Li Auto Inc. reported August 2025 vehicle deliveries while preparing for the launch of its new Li i6 battery electric SUV and the OTA 8.0 software update featuring the VLA Driver large model. These strategic moves aim to reinforce the company's position in China's dynamic new energy vehicle market amidst evolving financial performance and intensifying competition.

U.S. listed Li Auto Inc. (NASDAQ: LI) announced it delivered 28,529 vehicles in August 2025. This brings the company's cumulative deliveries to 1,397,070 as of August 31, 2025. Concurrently, Li Auto has outlined plans for two significant September launches: the Li i6 battery electric SUV and the OTA 8.0 software update, which incorporates the VLA Driver large model. These developments underscore Li Auto's strategic initiatives to enhance its product portfolio and technological capabilities within China's competitive electric vehicle market.

The Event in Detail

In August 2025, Li Auto maintained a notable delivery volume of 28,529 vehicles, contributing to its substantial cumulative figure. Looking to September, the company is poised to introduce the Li i6, a new battery electric SUV anticipated to be priced between approximately RMB250,000 and RMB300,000. This five-seat SUV boasts a 3-meter wheelbase and advanced technical specifications, including an 800V architecture, a 5C battery, and acceleration from 0 to 100 km/h in under 4 seconds. The Li i6 is strategically positioned to attract premium buyers and compete with established luxury models such as the Mercedes-Benz GLC and BMW X3.

Beyond product expansion, Li Auto will also roll out OTA 8.0 in September. This software update is set to deliver the company's proprietary VLA Driver large model to all Li AD Max users and introduce an evolved Li Xiang Tong Xue Agent. These advancements are designed to enhance the vehicle's autonomous driving capabilities, leveraging all-weather LiDAR and advanced artificial intelligence to create a "thinking" system that anticipates driver needs. Supporting its market presence, Li Auto currently operates 543 retail stores across 156 cities, 536 servicing centers, and 3,190 super charging stations equipped with 17,597 charging stalls in China.

Analysis of Market Reaction and Broader Context

The announcements from Li Auto come at a critical juncture for the company, as it navigates a dynamic and increasingly competitive new energy vehicle (NEV) landscape. While new product and technology advancements typically foster positive market sentiment, the ultimate investor reaction will hinge on the successful reception of these new offerings.

Recent financial disclosures indicate challenges for Li Auto. The company reported a 4.5% year-on-year revenue decline to RMB30.2 billion in Q2 2025, falling short of expectations. Vehicle margin for the quarter stood at 19.4%, influenced by interest subsidies and sales incentives. Furthermore, the Q3 2025 delivery forecast suggests a substantial 37.8%–41.1% year-on-year drop, with projected revenue between RMB24.8 billion and RMB26.2 billion, representing a 38.8%–42.1% decline. This follows a period where Li Auto experienced its third consecutive month of sharply declining figures in August, with its 28,529 deliveries notably lower than rival Nio's 31,305 battery electric vehicle deliveries in the same month.

This trend for Li Auto contrasts with the broader Chinese EV market, which recorded a new annual high in August 2025, with 1.395 million units of electric cars and plug-in hybrids registered, marking a 27% increase compared to the previous year. Pure electric cars, in particular, demonstrated robust growth, with 908,000 units sold, a 40.5% increase year-over-year.

The launch of the Li i6 is therefore viewed as a strategic imperative for Li Auto's growth revival. The company's prior reliance on extended-range electric vehicles (EREVs) appears insufficient to sustain growth, making the success of the Li i6 vital for its transition to full electrification. While Li Auto possesses substantial cash reserves of RMB110.7 billion to support this strategic shift, the expansion into battery electric vehicles (BEVs) carries potential risks of margin dilution, as EREV models historically yielded higher margins (19.8% in Q1 2025).

Expert Commentary

Li Auto's CEO, Li Xiang, has characterized the i6 as a "highly competitive product" distinguished by its unique design and performance. However, industry analysts remain cautious. Barclays, for instance, has highlighted the inherent execution risks within the margin-eroding BEV sector. The success of the i6 will be measured not only by its market entry but also by its ability to stabilize monthly deliveries within the 18,000-20,000 unit range, a critical benchmark for restoring investor confidence.

Looking Ahead

Investors will be closely monitoring the market reception and delivery performance of the Li i6 in the coming months, particularly against the backdrop of Li Auto's Q3 guidance and September delivery figures. The efficacy of the OTA 8.0 update and its VLA Driver large model in differentiating Li Auto's autonomous driving capabilities will also be a key factor. The success of these strategic initiatives is paramount for Li Auto to solidify its market share, navigate intensifying competition, and potentially reverse recent negative financial trends in China's rapidly evolving new energy vehicle sector.