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On May 15, Beijing Hao Junbo's WeChat public account "International Lawyer" issued a document saying that Li Auto has recently been sued by investors for securities fraud, and investors accused Li Auto and some executives of false statements and violated securities laws and regulations to cause investors to suffer, and investors applied to the court to order the defendant to compensate for the losses caused by the decline in stock prices caused by its illegal acts.
In the current class action lawsuit, investors allege that Li Auto made false and/or misleading statements and/or failed to disclose throughout the litigation period: Li Auto's public statements during the litigation period were materially false and misleading because it exaggerated the market's demand for vehicles and the effectiveness of its operating strategy when it launched its first all-electric MPV, the Li MEGA, and was likely to have a material negative impact on the company's financial condition.
Looking back on the beginning and end of the event, before the launch of the Li MEGA, Li Auto had high hopes for the Li MEGA and set an aggressive sales target for it, but the performance of the model after its launch on March 1 was far less than expected, and Li Auto made a deep reflection internally, and adjusted the delivery target for the first quarter and the annual sales target on March 21. At the same time, as Li MEGA fell short of expectations, Li Auto's stock price also declined.
Li Auto released an extremely bright annual financial report on February 29. According to the financial report, in 2023, Li Auto will achieve an annual operating income of 123.85 billion yuan, a year-on-year increase of 173.5%, becoming the first new force in China with an annual revenue of more than 100 billion yuan, and at the same time achieving annual profitability for the first time, with a net profit of 11.81 billion yuan. At the 2023 annual results meeting, Chairman Li Xiang said that 2024 will be an unprecedented year for ideal products, proudly challenging the annual sales target of 800,000 units delivered in 2024, and at the same time warming up the blockbuster new car Ideal MEGA. Affected by the good news, Li Auto's stock price currently closes at $45.88.
On March 1, the ideal MEGA made its debut and announced that its price was 559,800 yuan, and deliveries will start on March 11. At the press conference, Li Xiang, CEO of Li Auto, said that MEGA will be the next explosive product of Li Auto, and he is confident that it will become the first in sales of more than 500,000 people. However, Li Auto has not announced the ideal MEGA order for a long time, which is in stark contrast to Li Xiang's bold words at the press conference, market speculation may be far less than market expectations, and Li Auto's stock price has also entered a downward trend from this time. Since February 29, Li Auto's stock price has fallen by 44.38%, the latest stock price is $25.19, and the total market value is $26.727 billion, which is close to halving compared with the highest price of $46.44 this year, which is also the main reason why Li Auto is mired in litigation.
Regarding Li Auto's class action lawsuit by investors in the United States, Li Auto said that the class action lawsuit is true, but the accusations are groundless, and it will do its best to protect the rights and interests of the company and shareholders. According to relevant sources, this type of litigation is a common situation in the United States, and usually when the stock price of a listed company falls, the law firm will organize investors to collectively initiate such a lawsuit to claim compensation from the company.
It is worth mentioning that the troubles of Li Auto do not stop there. According to the exclusive report of "21st Century Business Herald", Li Auto launched a new round of employee optimization plan after the "May Day" holiday, and the total optimization ratio is expected to exceed 18%. According to the 2023 financial report, Li Auto has a total of nearly 31,600 employees, which means that more than 5,600 employees may be involved in this optimization. According to the report, the recruitment department, sales service operation department and intelligent driving department and other departments are the "hardest hit areas" of the employee optimization, and the optimized employees will implement the N+1 compensation policy, and Li Auto hopes to complete most of the personnel optimization plan before the lifting of the ban on employee stocks on June 15 to reduce the cost of stock cash. The report also pointed out that Li Auto has significantly reduced the proportion of employees recruited by the society and increased the proportion of employees recruited on campus. As of press time, Li Auto has not publicly responded to relevant reports.
In 2023, Li Auto will exceed its annual sales target with an annual sales volume of 376,000 units and a year-on-year growth rate of 182.2%, far ahead of all new cars. However, after entering 2024, Li Auto has been overtaken by AITO many times, and the sales pressure is unprecedented, especially after the release of MEGA, Li Auto's stock price has fallen sharply, and at the same time announced a downward revision of sales expectations. It is understood that the ideal car will be the previous delivery target of 800,000 units, adjusted to 56-640,000 units, but from January to April, a total of 106,200 units were delivered, and only 18.96% of the 560,000 units were calculated, and the next ideal car needs to be delivered more than 56,000 units per month, which is under huge pressure.
In fact, the current situation of Li Auto is not bad, its cash reserves at the end of 2023 are as high as more than 100 billion yuan, and the layoffs are more to solve the risk in advance, and prepare for the next potentially more brutal market competition.
Article source: National Business Daily, thank you