Speaker Change: I see.
Speaker Change: As we've communicated before we expect our growth in 2025, it could be double the growth rate overall at RMB 200000, a pop and EV market.
Speaker Change: And in terms of energy type as we launch our BV models will be taken into a bigger Tam.
Speaker Change: And earlier.
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Speaker Change: It is $3 8 billion fiduciary expected and to point out 1 billion, which is bad so our new bass model launches will take us into the bigger market.
Speaker Change: And in terms of market demand. We think there is still a great potential and I'll give one example, with Pierre Fabre tier four tier five cities, we've recently announced and what we call Sard program.
Liangjun Zou: We've recently announced what we call STAR program, which will expand our coverage in Tier 4 and Tier 5 cities. And we ran some pilot programs last year in these Tier 4 and Tier 5 cities, like, for example, in Sichuan, Dazhou, and Zigong, both of which are Tier 4, Tier 5 cities. And since we've opened our stores in last September, in less than half a year, we've reached over 28% market share in all passenger vehicle markets, over 200,000, regardless of energy type. And another example in Shaanxi, Yan'an, we've also reached 25% market share in all PV market, over RMB 200,000 and above.
Speaker Change: Which to bulk.
Speaker Change: Spanned our coverage in tier four and tier five cities and we brought some pilot programs last year and these tier four and tier five cities for example.
Speaker Change: So we're trying to agile and silver both of which are tier four tier five cities and since we've opened our stores in la.
Speaker Change: Last September.
Speaker Change: In less than half a year, we've reached over 28% market share in all passenger vehicle market is over 200000, regardless of energy type and.
Speaker Change: In another example in Shanxi God. We've also reached 25% market share in all of our PV market over RMB 200000 laptops.
Liangjun Zou: And as the overall penetration rate of NEB reaches over 50%, more and more users are choosing new energy vehicles. And also, as we launch L6 and other models, we are seeing bigger opportunities in Tier 4 and Tier 5 cities. So this year, we'll continue to expand our STAR program and bring incremental sales to the company. So our goal is to expand...
Speaker Change: And as the overall penetration rate up and you'd be reaches over 50% more and more users are choosing new energy vehicle and also as we launch our fixed and other models, we're seeing bigger opportunities and tier four and tier five cities. So this year well continue to expand our start program.
Speaker Change: And bring incremental sales to the company. So our goal is to expand to.
Liangjun Zou: a hundred cities this year in tier four, tier five cities and bring in 100,000 incremental sales in 2026.
Speaker Change: 100 cities this year and tier four tier five cities.
Speaker Change: Bringing in.
Speaker Change: 100000.
Speaker Change: Incremental sales in 2026.
Speaker Change: Uh Huh Kev Windsor Bonnie Cashin.
Liangjun Zou: Okay, my second question is about the auxiliary driving. Yes, and Mr. Li Xiang has also explained in detail how we do the BLA in the second AI Talk. We talked about the 4G model, pre-training, reinforcement learning, and so on. Can you explain to us in more detail what we think are the core difficulties? How do we maintain this differentiation and lead? So my second question is regarding to AD. So Mr. Li Xiang elaborated in detail in how we do BLA in the previous AI Talk. Talking about our driver-launched model, several progress including the pre-training of the foundation model and the different types of the reinforcement learning and etc.
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Liangjun Zou: So what's core difficulties do you think are there and how we do to differentiate ourselves from peer companies?
Speaker Change: How difficult is to think are there and how we do to differentiate ourselves from peer companies.
Liangjun Zou: Hello, my name is Ma Donghui. The pre-training of the VLT model and the post-training of VLA, the enhancement training of RLHF and RL, The four steps are to train an old driver's sense of security. The most difficult part is the pre-training of VL and the reinforcement learning of RL. This is also a problem that all enterprises are solving. 然后在VLT做模型预训链当中,我们通过增加特定的视频数据,然后让模型拥有对于三维空间智能的理解能力。 而这有别于其他的只有对于两维理解能力的金融游戏 In addition, to strengthen learning with RL, we need to constantly innovate in a real environment and continue to work hard on VLAT. We rely on the combination of reconstruction and production to develop the world model for the pursuit of physical world order.
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Liangjun Zou: 并且覆盖出所有交通参与者和要素。 Based on the accuracy of the anti-theft ability, the VRXE model can accurately verify the problem of reality and the model's replacement cycle is significantly optimized. Our training process for basically replicating an experienced driver is divided into four steps. Step one is training what we call a VL foundational model, pre-training. Second step is post-training into a VLA model. And then is reinforced learning with human feedback, or RLHF. And finally, RL, reinforced learning. And this is how we train an experienced driver through AI. And the hardest part of all this is the pre-training, which is the VL foundational model, as well as the last step, the reinforced learning step.
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Speaker Change: Our training process for.
Speaker Change: Basically it's replicating a experienced driver is divided into four steps.
Speaker Change: One is training what we call. It E L foundational model pre training second Cyprus post training into a BLA model and that is reinforced learning with human feedback our L. A shaft and finally are out.
Speaker Change: First learning and this is how we train.
Speaker Change: Curious driver through AI and the hardest part of all this is that true.
Speaker Change: Pre training, which has to be all foundation model as long as well.
Speaker Change: Alaska the reinforced learning stuff. This is a problem at all.
Liangjun Zou: This is a problem, though, that all enterprises are trying to solve. So first of all, in the VL foundational model training process, we're trying to add specific video data so that the foundational model can understand three-dimensional space, as opposed to other models, which only understand 2D space. This is a key differentiation of our foundational model. And then in reinforced learning, it requires us to train the model in real-world simulated environments to iterate the VLA model and improve its capabilities. So through reconstruction and generative processes and a combination of these two methods, we can build world models that actually follow the laws of physics in the real world and replicate traffic participants and other elements.
Speaker Change: That all enterprises are trying to solve.
Speaker Change: So first of all in the V L foundational model training process.
Speaker Change: We're trying to add a specific video data. So so that the foundational model can understand three dimensional.
Speaker Change: Space as opposed to other models, which only understanding I understand two days too.
Speaker Change: <unk> space. This is a key differentiation of our foundational and then reinforced learning.
Speaker Change: It requires us to train the model and real world simulated.
Speaker Change: Environments.
Speaker Change: To iterate that we always model and improve its capabilities, so through reconstruction and generated processes and combination of these two methods, we can build or a bottle that follow actually follow the physical losses.
Speaker Change: Alas physics, and the real world and replicate traffic participants and the other element so with very accurate simulations capabilities severely driver model can train very at very low cost and very accurately verify real issues and assimilate it world model.
Liangjun Zou: So with very accurate simulation capabilities, the VLA driver model can train at very low cost and very accurately verify real issues in a simulated world model, and it can also significantly reduce the iteration period.
Speaker Change: And I can also significantly reduced the iteration period. Thank you.
Unknown Executive: Thank you.
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Bin Wang: 好的,谢谢 Okay, thank you 好的 Okay 好 Your next question comes from Bin Wang of Deutsche Bank. Thank you. I have two questions. The first is about the profit margin and the second is about exports. In terms of profit margin, can you explain the factors that improve our gross profit margin in the first quarter? Because we see that there is a change in price and so on. What exactly is it? At the same time, can you tell us what the trend will be in our gross profit margin in the second quarter? We see that after the launch of new products, we have received some refunds and discounts.
Speaker Change: Okay.
Dan Wang: Your next question comes from Dan Wang with Deutsche Bank.
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Bin Wang: Can you tell us if the gross profit margin in the second quarter will recover?
Speaker Change: Paul.
Bin Wang: The second is exports. We have some plans for exports. Can you tell us when we can have more than 1,000 exports in a month? Thank you. Let me translate it. I got two questions. One is about your gross margin and the second one is about the export. In the first quarter, you actually enjoyed the margin expansion. You mentioned that pricing strategy change. Can you provide more detail about this strategy change? Meanwhile, what's your outlook for the second quarter? Basically, we think that when you launch a new system, you actually reduce the cash subsidy. We assume your margin will actually increase in the second quarter.
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Speaker Change: I've got two questions.
Speaker Change: Gross margin in the second line is up on the asphalt.
Speaker Change: Last quarter you actually.
Speaker Change: The margin expansion you mentioned is that pricing strategy change can you provide more detail about this.
Speaker Change: Exchange. Meanwhile, what's your outlook for the second quarter.
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Speaker Change: I just have to see how can we assume you're much annual increase in the second quarter. Thanks, Paul The second question I'll ask Paul to you.
Johnny Tie Li: And for the second question about export, you previously said this year will be the starting point for export. Do you think when a meaningful volume will emerge for the export business, when you can start to say monthly export volume exceeds 1,000 units? Thank you. I think our first, we expect the vehicle margin to still remain around 19% for the second quarter. As you know, the second quarter is, we have April and May. The Mega is not there. And as of today, we have a lot of new Mega home, all their home handsets are still will still start a huge volume delivery.
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Speaker Change: Mostly asked but wondering if you can see the 1000 units. Thank you.
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Liangjun Zou: just talking from this week. And also it's a switch from the old 2024 workshop, L-series to 2025, so it's a combination.
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Liangjun Zou: Chief Committee Commander-in-General. Hello, I'm Liangjun Zou. I'm here to answer your second question about Chuhai. First of all, we can only provide hardware products at the same time. After social services and software smart services, we will really enter a market. Because what we sell is the end of the era of artificial intelligence. It's not just a product trade. In the next few years, we will focus on Asian and European markets. In these areas, we are recruiting mature salesmen. At the same time, we are also accelerating the process to select a group of excellent people from within the company to join the overseas market team.
Speaker Change: The vehicle market.
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Liangjun Zou: At the same time, we are also actively attracting talents with international experience to join our team. Third, Overseas markets are a long-term strategy for us. We hope to continue to work hard to achieve a 30% total sales volume for overseas markets. Thank you. We have three prerequisites for entering an overseas market or enter any market, which is offering a good hardware. And second is being able to provide after sales support. And third is provide smart software services. Only when we meet these three conditions can we enter a new market because we consider ourselves to be selling AI-era terminals as opposed to just selling physical products.
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Speaker Change: We have a free prerequisite for entering in overseas Marvel and hear any market, which is offering a good hardware and second yes.
Speaker Change: <unk> provides heart after sale support and third is to provide smart software surfaces only when we meet these three conditions can we enter a new market because we consider ourselves to be selling AI here terminals as opposed to just selling physical products over the next few years, we'll be focusing on Asia and European markets and Ricky.
Liangjun Zou: Over the next few years, we'll be focusing on Asian European markets and recruit established distributors across these countries. In the meantime, we're also stepping up our efforts. Identify and assign top talents, internal talents, to our overseas market team, while also recruiting actively professionals with international experience to join our international team. Overall market, overseas market is a part of our long-term strategy, so we'll be working very hard and with a goal of reaching 30% of overall sales overseas. Thank you.
Speaker Change: Fruit established distributors across these countries and to me in the meantime, we're.
Speaker Change: We're also stepping up our efforts to.
Speaker Change: Identify and assign top talents internal talents to our overseas market team.
Speaker Change: While also recruiting actively pursue.
Speaker Change: First off with international experience to join our international team.
Speaker Change: Overall market overseas market.
Speaker Change: Part of our long term strategy. So we will keep working very hard and with a goal of reaching 30% of overall sales overseas. Thank you.
Speaker Change: Thank you.
Speaker Change: Yes.
Speaker Change: Your next question comes from Paul Gong with UBS.
Paul Gong: Our next question comes from Paul Gong with UBS. Thank you for answering my question.
Paul Gong: Just wanted to ask you on Cowen <unk> co.
Paul Gong: I have two questions. The first one is about the VLA launch time. The second one is about the Megahome. As I said just now, the VLA model will be released at the same time as the i8. I want to confirm that this means that consumers can use it in July. Recently, the government has tightened restrictions on auxiliary driving. Do we need more testing time to ensure its safety and usability?
Paul Gong: <unk> got to Santiago, So Michael Holmes two of them.
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Ashwin: Thanks, Ashwin I supposed to Tokyo.
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Ashwin: On nickel young adult market.
Speaker Change: When we treat in both lines will start to feel to Cook, which was asked of Tony Somma, you'll hit it switching to Asia, Jim Guar Otoole shall come toward that youre going to the gym.
Ashwin: Boston proper.
Christian: Christian Thank you talked the Eagle.
Paul Gong: The second question is about the Megahome. I should say that this sale is very promising compared to the previous Megahome. What kind of insights can we learn from this? Let me translate. So my first question is regarding the VLA timing for availability to the consumers, especially given the tightening of the regulation on the driving assistance recently by the government. Do we need more time to verify it? Or are we still confident that it would be available for consumers to use in July?
Christian: There's also a technical win consequently, Michael Holmes.
Speaker Change: And cash flow.
Speaker Change: So it sounds like Vishal sufficient that you can make on the fly so please hold.
Christian: Let's hope they want me with just the amount that you are shifting.
Christian: Chris concentration.
Christian: So my first question is regarding the <unk>.
Christian: Timing for <unk> with our consumers.
Christian: Especially given the.
Christian: Tightening of the regulation, that's driving our system recent today by the governments do we need more time to verify yet or are we still confident that tie it to whats available for consumers to you will see in July. The second question is regarding the implication of my thoughts on this.
Paul Gong: The second question is regarding the implication of Megahome. This has definitely shown some improvement from the previous Megasales. And what do you think are the lessons learned? And what would be the lessons for the upcoming i8 and i6 launch?
Christian: Definitely show some improvement on the previous make ourselves and so what do you think caused that message.
Christian: What would be the.
Christian: Lessons for the upcoming <unk> and IFC.
Christian: I see.
Christian: Okay.
Ma Donghui: Hello, I am Ma Guogui. I will answer the first question. We will still keep VLA as a major model in July. We will release ICOE-I8 as soon as possible. And we will launch IDMAP fully in August. and go to the event in general discussion within the middle phase. We think it is very necessary for regulators to manage the safety of service providers. In fact, we think this kind of management is even better for companies that rely on technology. For us, our super technology will solve the security problem. In the development process, we always put safety first in all things.
Christian: Well sure.
Christian: They are eagerly.
Christian: Oh, well either economy as you well know.
Christian: You don't have the boxes are cute she go.
Hudson: So Hudson, Yeah, Hey, Bob.
Hudson: Awesome.
Christian: Thank you.
Christian: I'm not sure not too soon.
Christian: Yes.
Christian: It's actually neither eshop.
Christian: Okay.
Christian: Yes.
Christian: But when we really think about it from catastrophe.
Christian: Let me say this will be all.
Christian: Let's see.
Christian: Cubans wont be attached to them when theyre going to Asia goodwill.
Christian: And I told.
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Ma Donghui: Home-based management will not have a negative impact on the release and development of our VIA. We're still on track to releasing our VLA driver model in July together with our battery electric SUV, i8, then be rolling out VLA driver to all of our users. August. And obviously, that our drivers can all our customers can also experience the only driver in our in test drives in all of our stores. We view regulations on safety and assisted driving to be absolutely necessary. And in fact, we view stringent regulations to be more favorable to companies with solid technical fundamentals.
Christian: I think in Denver.
Christian: Do you want to.
Christian: He didn't get involved tangibly dataset.
Christian: We're still on track to releasing our VLT driver model in July together with our battery electric SUV I ate.
Christian: Oh, that'd be rolling out the only driver and through all of our users in August and.
Christian: Obviously, our drivers can all our customers can also experience the only driver.
Christian: That strikes me at all of our stores, we view regulations at two.
Christian: Safety.
Christian: And this is driving to be absolutely necessary and in fact, we view stringent regulations to be more favorable to companies with solid technical fundamentals. So for Lee auto are Super alignment technology will address many of the safety concerns.
Ma Donghui: So for Li Auto, our super alignment technology will address many of the requirements and allow us to prioritize safety at the top consideration in all development stages. Enhanced regulatory regulations requirements will not hinder our R&D efforts.
Christian: I would prioritize safety at the top consideration and all development stages.
Christian: Enhanced regulatory regulatory regulations requirements will not hinder our R&D efforts. Thank you.
Leah: And Leah.
Xiang Li: Hello, I'm Li Xiang. We used to sell about 1,000 copies a month. We predicted that the sales of the golden version would increase by 50%.
Leah: Oh Mitre 10, Oh man.
Leah: Yes, Jonathan.
Leah: Yes.
Leah: No.
Leah: Oh I see.
Leah: Okay.
Leah: Okay. Please go ahead.
Leah: Okay.
Xiang Li: But in reality, the sales increased by more than 1.5%. We will work hard to achieve a steady flow rate of 2,500 to 3,000 per month and ensure continuity.
Speaker Change: And then that should either drop off she said it should've been on that hold them back.
Speaker Change: So you know what my Heartbeat.
Speaker Change: Hum Moshe yet.
Speaker Change: Now turning to us and Canada.
Speaker Change: And I'm sure. She got you yeah.
Xiang Li: In the past year, after facing some difficulties in MyFa, I think the biggest change is that we don't pay attention to the desire for competition, and we don't focus on the value of users or family members because there are more and more competitors entering the market in various fields. I think if we can continue to innovate in this direction, and look to the future, I think the biggest opportunity is to experience innovation in the mobile space. We are just getting started. There are countless products that give people technological experience, which can be realized. Not only on the hardware, but also on the result of artificial intelligence technology.
Speaker Change: Good day holiday of course to the E 100 that matter.
Paul: Thank you Paul.
Paul: You can see that as being a lot.
Paul: I'll give you a friend who withdrew team doing that you are holding in there.
Alex: Alex You said you made a.
Paul: Being able to do so.
Speaker Change: Do I say that.
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Paul: Archie.
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Speaker Change: Hey come on.
Speaker Change: How we should Oh Gee, the how we should Oh, David I can you didn't have any type of increase you should yes, I'll take the easy in a union shop.
Speaker Change: Longer than usual.
Speaker Change: And those you don't know.
Xiang Li: I hope that in the future, when we talk about interoperability, the best company in the world is Apple. So in fact, our previous steady rate of mega-deliveries was about 1,000 per month, and our expectation was for it to increase by 50% with the launch of the new model. But in fact, it eventually increased by over 150%, significantly exceeding our expectations. And obviously, we hope to increase production capacity to maintain a steady-state delivery rate of 2,500 to 3,000 as we expect.
Speaker Change: As I laid out a lot.
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Speaker Change: So how does that sound all that changes.
Speaker Change: Yeah sure so you'll remember we hit on that as well.
Speaker Change: Condensed the entity as a whole the whole Sheila I'll try to do it I don't think that's a beautiful socially distanced yourself.
Christian: So in fact, our previous steady rate of Mega deliveries. It was about 1000 per lot and our expectation was for it to increase by 50% with the launch of a new model, but in fact it eventually.
Christian: Increased by over 150% significantly exceeding our expectations and obviously, we hope to increase production capacity to keep maintain a deliberate steady state it very rate of 25 to 500 to 3000.
Christian: We expect.
Xiang Li: So as we look back at the previous year and how we got to where we are today, we... realized the most important thing was not to focus on our own internal desires or focus too much on the competition or on specific market segments on which competitors entered this market and do things based on our fear. But in fact, we return to the users that focus on the family users and what they actually need and how we can surpass what they were looking for or other products or offering in the market and innovate around their needs.
Christian: So as we look back at the previous year and how we got to where we are today.
Christian: We do.
Christian: Realize the most important thing was not to focus on our own internal desires or focus too much on the competition or a specific market segments on which cup had predators entered this market.
Christian: And do things based on our fear, but in fact, we returned to the users that focus on there.
Christian: The family user than what they actually mean and how we can.
Christian: Surpass.
Christian: They were looking for our other products are offering in the market and innovate around their needs. So one opportunity that we see as we see the success with the new Mega homeland won't be done.
Xiang Li: So one opportunity that we see as we see the success with the new mega home and what we've done with the explorations we did last year was really this opportunity around mobile space. There's so many things that we can do to innovate around this mobile space experience. And there's so much exciting product features that we're exploring because. We hope the car going forward is not the experience, not going to be just focused on hardware, but actually an integrated AI experience enabled by hardware and software. So looking forward, we know when we talk about user machine interaction, we think of Apple as a company that does it best in the world.
Christian: Exploration as we did last year was really this opportunity around the mobile space Theres. So many things that we can do to innovate around this mobile space experience and theres. So much exciting product features that we're exploring.
Christian: Because we.
Christian: We hope the car car going forward is not.
Christian: Experience is not going to be just focus on hardware, but actually and over.
Christian: Integrated AI experience enabled by hardware and software. So looking forward, we know when we talk about user machine.
Christian: Interaction, we think of Apple as a company that does it best in the World. We hope that when people talk about space experience people think of leak in the future. Thank you.
Unknown Executive: We hope when people talk about space experience, people think of Li in the future. Thank you very much. Thank you.
Christian: Thank you very much thank you.
Speaker Change: As we are reaching the end of our conference call now I'd like to turn the call back over to the company for closing remarks, Ms. Jenny Zhang. Please go ahead.
Janet Zeng: As we are reaching the end of our conference call now, I'd like to turn the call back over to the company for closing remarks.
Janet Zeng: Ms. Janice Zhang, please go ahead. Thank you once again for joining us today. If you have further questions, please feel free to contact Li Auto's investor relations team.
Christian: Thank you once again for joining us today, if you have further questions. Please.
Speaker Change: Feel free to contact me out of Investor relation relations team.
Unknown Executive: This concludes today's conference call. You may now disconnect your lines. Thank you.
Christian: Concludes today's conference call you May now disconnect your lines. Thank you.
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