Li Auto, a leading Chinese EV manufacturer, has announced a significant internal reorganization aimed at bolstering its smart car capabilities and enhancing operational efficiency. The company is merging its sales and service group with its R&D and supply chain teams to establish a new smart car group.

Donghui Ma, Li Auto’s president, will spearhead this newly formed group, reporting directly to Xiang Li, the chairman and CEO. The smart car group will take charge of the entire strategic and operational closed loop for Li Auto’s smart vehicle business. This strategic integration is expected to foster deeper collaboration across the various functions of R&D, supply, sales, and service.

The company believes this will strengthen its ability to create and deliver user value, ultimately fortifying its competitive position in the rapidly evolving EV market. Li Auto is set to launch two new pure electric SUV models, the i8 and i6, in July and September 2025, respectively.

In a related move, Liangjun Zou, who previously served as the senior vice president and head of the sales and service group, will transition to a consulting role within the company.

Earlier this year, Li Auto had implemented a “battle zone” strategy within its sales division, streamlining 26 sales regions into five major zones. While this initiative aimed to decentralize accountability, enabling regional leaders to manage sales and profit independently, it reportedly led to some unauthorized sales practices.

Consequently, Li Auto has reaffirmed its commitment to maintaining uniform pricing and service standards to ensure fair practices and address internal employee dissatisfaction.

The restructuring underscores Li Auto’s proactive approach to adapt to the intense domestic automotive market competition and streamline its operations for sustained growth.

🔗 Source: Late Post

🧠 Food for thought

1️⃣ Strategic restructuring amid ambitious yet challenging sales targets

Li Auto’s organizational changes come at a critical juncture in the company’s growth trajectory, balancing ambitious goals with market realities.

The company has set a target of 700,000 vehicle sales for 2025, which represents a 40% increase from the 500,508 vehicles delivered in 2024 1.

However, Li Auto recently revised its Q2 2025 delivery forecast downward from 123,000-128,000 units to 108,000 units, indicating increasing competitive pressures in the Chinese EV market 2.

The new “smart vehicle group” structure appears designed to enhance efficiency as the company prepares to launch two significant pure electric SUV models, the i8 and i6, in July and September respectively, which are crucial to meeting annual targets.

This restructuring, with direct presidential oversight, suggests a strategic effort to eliminate departmental silos that could impede the company’s ability to execute quickly in a competitive landscape.

2️⃣ Balancing premium positioning with sales system evolution

Recent Li Auto developments