Li Auto Expands In-House Batteries as Nio, BYD Veteran and Rivals Shift Strategy

Li Auto has set a lock-order timeline for the new MEGA. Orders placed before 3 p.m. on Sept. 7 will receive CATL 5C ternary batteries; orders after that will enter delivery batches with Li Auto's self-developed 5C ternary battery, with deliveries expected to start in November. Three days earlier, on Sept. 4, Beijing Li Auto agreed to invest RMB 2.65 billion in Sunwoda Power. After the deal, Beijing Li Auto will directly hold 8.79% of Sunwoda Power. Together with a 2.60% stake held through an affiliate, Li Auto's related entities will hold about 11.17%, making it the second-largest shareholder. The pre-money valuation was RMB 27.4848 billion, in line with Sunwoda Power's previous Series C round. Li Auto said the investment is to deepen cooperation in technology development, production capacity and market expansion.

Li Auto's self-developed batteries are already used in the new L8, L6 and i8. In the fourth quarter, the new MEGA, the all-new i9 and the 2026 i6 will also move to the in-house battery. Ma said the company's battery strategy is a continuation of its dual-energy strategy announced at the 2023 Shanghai auto show, not a cost-cutting or supplier-switching move. The battery team has about 300 people, 75% with master's or doctoral degrees, with labs in Beijing, Shanghai and Suzhou and nearly 4,000 patent applications or grants. Ma said the 2025 MEGA battery recall reminded Li Auto of the importance of owning core data. He added that self-development and external procurement are not mutually exclusive, and CATL remains an important partner. Sunwoda has worked with Li Auto for nearly six years, helping turn its designs into mass production. Li Auto says the investment buys certainty in research, quality, capacity and delivery as its batteries become more non-standard.

Nio's William Li told employees on Sept. 8 that the Chinese auto industry has entered the most brutal stage of the final competition. In the first eight months of 2026, China's passenger vehicle retail sales fell 20.8% to 11.716 million units, according to the China Passenger Car Association. Nio delivered 262,893 vehicles in the same period, up 57.9%. Li said Nio's next three years will focus on its main business, the premium segment and core markets. He said Nio may participate in embodied intelligence mainly through strategic investments for a long time and will not make it a main business. Nio's service and community business generated more than RMB 10 billion in 2025, RMB 5.8 billion in the first half of 2026 and has been profitable for several consecutive quarters, enough to cover charging and battery-swapping infrastructure investment, according to Li.

In a separate media discussion, Li and Nio President Qin Lihong said rising memory and AI data center demand has created 'diseconomies of scale' for automakers. Nio's per-vehicle cost rose RMB 14,000 in the second quarter from the end of last year, adding about RMB 1.5 billion in costs for the quarter. Li expected further increases of RMB 2,000 to RMB 3,000 in the second half. Still, Nio reported first-half deliveries of 191,100 vehicles, up 67.4%; revenue of RMB 57.67 billion, up 85.8%; gross profit of RMB 10.77 billion, up 282.2%; and a comprehensive gross margin of 18.7%. Second-quarter operating profit was RMB 207 million, its third consecutive profitable quarter on a non-GAAP basis. Nio's average transaction price was RMB 406,000 in the second quarter and RMB 434,600 in July. Li said that was about RMB 180,000 more than Audi, RMB 70,000 to RMB 80,000 more than BMW and tens of thousands more than Mercedes-Benz.

Shu Youxing, former BYD Europe president, founded Xingneng Yuanxing Technology (Shenzhen) Co., Ltd. on Aug. 16, 2026, with registered capital of RMB 5 million, according to Lefeng. Shu is legal representative and holds 100%; Zhang Anruo is supervisor. The company is registered in Longgang District, Shenzhen, and listed under new energy technology promotion services. Shu stepped down as a director of BYD Toyota EV Technology in 2026, with BYD board secretary and investment general manager Li Qian taking the role. Shu worked at BYD for nearly 27 years, joining in 1999 after graduating from Tsinghua University in chemical engineering. He held roles in process, sales, optoelectronics and BYD Electronic, then became general manager of BYD Auto Sales in 2015. He later led BYD's smart ecology institute and moved to overseas work in 2022 as general manager of international cooperation and European auto sales. In 2023 he said BYD had entered 15 European countries and built more than 140 stores; at the 2024 Paris auto show he said BYD had entered more than 20 European countries and expanded from three to eight models. The new company's business direction has not been disclosed.

Leapmotor held a technology event on Sept. 16. Founder Zhu Jiangming said the company's second brand aims to make an 'iPhone-style' change to cars, with a cabin space efficiency target above 100%, a new architecture, and a launch and delivery planned for the fourth quarter of next year. Leapmotor also said its advanced driver assistance system has moved to a world-model route, with a year-end target of 100 kilometers without takeover in urban areas. Its technology supply business has expanded: vehicle-level technology has been provided to FAW and Stellantis; electronic products have five external partners, battery systems 10, and electric drive and power electronics have won designations from eight automakers. In August 2026, Leapmotor delivered 103,129 vehicles globally. First-half net profit attributable to shareholders was RMB 210 million.

IM Motors opened pre-sales for the new LS6 on Sept. 10 at a starting price of RMB 209,900, with 8,000 small orders in 45 minutes. The model will launch on Sept. 23. IM calls it the first RMB 200,000-class electric SUV under its Next 2028 strategy. It features a steer-by-wire chassis with triple redundancy, a 20-millisecond response, a 4.49-meter turning radius and three adjustable steering ratios. IM says energy consumption is 12.7 kWh/100 km, with a rear-drive large-battery version rated at 782 km CLTC. The car uses an 800V platform with peak charging power of 396 kW and 500 km of range added in 15 minutes. It also debuts the IM Claw cockpit agent and the IM AD ZETA driver assistance system developed with Momenta. IM has 436 stores in China and an average transaction price of RMB 230,000.

Luxeed executive Zhao Changjiang said the V9 MPV delivered 10,101 units in July, with an average transaction price of about RMB 500,000 and high-end versions accounting for more than 80%. The V9 is priced from RMB 389,800 to RMB 519,800. Zhao said Luxeed's strategy is to be 'more Huawei, more Luxeed and more innovative.' The RX SUV opened pre-sales on Aug. 20 at RMB 299,800 to RMB 399,800, with four lidar units, 38 fused perception sensors and an architecture designed for future L3 autonomous driving. Zhao compared the RX to Huawei's Pura X and said it is not simply an upgraded R7. Luxeed has built a dedicated smart factory in Wuhu with CMMM Level 4 certification, has more than 6,000 employees and nearly 90 dedicated stores, while continuing to use Huawei's terminal network.

Editor's Summary

Li Auto's plan to expand self-developed batteries and its RMB 2.65 billion investment in Sunwoda Power mark a deeper push to control battery technology and manufacturing certainty. Nio is focusing on premium models and core markets while managing rising costs and reporting improved margins, and former BYD executive Shu Youxing has started a new energy company. Leapmotor, IM Motors and Luxeed are also advancing new architectures, driver assistance, premium products and technology supply deals as competition in China's EV market intensifies.