Li Auto lowers prices on first electric SUV one week after its launch

Li Auto, China’s first all-electric sport utility vehicle, has slashed the price of its Li i8 up to RMB 20,000 ($2,782) only one week after it was launched. According to TechNode, Li Auto’s salespeople are also trying to increase the number of test drives at their showrooms due to lower-than-expected customer demand.

What it means: This move is made at a time where the Li i8 may follow in the footsteps Li Auto’s first electric model, the Mega. The Mega was a major failure when it was launched last March, largely due to its controversial design. Li Auto has been selling hybrid EVs with extended ranges (EREVs), but the demand for their older and less diversified models is slowing down.

• Li Auto CEO Li Xiang stated on Tuesday, in a livestream broadcast on Douyin (TikTok’s Chinese sister app), that the company had received more than 30,000 reservation with RMB 5,000 refundable deposit. Sun Shaojun of CarFans, a consumer behavior research agency, said that only 6,000 customers converted their reservations into orders during the first week after the car’s launch on July 29.

Details Li Auto announced on Tuesday that it would only offer one version of the car, rather than the three it had previously announced, and reduced the price of i8 Max to RMB 339,000 ($47,266). According to a Chinese announcement, customers can still choose the i8 Ultra as the top-end model by selecting features and options for the Max variant. The total cost will be RMB 349.800, RMB 20,000 less than before.

The entry-level i8 Pro is no longer offered, with its smaller battery pack and basic driver functions. Li Auto reported that the base version accounted for less than 2% reservations. The company will refund or exchange those who booked the Pro.

The company is having a hard time convincing consumers to take the i8 out for a test-drive, China Auto Think Tank reported on Monday. Tuesday, a Li Auto representative encouraged a TechNode reporter to take a test-drive.

The context is: Li Auto faces strong competition from NIO as both companies launched their large, family-oriented crossovers last week. The company’s Hong Kong listed shares fell 5.3% on Tuesday.

• NIO’s more affordable and roomier Onvo L90 has gained traction. Sales of the Onvo brand grew 143% week-by week to 3,697 vehicles in the week between July 28 and August 3. Jefferies analysts wrote a note on August 5th. Li Auto’s sales of 5,471 vehicles, a 26% drop from the previous week, underperformed the market.

Read more: A battle erupts between China’s NIO, and Li Auto, over three-row SUVs.

Jill Shen works as a technology reporter in Shanghai. She covers Chinese mobility and autonomous vehicles. Connect with her via e-mail: [email protected] or Twitter: @jill_shen_sh More by Jill Shen