Feb 8, 2023
China’s Li Auto Launches Electrified SUV to Rival Tesla Model Y
(Bloomberg) -- Beijing-based Li Auto Inc. unveiled an extended-range electrified sport utility vehicle it wants to rival cars like Tesla Inc.’s Model Y.
The L7, introduced during an online event Wednesday, has a starting price of 319,800 yuan ($47,100) and a maximum driving range of 1,315 kilometers (817 miles). The five-seater can cover about 210 kilometers purely electric but also has a four-cylinder gasoline engine to provide additional power for greater range.
“The L7 will redefine a family five-seater SUV and bring an entirely new journey for three-people families,” Li Auto’s Founder and Chief Executive Officer Li Xiang said, adding that deliveries are expected to start as soon as March 1st.
The L7 is Li Auto’s fourth so-called new-energy vehicle, a classification that includes fully electric cars and plug-in hybrids. The other three are six-seaters. Following Apple Inc., Li Auto named the three variants under its latest model as L7 Air, L7 Pro, and L7 Max, which are equipped with different sensors, storage, intelligent driving hardwares, and so on.
In terms of pricing and design, the L7 is being positioned to take on models including the Audi Q5, Mercedes-Benz GLC and BMW X3, as well as Tesla’s Model Y. Many potential buyers have owned Model 3 or Model Y cars, preliminary pre-orders show, Li said in a post on his Weibo social media account in January.
Still, Tesla’s recent price cuts on its Chinese-made vehicles have brought the starting cost of the Model Y down far lower than the L7, to 259,900 yuan.
Tesla isn’t alone in slashing prices on its cars as the EV market grows increasingly competitive. Chinese brands including Xpeng Inc. and Huawei Technologies Co.-backed Aito have also reduced theirs in recent months. Li Auto cut prices on some of its early models to clear inventory and avoid competing against its own newly-launched models.
Even with Covid disruptions and an economic slowdown, retail sales of NEVs almost doubled to 5.67 million in China last year, according to Passenger Car Association data. Li Auto delivered 133,246 vehicles, an increase of 47% from 2021, helped by the addition of its L9 and L8 SUVs. The company’s first SUV model is the Li One.
In the meantime, rather than solely relying on battery giant and Tesla supplier Contemporary Amperex Technology Co., Li Auto will work with local battery manufacturer Sunwoda Electronic Co. and Svolt Energy Technology Co. Ltd. on self-developed battery packs, which will be installed in the basic Air versions of L7 and L8, the CEO said.
Li Auto, founded in 2015, may have to wait until 2024 to record its first annual operating profit, according to Bloomberg Intelligence, a year later than consensus estimates.
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