Leapmotor fired a shot at XPeng MONA

Author | Chai Xuchen

Editor | Zhou Zhiyu

After successfully breaking into the family SUV market with the label of "half-price ideal," Leapmotor is now targeting the 100,000-level smart car market where XPeng MONA operates.

On July 24, Leapmotor's first sedan in the B series, the B01, officially debuted, with a starting price directly breaking through the 100,000 yuan mark, coming in at 89,800 yuan, while the laser radar version starts at only 113,800 yuan. Industry insiders believe that this new sedan is likely to push Leapmotor's monthly delivery volume to a new high of 50,000 units.

The entry of the B01 comes at a timely moment, as Leapmotor sees opportunities in the 100,000-level car market, which reflects the subtle changes in the consumption structure of the current automotive market.

Currently, with changes in the economic environment, car consumption has become more pragmatic. Data from the National Information Center shows that sales of vehicles priced above 300,000 yuan have experienced negative growth in the past two years; meanwhile, sales of vehicles priced below 100,000 yuan have increased by 51% in the first five months of this year. Radar Securities believes that sales of vehicles below 100,000 yuan are expected to exceed 6 million units this year, accounting for more than 25% of total passenger car sales.

As a result, various car manufacturers with unique skills are competing for this market. In addition to the smart driving-focused XPeng MONA, BYD's Seal 06DM-i travel version has recently brought new energy travel cars down to the 100,000 yuan level; the upcoming Galaxy A7 is also likely to have a starting price below 100,000 yuan.

The first trump card for the B01 entering the 100,000-level market is its targeting of the current young consumers' "I want it all" mentality.

Insiders at Leapmotor indicate that the B01 is positioned in the blue ocean market of 100,000-level new energy sedans within the red sea of competition. In the past, the sedan market in this price range was largely occupied by ride-hailing vehicles that emphasize cost-effectiveness, traditional family hybrids, and hatchbacks that sacrifice space experience.

In the past, the new energy sedan market was refreshed by the Model 3, which changed people's perceptions of smart electric sedans, bringing smart cockpits, assisted driving, and overall vehicle intelligence into the public eye, but that kind of experience was often only available in vehicles priced at 200,000 to 300,000 yuan.

Therefore, the A-class sedan market needs a mainstream sedan. The XPeng MONA M03, launched last year, capitalized on this trend and quickly became a lifeline for XPeng, maintaining monthly sales above 10,000 units.

This time, Leapmotor plans to use the title of "half-price Model 3" to meet users' demands for range, driving control, intelligence, spaciousness, aesthetic appeal, and comprehensive safety, aiming to capture the 100,000-level family sedan market.

First and foremost, the B01 focuses on design, a label that Leapmotor has never established before. The B01 features a side curve without any angles, creating a visual center that runs through the entire vehicle; it also draws inspiration from IKEA's pegboard for a minimalist interior design; on the exterior, Leapmotor even collaborated with the renowned color research institution Pantone to develop a new car body color called Morgan Pink On the other hand, the existing shortcomings in intelligence for vehicles priced below 100,000 yuan have become a breakthrough point for the B01. According to data from the Yiche Research Institute, the penetration rate of intelligent cockpits in vehicles priced below 100,000 yuan is only 51%, significantly lower than the overall passenger car market rate of 76%; in terms of intelligent driving-related active safety, the penetration rate of AEB functions in the market below 100,000 yuan is only 10.7%.

The B01 is packed with features, using Qualcomm's SA8295P flagship cockpit chip and dual AI voice large models, combined with the Leapmotor OS 4.0 Plus interactive system, supporting multimodal recognition and AI voice assistants; in terms of intelligent driving, it is equipped with lidar and Qualcomm's 8650 chip, directly bringing high-level intelligent driving into the 100,000 yuan market.

In addition, Leapmotor has put considerable effort into driving control, and its collaboration with Stellantis has given Leapmotor vehicles a competitive advantage in chassis tuning. The B01's chassis features a front MacPherson and rear multi-link suspension structure, jointly tuned by teams from China and Europe.

According to Leapmotor, the B01 boasts "Italian-style precise steering, French car-like agile chassis, and American luxury shock absorption performance." This means the B01 aims to attract young users who pursue a sense of speed.

The B01 has initially locked in its blockbuster attributes. It is worth noting that the monthly sales of XPeng's MONA M03 are around 14,000 units, and BYD's Qin L EV also sees monthly sales of about 10,000 units, indicating that the B01 has the strength to compete with them.

It can be said that the B01 is full of sincerity, but there are concerns in the industry about whether such aggressive pricing will affect Leapmotor's profits.

Currently, as competition becomes fierce, automakers must continuously enhance product strength and cost-effectiveness to secure a place in the market below 100,000 yuan. It is not easy to gain a share in such a down-market; some sales personnel have admitted, "For vehicles priced below 100,000 yuan, automakers have little profit left."

This is precisely the advantage of Leapmotor's comprehensive in-house research and development. Leapmotor's Senior Vice President, Cao Li, stated, "We have fully considered the situation of our competitors, and our integrated advantages from comprehensive in-house R&D are absolutely the most competitive in the same market segment." Chairman Zhu Jiangming bluntly stated, "Leapmotor not only aims to avoid losses but also to steadily increase gross margins."

This means that only large manufacturers with complete systematic capabilities have the opportunity to mine gold in this market and ultimately secure a place.

Clearly, Leapmotor, the dark horse of the industry, is still galloping forward, but its ambitions go beyond this.

"We must ensure the achievement of 500,000 sales this year. This is a small goal; in the future, we aim to become a world-class electric vehicle company, with 4 million as our big goal." Zhu Jiangming stated, "The target of 1 million is a must; it is the survival bottom line; otherwise, it will be very difficult to survive. If it is 500,000 or 600,000, we are still on the edge of struggling."

It is important to note that an annual sales volume of 4 million can already stand shoulder to shoulder with giants like BYD and General Motors. How will Leapmotor achieve this FLAG? Zhu Jiangming's solution is to make each model an industry evergreen, maintaining a hot sales momentum. On the other hand, Leapmotor's A, B, C, and D series will be fully launched next year, perhaps a true industry disruptor is quietly emerging The following is a transcript of the conversation with Leapmotor Chairman and CEO Zhu Jiangming, Senior Vice President Cao Li, and Vice President Zhou Ying:

Q: What is the core of the B01 disrupting the 100,000-level sedan market?

Cao Li: Sedans are actually very difficult to make, especially new energy sedans. If not done well, they might just become ride-hailing cars. If done well, the price and cost are hard to control. Sedans priced just over 100,000 are a real test for car manufacturers. The biggest highlight of the B01 is that it has no shortcomings. This is the first time we directly mentioned the handling characteristics at a press conference. The B01 can exceed everyone's expectations for new energy sedans priced at 100,000 in four aspects.

Zhu Jiangming: I have been driving the B01 for over a month, and its level of refinement can compete with joint venture cars. Now that fuel vehicles are selling less and less, sedans are still selling quite well. The Camry is the most classic sedan, and the B01 has much more space than the Corolla, so I consider it an A+ car in length, but the internal space completely reaches the B-class level.

Q: What are the internal sales expectations for the B01?

Zhu Jiangming: Of course, the sales expectation is the more, the better, but Leapmotor's product characteristic is that it is slow to heat up. When the C10 was launched last year, the first month saw 4,000 units sold, starting from March, but by the end of the year, it gradually increased to 5,000-7,000 through word of mouth. Every model from Leapmotor follows the same rhythm; it is a slow-heating product, but it will sell better and better. Our B10 will also follow this path.

Q: In the A-class market, Leapmotor is a game changer, but will it flow into the ride-hailing market in the future?

Zhu Jiangming: Leapmotor will definitely not enter the ride-hailing market. We still hope to create mainstream products for families because our products are more suitable for families.

Q: How does Leapmotor respond to the pressure of competitors cutting prices?

Cao Li: We have fully considered the situation of our competitors. The pricing principle of the B01 is not just based on what others have set; it is also influenced by costs. Our fully self-developed integrated advantages are absolutely the most competitive in the same market segment. I believe Leapmotor has super strong competitiveness without losing money.

Zhu Jiangming: Leapmotor not only aims to avoid losses but also to steadily increase its gross profit margin.

Q: What are Leapmotor's goals for the next stage, especially in terms of globalization and high-end development?

Zhu Jiangming: We are currently ensuring the achievement of 500,000 units in sales this year. This is a small goal. We still strive to become a world-class electric vehicle company, with a target of reaching 4 million units, which is our big goal.

Leapmotor's style is to be pragmatic and take one step at a time. Today marks the launch of the second new car in the B series, the B01, and we will introduce the third new car at the Munich Auto Show this year. Next year, we will launch five to six models, which will be a big year for Leapmotor's products, including the A series and the flagship D series. There may be some unexpected cutting-edge technologies that represent the future development direction of the industry. This is the future direction of Leapmotor Q: Previously, Leapmotor mentioned achieving a major breakthrough within three years. Can you share specific plans? What is currently the biggest obstacle to achieving this goal?

Zhu Jiangming: First of all, I believe that the target of 1 million is a must; it is the survival bottom line, otherwise, it will be very difficult to survive. If it’s around 500,000 to 600,000, we are still on the edge of struggling.

We hope that every model of Leapmotor can achieve sales. Last year we launched the C10 and C16, and this year we made some modifications to maintain those sales. The C10 has already surpassed 14,000 to 15,000, which fully demonstrates that every product of Leapmotor will continue to sell well, maintaining each model like a Camry or Corolla, which are evergreen products.

We hope that every car can become a classic. Based on this, we will complete the entire series, including models under 100,000, as well as the D series, which represents the most luxurious products in the Leapmotor series. We have completed the entire series, and each series must replicate success; then Leapmotor will definitely achieve its ultimate goal.

We will first push the C series, then the B, followed by the D and A series. Sales will range from 120,000 to 180,000, which accounts for the largest share of car sales in China. The B series will be priced between 100,000 and 130,000, which is the second largest in sales, followed by luxury cars and compact cars. Therefore, we are also moving from the largest sales to the smallest.

Choosing the price range of 150,000 is relatively easier than luxury cars, while also representing a certain brand and technical capability. If we started with the A series, it would be more difficult to move up one by one. Therefore, choosing the C series is also a very important factor for Leapmotor's success.

Q: What are Leapmotor's plans for external expansion?

Zhu Jiangming: In the first half of the year, Leapmotor's overall export growth was very significant, and we hope to achieve the annual target of over 50,000 in export sales. Last year, we completed over 13,000. We look forward to next year, as local manufacturing takes root, the overall increase in Leapmotor's overseas markets, especially in Europe, will be very noticeable.

Q: Leapmotor was previously referred to as "half-price Li Auto." Will you develop more expensive cars targeting the 300,000 to 500,000 price range in the future?

Zhu Jiangming: The B01 is referred to as the half-price Model 3; they are priced over 230,000, while we are around 120,000. Regarding whether electric vehicles can be sold for 400,000, 500,000, or 600,000, I think it’s very difficult. Currently, everyone is moving down the price ladder, which is a major trend because this is an electronic product.

Q: How does Leapmotor view the future development prospects of range-extended and electric vehicles?

Zhu Jiangming: My view is that range extenders will become less and less common, with a focus on pure electric vehicles. Range extenders are like power banks; they are suitable for relatively high-end products priced above 150,000. It is very difficult to operate in the market below 150,000 due to the challenging cost structure.

At the same time, the cost of battery cells is now low enough, reaching the level of 0.3 yuan per watt-hour for pure electric. As charging facilities become more complete and 800-volt high voltage becomes more widespread, charging will become faster, and these trends will determine that the proportion of pure electric vehicles will continue to increase