XPeng, NIO Accelerate Pursuit as Li Auto Reports First-Ever Sales Decline in 2025 Annual Results

With XPeng’s release of its financial results on March 20, the 2025 performance figures for China’s “NIO-XPeng-Li Auto” trio have all been revealed. XPeng delivered 429,000 vehicles in 2025, a 125.9% year-over-year increase, and reported its first-ever quarterly profit in Q4, with gross margin rising to 18.9%. NIO delivered 326,000 vehicles, up 46.9% year-over-year, and turned profitable in Q4 with a net income of RMB 2.83 billion. Li Auto delivered 406,300 vehicles, an 18.8% year-over-year decline—its first-ever annual drop—and although it posted a full-year net profit of RMB 1.14 billion, this represented an 85.8% plunge compared to the prior year, with earnings largely driven by investment income. Competition among the three has shifted from a “battle for survival” to one centered on profitability quality and technological positioning. XPeng achieved cost reductions through technology-driven models like the MONA M03; NIO enhanced economies of scale via multi-brand synergy and its battery-swap network; while Li Auto faced pressure due to the MEGA recall, market shifts toward BEVs, and growing pains from its strategic transition. In 2026, all three will confront even greater challenges from tech-backed newcomers such as Huawei and Xiaomi.