In China’s brutally competitive electric vehicle market, the latest major battle is playing out between NIO and its frenemy Li Auto, with the launches last week of their new all-electric, three-row sports utility vehicles, both targeting China’s well-off parents of multiple children families.
The relationship between the two US-listed EV makers has turned from bad to worse as a public spat erupted recently between senior executives of the companies, while their sales employees raised concerns over shortcomings in their competitors’ offerings, according to a TechNode reporter’s observations.
So far, it looks as if NIO is gaining the upper hand, as the company’s shares surged 8% on the New York Stock Exchange on July 31 following the launch of its Onvo L90, lifting its market capitalization to $4.9 billion. Shares in Li Auto meanwhile fell for the third consecutive day after its i8 SUV went on sale at a reportedly higher than expected price tag on July 29.
Why it matters: As China’s EV competition reaches the knockout stage, there is little room for mistakes for either NIO or Li Auto. The previous launches for both NIO’s first Onvo-branded model as well as Li Auto’s first all-electric car were marked by production delays and controversial designs, respectively.
- NIO’s accumulated losses since last year stood at more than $29 billion as of March. The success of the Onvo L90 would be a lifeline for the loss-making EV maker, which has announced a break-even goal for the final quarter of this year.
- Meanwhile, the lackluster performance of the Mega was already a setback for Li Auto, which had postponed the roll-out of the i8, its first battery electric SUV, for a year. The company is also facing slowing demand for its extended range hybrid SUVs.
READ MORE: Charts: NIO, Xpeng, and Li Auto report first quarter 2025 earnings
Details: Some industry figures said the overlap between the Onvo L90 and the Li i8 is limited, with one more budget-friendly than the other more luxurious car. However, others that TechNode spoke with believe the larger, more affordable Onvo L90 featuring NIO’s battery leasing option could make the Li i8 less attractive from a value proposition standpoint.
- The six-seat, single-motor Onvo L90 has a driving range of 605 kilometers (376 miles), with a starting price of only RMB 179,800 ($24,938) if customers pay a monthly rental fee for the Battery-as-a-Service (BaaS) program. It is priced from RMB 265,800 with ownership of the battery pack. The entry-level Li i8 offers a range of 670 km at a much higher price of RMB 321,800.
- The 5.2-meter-long L90, larger but lighter than the Li i8, has a roomier interior, as well as frunk and trunk spaces big enough for nine cases and one piece of kid’s luggage when all three rows of seating are in use for six people. By comparison, i8 owners can fit two 28-inch pieces of luggage and four bags in the rear, according to Li Auto chief executive Li Xiang. The i8 has no front storage space.
- However, a Li Auto salesperson suggested to TechNode on July 25 that the Onvo L90 gave customers cheap-looking interiors while the i8’s cabin featured more upscale materials. A NIO salesperson meanwhile briefed TechNode that the bullet-style front of Li Auto’s i8 could increase the likelihood of the car getting stuck under a truck in the event of a crash.
- The i8 has introduced some modern design elements, such as a front that resembles the look of China’s bullet trains, supposedly for better aerodynamics. Li Auto responded to the concerns raised around the design’s safety by presenting several crash test videos at its launch event, including a wild one in which the i8 collided with a truck of eight tons at a speed of 60 kilometers per hour (37 mph).
- The rare public spat between NIO and Li Auto escalated on July 24, when Li Auto‘s vice president Liu Jie implied NIO used a “water army,” meaning a group of paid internet trolls in China, to create and spread biased comments and rumors about the i8 on prominent platforms. Shen Fei, president of NIO’s Onvo brand, denied the claim with a demand for a public apology from Liu on Chinese micro-blogging platform Weibo.
READ MORE: NIO starts pre-sale of three-row Onvo L90 SUV at game-changing $27,000 price
Context: Automakers in China have been facing slowing demand, especially in the premium price segment, partly due to economic uncertainty fueled by tariffs.
- Sales of new energy vehicles (NEV) priced between RMB 300,000 and RMB 400,000, including all-electrics and plug-in hybrids, declined by more than 14% year-on-year in the first half of this year, according to figures published by the China Association of Automobile Manufacturers. Overall NEV sales rose 40.3% to nearly 7 million units over the same period, generated mainly from vehicles priced below RMB 150,000, the industry group said.
