As we all know, since its inception, Lixiang has focused on the extended-range electric vehicle (EREV) model. From the Lixiang ONE to the Lixiang L9, L8, and L7, they are all EREV SUVs.

At the same time, Li Xiang, as a former automobile media professional, has a keen understanding of family users' needs and mindsets. Fridges, TVs, and large sofas are standard features, making Lixiang's entire lineup of vehicles extremely popular and inspiring imitation and follow-up by many other automakers.

Regarding EREVs, those who understand cars often criticize them, while those who buy them praise them.

However, despite their popularity, EREVs are still considered transitional technology. The ultimate goal of electrification is to move towards all-electric vehicles. Lixiang, of course, is aware of this fact, which is why they introduced the MEGA, an all-electric MPV, this year.

Lixiang has high hopes for the MEGA, expecting it to become as popular as models like the L9 and L8.

However, upon its release, the MEGA sparked significant controversy and had a significant impact on Lixiang, to the point that it could be said to have set the company back.

Prior to the MEGA's release, Lixiang was soaring in the capital market due to its strong performance in 2023, with a market value of up to $48 billion.

However, after the MEGA's release, Lixiang's market value plummeted, dropping by around 14% overnight, equivalent to a loss of approximately $50 billion.

This was just the beginning. Since the MEGA's release, Lixiang's market value has continued to decline, reaching only around $20 billion today, representing a 60% drop and a loss of approximately $28 billion, equivalent to RMB 200 billion.

Many may argue that the MEGA cannot be solely blamed for this decline, as subsequent performance-related issues also played a role.

While this may be true, the subsequent developments are still closely related to the MEGA.

In response to the MEGA's setback, Lixiang quickly introduced the L6, which has proven to be a popular model.

Before the L6's launch, Lixiang's sales were primarily driven by the L7 and L9. However, after the L6's release, it became the primary sales contributor. In June, for example, Lixiang delivered 48,000 new vehicles, with the L6 accounting for nearly half of those sales.

However, compared to the L7, L8, and L9, the L6 is significantly cheaper, making it less profitable. Additionally, the L6 faces stiff competition in its price range of RMB 250,000 to 300,000, where automakers are highly competitive.

Despite achieving profitability in both the first and second quarters, Lixiang's sales were not particularly lucrative. In fact, the company incurred an operating loss of RMB 117 million in the first half of the year.

Lixiang's profitability was primarily driven by its significant financial reserves, including over RMB 90 billion in cash. This allowed the company to generate over RMB 1.4 billion in interest income and investment gains, ultimately resulting in an overall profit of nearly RMB 1.69 billion, though this represented a 47.8% year-over-year decline.

It is clear that the MEGA has had a significant impact on Lixiang, and the company is still recovering from it.

Of course, all-electric vehicles are not particularly popular at present, but Lixiang cannot afford to abandon this segment as it represents the future. While EREVs are the current focus, Lixiang cannot sacrifice the future for the present. Therefore, the company plans to make another push into the all-electric market next year.