Original: New Energy Outlook (ID: xinnengyuanqianzhan)

Total words: 2689, Reading time: 6 minutes

If 2023 belonged to Li Auto, then 2024 is undeniably Leapmotor's year to shine.

On December 1, Leapmotor was the first to release its November delivery figures, surpassing the 40,000-unit milestone with 40,169 vehicles delivered, making it the first new energy vehicle brand to achieve its annual sales target ahead of schedule.

The brand's pinnacle moment came during the "Leapmotor 9th Anniversary Celebration" on December 24, where its founder, chairman, and CEO, Zhu Jiangming, openly declared in a letter to all employees that 2024 had been a bountiful year for Leapmotor, signifying that it had "entered the finals."

Image/Leapmotor Popup

Source/Internet, New Energy Outlook screenshot

Eager to share the good news with its 600,000 "Leapresidents," some Leapmotor owners posted videos showcasing popup ads they received while driving, albeit these were promptly reported and removed due to their impact on the driving experience.

As Leapmotor's sales soared, the "Leapresident" community expanded, leading to dissatisfaction among long-term owners regarding issues like OTA discrimination, price reductions, feature downgrades, and battery power restrictions.

As Leapmotor enters the finals, it must ensure stability and long-term success.

1. How Did Monthly Sales Reach 40,000 Units?

Even though 2024 is not yet over, Leapmotor has been one of the most active players in the new energy vehicle sector, selling nearly 300,000 vehicles throughout the year.

Leapmotor's data reveals it has set monthly delivery records for six consecutive months.

From January to November, Leapmotor delivered a total of 251,207 vehicles, marking a 100% year-on-year increase and surpassing its annual sales target of 250,000 vehicles ahead of schedule.

Image/Leapmotor January-November Delivery Data

Source/Internet, New Energy Outlook screenshot

In 2024, China's new energy vehicle penetration rate surpassed 50% for five consecutive months starting in July. Despite the mature market, Leapmotor achieved a "comeback" and garnered significant praise.

Upon closer inspection, Leapmotor's success stems from its cost-effectiveness and extended-range capabilities, which are pivotal in attracting consumers.

Currently, Leapmotor's lineup includes three C-series SUV models (C16, C10, and C11), the C01 sedan, and the T03 mini-car.

Image/Leapmotor C16, C11, C01, T03

Source/Internet, New Energy Outlook screenshot

Among these five models, the C16, C10, and C11, priced between 150,000 and 200,000 yuan, lead in sales due to their spacious interiors, intelligence, and extended-range capabilities.

Mr. Zhang, a Leapmotor C10 owner, shared that in a large family with elderly parents and children, vehicle space is crucial. "I considered other models that met my space requirements, like Li Auto's L7, but it was pricey. Then I saw the Leapmotor C10, which offers the same spacious interior and extended-range capabilities. It was perfect."

Image/Leapmotor C10

Source/Internet, New Energy Outlook screenshot

Mr. Zhang also noted that while the C10's configuration isn't luxurious, it's adequate for a family car. "For instance, its intelligent driving assistance system alleviates driving fatigue, and the intelligent voice interaction meets my children's needs."

Many consumers share Mr. Zhang's sentiments, earning Leapmotor the title of "Li Auto alternative."

In response, Leapmotor's Senior Vice President Cao Li said, "There's nothing wrong with being a Li Auto alternative."

However, Cao Li also emphasized, "There are product positioning differences between us and Li Auto. Li Auto's main models in the same segment are priced above 350,000 yuan, while ours are below 200,000 yuan. It doesn't mean just because our price is lower, we accept inferior functions and performance."

In his view, Leapmotor's products must approach the performance and quality of superior products but differ in pricing philosophy. Being a Li Auto alternative is undoubtedly beneficial for Leapmotor.

2. Has Leapmotor Secured the Top Sales Spot for 2025?

Undoubtedly, 2024 was a fruitful year for Leapmotor.

Based on its stellar 2024 performance, Leapmotor has set an ambitious sales target of 500,000 vehicles for 2025.

However, relying solely on the three C-series models to double sales, even with attractive pricing, will be challenging. Leapmotor recognizes that "more children mean more fighting power," making the launch of new products a key strategy for 2025.

In fact, at the 2024 Paris Motor Show, Leapmotor unveiled the B10, the first model in its B-series. This compact SUV, based on the LEAP 3.5 architecture B platform, is expected to hit the market in 2025 with a price range of 100,000 to 150,000 yuan.

Image/Leapmotor B10

Source/Internet, New Energy Outlook screenshot

According to previous announcements by Leapmotor, in addition to the B10, two other B-series models will be launched in 2025: the B01 sedan and the B05 hatchback, scheduled for release in June and December 2025, respectively.

Apart from product diversification, accelerating internationalization is another strategy for Leapmotor to capture market share in 2025.

In an internal letter marking the company's ninth anniversary, Zhu Jiangming mentioned, "After visiting the European market in November, I sensed the huge market potential overseas. We must fully collaborate with the Stellantis Group to accelerate sales and service channel expansion in the global market and introduce new products, including the B-series."

Compared to other Chinese automakers, partnering with the Stellantis Group is one of Leapmotor's biggest advantages in going overseas. The Stellantis Group provides support for Leapmotor's entry into the international market and subsequent service guarantees, encompassing channel networks, after-sales service, automotive finance, logistics, and component empowerment.

Image/Leapmotor and Stellantis Group Strategic Cooperation

Source/Internet, New Energy Outlook screenshot

As of the end of October, Leapmotor had opened 339 dealerships in Europe and aims to establish 500 sales points by the end of 2025.

According to industry insiders, Leapmotor achieved impressive results in 2024 with nearly 300,000 vehicle sales and the launch of the LEAP 3.0 technology architecture.

"However, to achieve the 2025 sales target of 500,000 vehicles, expanding the product line alone may not suffice. To truly excel in the finals, Leapmotor must also strengthen its brand. Especially when leading automakers all have high-end models, Leapmotor's reliance on the word 'cost-effectiveness' may help sell cars but not necessarily ensure top-tier sales performance."

3. Clearing Obstacles on the Path to 'Leading the Race'

As mentioned by industry insiders, Leapmotor has indeed found the key to sales success, but 'cost-effectiveness' and 'making big money' are different paths, making Leapmotor, like many other new energy vehicle companies, confront the harsh reality of losses.

According to Leapmotor's third-quarter 2024 financial report, the company's revenue for the period was 9.86 billion yuan, a quarter-on-quarter increase of 83.9% and a year-on-year increase of 74.3%. Although Leapmotor's net loss in the third quarter was significantly narrower than the 990 million yuan net loss in the same period last year, it still reached 690 million yuan, failing to achieve profitability.

Image/Leapmotor Third-Quarter Financial Report Revenue Data

Source/Internet, New Energy Outlook screenshot

In 2024, Leapmotor accumulated losses of nearly 3 billion yuan. Striving for profitability is undoubtedly one of Leapmotor's primary goals for 2025.

However, as domestic competition in the new energy vehicle market intensifies, the survival landscape for participants in 2025 will only become more challenging.

Especially as "end-to-end" advanced intelligent driving becomes a focus for major automakers, leading companies like BYD are increasing their investment in intelligent technology research and development.

Some market forecasts even predict that with technological advancements and cost reductions, advanced intelligent driving features will gradually become available in vehicles priced at around 100,000 yuan in the coming years. In fact, some current models priced at around 100,000 yuan already come equipped with advanced intelligent driving capabilities.

This undoubtedly poses a threat to Leapmotor's sales.

Moreover, during Leapmotor's rapid growth, its product quality has been criticized by many owners.

A survey by a renowned automotive media outlet, "Hundreds of Car Owners Evaluate New Cars," revealed that while the 2024 Leapmotor C10 received wide praise for its design, spacious interior, and cost-effectiveness, some consumers complained about poor noise isolation and numerous issues with body accessories and electrical components.

Image/"Hundreds of Car Owners Evaluate New Cars" - Leapmotor C10

Source/Internet, New Energy Outlook screenshot

According to the survey results, of the 102 valid responses received, 39 indicated that the vehicle had experienced non-human-induced faults or quality issues, accounting for 38.2%. Among these vehicles with non-human-induced faults, the majority (66.7%) experienced their first fault within 500 kilometers of driving. Additionally, over 70% of owners reported that the vehicle developed faults within one month of purchase.

Other highly complained-about issues include Leapmotor's practice of limiting power output in winter, slow charging speeds at highway service areas (with some chargers only providing 40KW), and subpar performance of the battery, motor, and controller.

However, compared to the above issues, the more challenging obstacle for Leapmotor is the transition to high-end products. As consumer demands for automobile quality and brand value increase, Leapmotor must upgrade its brand image and product positioning to adapt to market changes. But completely shaking off the label of 'cost-effectiveness' will be extremely difficult, as evidenced by Xiaomi's development journey.

It seems that while Leapmotor has garnered significant market attention, it still has a long way to go before it can truly enjoy a comfortable existence.