Li Auto Inc. (LI): Business Model Canvas [Dec-2025 Updated]

You're looking at how Li Auto Inc. (LI) is navigating a massive shift in 2025, moving hard into pure Battery Electric Vehicles (BEVs) while still leaning on their Extended-Range (EREV) success, which helped them post a 20.1% gross margin. Honestly, this isn't just about selling cars; it's a complex playbook built on proprietary tech, a massive direct sales footprint across 157 Chinese cities, and heavy R&D spending to fund the pivot. We need to see if their family-focused value proposition and dual-supply chain strategy can keep vehicle sales revenue-which hit RMB 28.9 billion in Q2 2025-growing despite the high costs of infrastructure buildout. Dive in below to see the full nine-block breakdown of this strategy.

Li Auto Inc. (LI) - Canvas Business Model: Key Partnerships

You're looking at the core relationships that keep Li Auto Inc. moving forward in this hyper-competitive EV landscape. Honestly, their strategy hinges on deep, technical alliances, especially in software and batteries, which are the two most expensive parts of the car right now.

Nvidia for Autonomous Driving Computing Platforms (DRIVE Orin)

Li Auto Inc. relies heavily on Nvidia Corporation for the 'brain' of its intelligent driving systems. The current fleet utilizes dual NVIDIA DRIVE Orin™ processors. This setup delivers a combined computing power of 508 TOPS (Tera Operations Per Second) to enable full-scenario autonomous driving capabilities. This is a significant step up, considering a single Orin SoC can achieve 200 TOPS, with dual chips theoretically reaching 400 TOPS for Level 4 assistance.

Looking ahead, Li Auto Inc. has already selected the next-generation centralized car computer, NVIDIA DRIVE Thor™, to power its future software-defined vehicle fleet. This move signals a commitment to future-proofing their autonomous stack, as Thor is designed to deliver up to 2,000 TOPS of performance.

CATL and Sunwoda as Dual-Battery Suppliers for BEV Models

Securing a stable, high-quality battery supply is non-negotiable, so Li Auto Inc. has strategically dual-sourced its power packs from Contemporary Amperex Technology Co. Limited (CATL) and Sunwoda Power Technology Co., Ltd. CATL remains the primary supplier, having signed a five-year comprehensive strategic cooperation agreement on September 18, 2025. To be fair, this deepens a relationship where cumulative deliveries of vehicles equipped with CATL batteries have already surpassed 1 million units.

The partnership with Sunwoda has evolved into a more integrated structure. Li Auto Inc. and Sunwoda jointly established a new entity, Shandong Li Auto Battery Co., Ltd., with an equal 50:50 capital contribution ratio. This joint venture focuses on the production and sales of lithium-ion power batteries, supporting Li Auto's self-developed battery strategy, which is led by an internal R&D team of over 200 members. As of the latest data, approximately 400,000 cumulative deliveries used Sunwoda batteries, bringing the total from these two key partners to about 1.4 million units out of the company's total cumulative deliveries of 1,431,021 as of September 30, 2025.

Here's a quick look at the scale of these battery relationships:

Partner	Type of Agreement/Structure	Cumulative Units Supplied (Approximate)	Battery Technology Mentioned
CATL	Five-year Comprehensive Strategic Cooperation Agreement (Signed Sept 2025)	1,000,000+	Ternary Lithium, M3P, LFP, Sodium-ion
Sunwoda	50:50 Joint Venture (Shandong Li Auto Battery Co., Ltd.)	400,000	Ternary Lithium (e.g., 90.1 kWh 5C for i8)

Component Suppliers for Extended-Range Electric Vehicle (EREV) Systems

While Li Auto Inc. is a pioneer in EREV technology, it's increasingly bringing core EREV components in-house to control costs and differentiation. For instance, the company recently announced the start of mass production for its self-developed silicon carbide (SiC) power modules at its Suzhou Semiconductor Production Base. These modules are intended for the company's Battery Electric Vehicle (BEV) models launching in 2025, but the underlying technology development directly supports the efficiency and performance of their EREV range extension systems as well. The EREV lineup currently includes the L6, L7, L8, and L9 crossovers.

Dealer Partnerships for Initial International Expansion in Regions like the Middle East

Li Auto Inc. has established a dedicated division for international markets, making 2025 its first official year for overall overseas launch, focusing initially on the Middle East and Central Asia. The strategy has shifted toward recruiting local, authorized dealers to manage sales, moving away from an initial plan for direct stores to ensure flexibility and avoid alienating partners. The target markets include the United Arab Emirates and Saudi Arabia.

The groundwork for this expansion includes establishing physical presence:

• Established directly operated service centers in the United Arab Emirates (UAE) last year (2024).
• Established directly operated service centers in Kazakhstan and Uzbekistan last year (2024).
• Opened its first overseas research and development center in Munich, Germany, in January 2025.

The company is committed to supporting these partners by providing original spare parts and technical support to ensure overseas customers receive service levels comparable to domestic customers.

Finance: draft Q4 2025 cash flow projection incorporating expected international sales ramp by next Tuesday.

Li Auto Inc. (LI) - Canvas Business Model: Key Activities

You're looking at the core engine driving Li Auto Inc.'s strategy right now, which is a heavy, almost relentless focus on in-house technology development while managing a challenging sales environment. The key activities are centered on maintaining a technological lead, especially in software, and scaling infrastructure to support their BEV push.

In-house R&D for proprietary EREV and BEV technologies

Li Auto Inc. continues to pour capital into its proprietary technology stack, even when quarterly financials show pressure. This commitment to in-house development is a non-negotiable activity for their long-term positioning against pure BEV rivals. For the third quarter of 2025, Research and development expenses reached RMB 3.0 billion (US$417.8 million), which was a 15.0% increase year-over-year. This spending fuels the parallel development of their core EREV range extension systems and the newer BEV platforms.

The focus areas for this R&D investment include:

• Proprietary range extension systems for EREVs.
• Innovative electric vehicle technologies for BEV models.
• Smart vehicle solutions, including the core operating system.

Manufacturing and assembly of premium family SUVs and MPVs

Manufacturing activity is currently focused on balancing the established EREV lineup with the ramp-up of new BEV models like the Li i6. The company is actively working to increase production velocity for its newer electric offerings to counter declining sales in its older EREV series. Deliveries for the third quarter of 2025 totaled 93,211 vehicles, a 39.0% year-over-year decrease. Still, they are planning for significant capacity increases.

Here's a look at recent delivery performance and near-term production goals:

Metric	Value	Date/Period
Q3 2025 Total Deliveries	93,211 vehicles	Q3 2025
November 2025 Deliveries	33,181 vehicles	November 2025
Q4 2025 Delivery Expectation	100,000 to 110,000 vehicles	Q4 2025 Outlook
Li i6 Monthly Production Capacity Goal	20,000 units	Early 2026

The company's cumulative deliveries reached 1,495,969 units as of the end of November 2025. This manufacturing activity is critical, as the Q3 2025 results showed a net loss of RMB 624.4 million, marking a return to loss since Q4 2022, partly due to lower vehicle deliveries.

Developing advanced autonomous driving software (e.g., MindVLA architecture)

A major key activity is the continuous development and deployment of their proprietary intelligent driving stack. Li Auto Inc. unveiled its next-generation autonomous driving architecture, MindVLA (Visual-Language-Action), in March 2025 at NVIDIA GTC 2025. This is designed as a 'robot large model' unifying spatial, linguistic, and behavioral intelligence. The architecture uses a 3D spatial encoder and a diffusion model to generate optimal driving trajectories on-vehicle.

The development is immediately translated into vehicle functionality through rapid software deployment:

• OTA 7.0 rollout in January 2025 brought all-scenario end-to-end highway/urban smart driving.
• The Li L series and Li MEGA had received a total of 43 OTA updates as of the end of April 2025.
• The company planned to release OTA 8.1 in early December 2025.

Expanding and operating the self-built high-power charging network

To support the push into BEVs, Li Auto Inc. is aggressively expanding its proprietary high-power charging infrastructure, aiming to operate the largest fleet of superchargers among Chinese automakers. This infrastructure is being built out in parallel with their EREV focus.

As of the end of November 2025, the network statistics looked like this:

Infrastructure Component	Count	Coverage/Scope
Super Charging Stations	3,614 (or 3,650)	Covering 279 cities in China
Super Charging Stalls	20,027	As of November 30, 2025
Total Charging Services Provided	Over 21 million	To date

The company is prioritizing the construction of 5C supercharging stations, which can charge 500 kilometers of range in 10 minutes, with a peak power of 520 kW. This network is also open to vehicles from other brands.

Continuous Over-The-Air (OTA) software updates, like the upcoming OTA 8.1

The commitment to continuous software improvement is a core operational activity, treating the vehicle as a constantly evolving smart device. Every controller unit, from infotainment to the electric drive control unit, is designed to be updated via OTA. This high-frequency update cadence differentiates Li Auto Inc. from many traditional automakers. The upcoming OTA 8.1, planned for early December 2025, is expected to improve performance and features for existing drivers. Updates are pushed in batches, can be scheduled by the user via the Center Display or the Li Auto app, and require the vehicle to have over 8% battery charge to begin.

Finance: draft 13-week cash view by Friday.

Li Auto Inc. (LI) - Canvas Business Model: Key Resources

You're looking at the core assets Li Auto Inc. is relying on right now to keep its growth engine running, especially as the EV market gets brutally competitive. These aren't just assets; they're the foundation supporting their EREV (Extended-Range Electric Vehicle) strategy and their push into pure Battery Electric Vehicles (BEVs).

Proprietary EREV technology to mitigate range anxiety is central. This is the core intellectual property that lets Li Auto Inc. sell vehicles that don't require drivers to constantly hunt for a charger, which is a major selling point in China's vast geography. They are also building out BEV platforms in parallel, showing a dual-track technology resource commitment.

The financial muscle is defintely visible on the balance sheet. As of June 30, 2025, Li Auto Inc. maintained a robust cash position of RMB 106.9 billion, which translates to about US$14.9 billion. This capital is crucial for funding the aggressive R&D necessary to stay ahead in vehicle intelligence and product expansion.

Speaking of R&D, the investment pace is high. For the second quarter of 2025, Research and development expenses totaled RMB 2.8 billion, a sequential increase from RMB 2.5 billion in Q1 2025. The company previously guided that its AI investments for the full year 2025 would exceed RMB 6 billion.

The product portfolio itself is a key resource, especially its margin profile. The vehicle margin for Q2 2025 stood at 19.4%, which is considered relatively stable compared to the prior quarter's 19.8%. This margin strength, achieved through cost reduction efforts, helps fund ongoing operations and expansion, even as the average selling price faces erosion.

To support sales and service, Li Auto Inc. has built out an extensive direct network across China. This physical footprint is a significant barrier to entry for competitors. Here's a snapshot of that infrastructure as of late 2025:

Resource Metric	Latest Reported Figure (As of Nov 30, 2025)	Previous Reported Figure (As of Jun 30, 2025)
Retail Stores	544	530
Servicing Centers	556	511
Super Charging Stations	3,614	2,851
Charging Stalls	20,027	15,655

The self-built super charging network is growing rapidly, hitting 3,614 stations and over 20,000 stalls by the end of November 2025. This infrastructure is key to supporting both their EREV and the newer BEV models like the Li i6 and Li i8.

The key physical network components include:

• Retail presence in 157 cities as of November 30, 2025.
• Authorized body and paint shops operating in 227 cities as of November 30, 2025.
• The company is also expanding its physical presence internationally, opening its first overseas retail center in Uzbekistan.

Finance needs to track the cash burn from operations, as net cash used in operating activities for Q2 2025 was RMB 3.0 billion, leading to a negative free cash flow of RMB 3.8 billion for that quarter.

Li Auto Inc. (LI) - Canvas Business Model: Value Propositions

You're looking at the core reasons customers choose Li Auto Inc. over the growing field of electric vehicle makers. It's about delivering a specific, high-value experience tailored for families, which has translated into real market share, even amidst recent headwinds.

Premium, family-focused vehicles designed as a mobile home

Li Auto Inc.'s stated mission is to 'Create a Mobile Home, Create Happiness' (创造移动的家, 创造幸福的家). This proposition centers on creating a spacious, comfortable environment for family travel, not just transportation. The Li MEGA Home, for instance, was reported to be selling approximately 3,000 units monthly as of the second quarter of 2025. The company aims to have a model portfolio by 2025 consisting of one super flagship vehicle, five EREVs, and five HPC BEVs.

EREV models offering long range and eliminating range anxiety

Li Auto Inc. pioneered the commercialization of Extended-Range Electric Vehicles (EREVs) in China, directly addressing range anxiety for long-distance family trips. While this technology is central, the market is shifting; in October 2025, all four of Li Auto Inc.'s EREV models saw monthly deliveries plummet over 60% year-on-year. This highlights the dual nature of this value proposition-a current strength facing near-term competitive pressure from pure Battery Electric Vehicles (BEVs).

Advanced smart features and Level 2+ Advanced Driver Assistance Systems (ADAS)

The in-car intelligence is a key differentiator. Li Auto Inc. is advancing its proprietary ADAS architecture, the VLA Driver, which is a Vision-Language-Action large model designed for seamless vehicle-user interactions. This focus on in-house development aims to deliver a perception, decision, and planning capability similar to a human driver.

High safety standards and spacious, comfortable interiors

Commitment to safety is demonstrated through third-party evaluations. For the Li ONE model, Li Auto Inc. achieved the highest safety rating, G, in three out of four evaluation categories from the China Insurance Automotive Safety Index (C-IASI) in 2021: occupant safety, pedestrian safety, and assistance safety. The focus remains on providing a safe, convenient, and refined in-car experience.

Competitive pricing in the RMB 200,000+ premium NEV segment

Li Auto Inc. maintains its leadership by focusing on the premium end of the market, specifically vehicles priced at RMB 200,000 and above. In the second quarter of 2025, the company captured a 13.4% market share in the NEV greater than RMB 200k segment. By the third quarter of 2025, Li Auto Inc. commanded a 17% market share in China's premium SUV segment (RMB 200,000+). The launch of the Li i6 battery electric SUV on September 26, 2025, was also positioned within this high-margin segment.

Here's a quick look at the financial scale supporting these value propositions through the first three quarters of 2025:

Metric	Q1 2025 Value	Q2 2025 Value	Q3 2025 Value
Total Revenues	RMB 25.9 billion	RMB 30.2 billion	RMB 27.4 billion
Vehicle Deliveries	92,864 units	110,000 units	93,211 units
Vehicle Margin	20.5%	19.4%	Vehicle Gross Margin was 20.9% (Q3 2025)
Cumulative Deliveries (End of Period)	N/A	Over 1.36 million	1,431,021 (as of Sep 30, 2025)

The company's infrastructure supports these offerings through an extensive network:

• Retail stores in China: 530 as of June 30, 2025.
• Retail stores in China: 542 as of September 30, 2025.
• Super charging stations in operation: 3,420 with 18,897 charging stalls as of September 30, 2025.

Li Auto Inc. (LI) - Canvas Business Model: Customer Relationships

You're building a premium brand in a hyper-competitive EV market, so your customer relationships have to be rock solid, especially since you're selling high-ticket items. Li Auto Inc. focuses on a high-touch, integrated approach to keep owners satisfied from showroom to service bay.

Direct sales model ensuring consistent brand experience

Li Auto Inc. uses a direct sales model, meaning they control the entire customer journey without relying on independent dealerships. This is key for maintaining brand consistency, which is vital when you've already achieved 1,495,969 cumulative deliveries as of November 30, 2025. This direct control allows for standardized pricing and sales consultation, helping to manage customer expectations right from the start.

The physical touchpoints, the retail stores, are growing alongside sales volume. As of November 30, 2025, the company operated 544 retail stores across 157 cities in China. This physical presence supports the direct sales strategy and acts as a brand showcase for their family-focused vehicles.

Dedicated after-sales service through 556 service centers

For a premium vehicle owner, service availability is non-negotiable. Li Auto Inc. has heavily invested in its after-sales infrastructure to back up its sales. This network is designed to reduce user downtime, a critical factor for family buyers.

Here's a look at the network expansion supporting this commitment:

Metric	As of June 30, 2025	As of November 30, 2025
Servicing Centers	511 centers in 222 cities	556 servicing centers and authorized body and paint shops in 227 cities
Retail Stores	530 stores in 151 cities	544 stores in 157 cities
Super Charging Stations	2,851 stations with 15,655 stalls	3,614 stations with 20,027 stalls

The growth in servicing centers from 511 to 556 between Q2 and the end of Q4 2025 shows a clear capital allocation toward service density. Also, the charging infrastructure growth-from 15,655 stalls to 20,027 stalls over the same period-directly addresses range anxiety, which is a core customer relationship concern for any EV maker.

Community engagement and user feedback integration for product defintely improvement

Li Auto Inc. actively uses its user base to refine its product, which is a smart way to build loyalty. They concentrate in-house development on smart vehicle solutions, which feeds directly back into the user experience.

You see this integration in their software updates and product reception:

• The company planned to release software update OTA 8.1 in early December 2025, showing a commitment to continuous improvement post-sale.
• The new Li MEGA Home feature set received strong validation, accounting for over 90% of orders for Li MEGA models, indicating that user-centric innovations resonate.
• In Q2 2025, Li Auto Inc. captured a 13.4% market share in the RMB 200,000 and above NEV market in China, suggesting their product-market fit, informed by user needs, remains strong among Chinese auto brands.

They are leveraging their in-house developed VLA driver-assist large model to rapidly iterate on features, which is how you maintain a competitive edge in the software-defined vehicle space.

Digital and app-based interaction for service and connectivity

The relationship extends deep into the vehicle's digital ecosystem. The focus on smart vehicle solutions means the car itself is a primary channel for interaction, moving beyond just physical service centers.

This digital layer supports connectivity and service scheduling. While specific app usage statistics aren't always public, the strategy is clear: use technology to create value for users. The planned OTA 8.1 release is the most concrete example of this, delivering new functionality directly to the customer's garage. This digital relationship is what keeps the brand top-of-mind between service visits.

Finance: draft 13-week cash view by Friday.

Li Auto Inc. (LI) - Canvas Business Model: Channels

You're looking at how Li Auto Inc. gets its premium smart electric vehicles into the hands of customers and supports them afterward. This is all about their direct-to-consumer (D2C) approach, which is quite capital-intensive but gives them control over the entire customer journey, from initial interest to after-sales service.

The physical footprint is substantial and growing, which is key for a brand focused on family utility vehicles across China's vast geography. The expansion of the direct sales and service network is a core part of their strategy, especially as they push their new Battery Electric Vehicle (BEV) models alongside their established Extended-Range Electric Vehicles (EREVs).

Here's a look at the scale of their physical touchpoints as of late 2025, based on the latest available figures:

Channel Metric	As of November 30, 2025	As of May 31, 2025
Direct-to-customer Retail Stores	544	506
Chinese Cities with Retail Stores	157	152
Self-operated Supercharging Stations	3,614	2,414
Supercharging Stalls	20,027	13,195

The growth in supercharging infrastructure is defintely aggressive, aiming to alleviate range anxiety for both EREV and BEV users. The company had an ambitious goal to deploy over 5,000 supercharging stations by the end of 2025.

The direct sales model is supported by digital channels, which you'd expect for a modern automaker. This includes the official website and the mobile application. These platforms are critical for more than just browsing; they are used for:

• Placing vehicle orders and managing configurations.
• Booking service appointments at servicing centers.
• Receiving Over-The-Air (OTA) software updates, such as the planned OTA 8.1 release in early December 2025.

Li Auto Inc. also maintains a significant after-sales presence, which is tightly integrated with the sales channel. As of November 30, 2025, the company operated 556 servicing centers and Li Auto-authorized body and paint shops across 227 cities. This physical support network is essential for maintaining the premium customer experience.

For the physical movement of vehicles from manufacturing sites to the customer-facing retail stores, Li Auto Inc. relies on a combination of internal oversight and external support. The company's manufacturing approach includes the adoption of standardized quality control systems that ensure stable alignment between component suppliers, internal hardware teams, and external logistics partners for its delivery systems. While specific third-party logistics providers aren't named in the public filings, this structure confirms the use of specialized partners for vehicle distribution across China.

The channel effectiveness is tied directly to sales volume. For context on the demand flowing through these channels, Li Auto Inc. delivered 33,181 vehicles in November 2025. The company was projecting third-quarter 2025 deliveries to be between 90,000 and 95,000 vehicles.

Finance: draft 13-week cash view by Friday.

Li Auto Inc. (LI) - Canvas Business Model: Customer Segments

You're looking at the core buyers for Li Auto Inc. as of late 2025. The company has built its success by focusing intensely on a specific demographic, though recent product launches show a clear push to broaden that base.

The foundational customer segment for Li Auto Inc. remains affluent Chinese families prioritizing safety, space, and technology. These are consumers in China's B2C market who value the 'Mobile Home' concept in their vehicle.

This focus translates directly into market dominance in the premium price bracket. Li Auto Inc. has maintained its position as the sales champion for SUVs priced above RMB 200,000 for two consecutive years as of mid-2025. As of Q2 2025, the company held a 13.4% market share in China's RMB 200,000 and above NEV segment.

The company is actively expanding to younger family segments with models like the Li L6. This model, launched with a starting price of RMB 249,800, became a massive volume driver. Here's a look at how the L-series models, which cater to this family segment, performed in Q1 2025:

Model Segment	Approximate Price Range (RMB)	Q1 2025 Deliveries	% of Total Q1 2025 Deliveries
Li L6 (Five-seat mid-large SUV)	Starting at 249,800	44,347	Nearly 48%
Li L7 (Five-seat mid-large SUV)	300,000-400,000	20,983	N/A
Li L8 (Six-seat mid-large SUV)	300,000-400,000	12,940	N/A
Li L9 (Six-seat large flagship SUV)	400,000-500,000	12,191	N/A

The push into pure Battery Electric Vehicles (BEVs) targets early adopters of new BEV technology, specifically with the Li MEGA and Li i8. The Li MEGA, a high-tech flagship family MPV, has found success in the ultra-premium space. Since May 2025, the Li MEGA has been the best-selling MPV priced above RMB 500,000, regardless of power source.

The reception for the Li MEGA shows strong endorsement for its premium features, especially the high-end trim:

• Li MEGA Home trim accounted for over 90% of all Li MEGA model orders as of April 2025.
• Presales for the Li MEGA model neared 10,000 units.
• The price for the Li MEGA was reduced by RMB 30,000 to RMB 529,800 in March 2025 to boost competitiveness.

The Li i8, a five-seat BEV SUV, also targets this group, though its initial ramp was slower. The company adjusted its strategy for this model:

• The Li i8's price was cut to RMB 339,800 from RMB 349,800 in August 2025.
• Early order data for the Li i8 indicated only approximately 6,000 firm orders in its first week.

Overall, the 2025 sales target breakdown indicated a commitment to this BEV segment, forecasting 120,000 units for the pure electric lineup, which includes the Li MEGA.

Li Auto Inc. (LI) - Canvas Business Model: Cost Structure

You're looking at the expense side of the ledger for Li Auto Inc. as of late 2025, and the numbers show where the heavy lifting-and the heavy spending-is happening. It's a cost structure heavily weighted toward production and the massive technological pivot underway.

The Cost of Sales remains the single largest component of the cost base. For the second quarter of 2025, this figure totaled RMB 24.2 billion. That number is down 5.2% compared to the same period last year, which management attributed to cost reduction efforts and product mix changes, even as vehicle deliveries increased sequentially.

Research and Development expenses are clearly a major investment area, reflecting the transition to Battery Electric Vehicles (BEV) and the push into autonomous driving. In Q2 2025, R&D spend was RMB 2.8 billion, which was an 11.8% jump from the first quarter of 2025, driven by new vehicle programs and technology support. By the third quarter, R&D expenses had climbed further to RMB 3 billion, marking a 15% year-over-year increase. Honestly, the commitment here is clear: the full-year R&D spending is projected to hit RMB 12 billion, with AI investments alone expected to surpass RMB 6 billion for 2025.

Operating expenses capture the costs of running the business, including the physical footprint. Selling, General and Administrative (SG&A) expenses in Q2 2025 were RMB 2.7 billion, up 7.4% from the prior quarter, signaling expansion. This supports the growing physical presence required to sell and service these complex vehicles.

Here's a quick look at how the key cost components stacked up in Q2 2025:

Cost Metric	Q2 2025 Amount (RMB)	QoQ Change
Cost of Sales	24.2 billion	+17.3%
Research & Development Expenses	2.8 billion	+11.8%
SG&A Expenses	2.7 billion	+7.4%

The expansion of the retail and service network is a direct cost driver. As of June 30, 2025, the physical network looked like this:

• 530 retail stores across 151 cities.
• 511 servicing centers and authorized body/paint shops across 222 cities.

Capital expenditure is also tied to supporting the BEV push, specifically through charging infrastructure. Li Auto Inc. was actively building this out, aiming for a 4,000-station goal by the end of 2025, up from the 2,851 super charging stations and 15,655 charging stalls operational at the end of Q2 2025. The long-term target is around 4,800 stations by 2026.

Then you have the unexpected hits, like warranty and recall costs. The voluntary recall for the Li MEGA model, stemming from a battery safety risk, resulted in a significant financial provision. In Q3 2025, Li Auto set aside an estimated RMB 1.1 billion in warranty costs specifically for the MEGA recall. Furthermore, the total estimated liability booked related to the MEGA recall reached RMB 11 billion (or c. $1.55 billion). This charge severely impacted profitability, causing the Q3 2025 gross margin to drop to 16.3%; excluding the recall effect, the adjusted gross margin would have been 20.4%.

Finance: draft a sensitivity analysis on the impact of a similar-sized recall on Q4 2025 margins by next Tuesday.

Li Auto Inc. (LI) - Canvas Business Model: Revenue Streams

You're looking at how Li Auto Inc. actually brings in the money, which is always the most critical part of any business model review. Honestly, for Li Auto Inc., it's still overwhelmingly about moving metal, but the supporting services are growing, which is defintely something to watch.

The primary revenue stream comes directly from Vehicle Sales. For the second quarter of 2025, this segment clocked in at RMB 28.9 billion. That figure represents the bulk of their total revenue for the period, which was RMB 30.2 billion. You can see the vehicle margin was holding up reasonably well at 19.4% for the quarter, compared to 18.7% in the second quarter of 2024.

Next up is the revenue from Other Sales and Services. This was reported at RMB 1.4 billion in Q2 2025. This number is important because it shows the monetization of the installed base, even if it's a smaller piece of the pie compared to the cars themselves. The overall gross margin for the company in Q2 2025 settled at 20.1%.

Here's a quick look at how those top-line revenue components stacked up in Q2 2025:

Revenue Component	Q2 2025 Amount (RMB)	QoQ Change
Total Revenues	30.2 billion	+16.7%
Vehicle Sales	28.9 billion	+17.0%
Other Sales and Services	1.4 billion	+9.0%

The growth in that secondary revenue bucket is tied directly to the services and add-ons you mentioned. It's not just about the initial transaction; it's about keeping the customer engaged and monetizing the vehicle throughout its life. This includes things like accessories, extended warranties, and various service packages that customers opt into.

Also, don't forget the infrastructure play. Li Auto Inc. is building out its energy network, which is a key part of the value proposition for their Extended Range Electric Vehicles (EREVs). As of the end of Q2 2025, they were operating 2,851 supercharging stations, which included 15,655 charging stalls. While the search results didn't give a specific revenue figure for charging fees, this network expansion directly supports the potential for future revenue from fees at self-operated supercharging stations as more owners rely on that infrastructure.

The components driving the Other Sales and Services revenue stream include:

• Sales of accessories for the vehicles.
• Revenue from extended warranties purchased by owners.
• Fees collected for various service packages.
• Potential fees from charging services at their growing network.

Finance: draft 13-week cash view by Friday.