Chinese electric vehicle producer Li Auto is reportedly undergoing staff reductions in the wake of a substantial recall of its Mega multi-purpose vehicle. This news emerges just days before the company is scheduled to announce its third-quarter financial performance, highlighting a challenging period marked by operational setbacks and strategic business developments.
According to internal communications cited by the Chinese media outlet 21jingi on Friday, Li Auto has implemented accountability measures affecting 14 employees, with several individuals being terminated. This restructuring follows a recent incident where a Li Mega vehicle caught fire due to sparks originating from its chassis, leading to a recall of over 11,411 units of the MPV model due to coolant leakage issues.
Amidst these internal changes, Li Auto is gearing up to disclose its Q3 earnings on November 26, followed by a conference call with investors and analysts. The company also recently unveiled an exclusive collaboration with Hesai Technology, designating Hesai as the sole provider of LiDAR technology for all upcoming Li Auto models, including the 'L' Series, 'i' Series, and 'MEGA' line. This partnership underscores Li Auto's commitment to advancing its driver assistance and autonomous driving capabilities.
Furthermore, Li Auto reported robust October delivery figures, with over 31,767 vehicles delivered. The company expanded its global footprint by commencing operations in Uzbekistan in October, following the establishment of its overseas headquarters in Hong Kong. Despite these market and strategic advancements, the recent recall and subsequent layoffs indicate a period of intense scrutiny and operational adjustments for the EV maker.
The company, which shows strong performance in value metrics and satisfactory growth, is navigating a complex landscape of product quality control, market expansion, and financial reporting. The forthcoming earnings call will likely provide further details on the financial impact of the recall and the company's strategies for future growth and product reliability.