Li Auto Inc.

for Lee Otto's first quarter 2024 earnings conference call. At this time, all participants are in listen-only mode. Today's conference call is being recorded. I will now turn the call over to your host, Ms. Janet Vang, Investor Relations Director of Lee Otto. Please go ahead, Janet.

Thank you, Kim. Good evening and good morning, everyone. Welcome to Lee Otto's first quarter 2024 earnings conference call. The company's financial and operating results were published in a press release earlier today, and they were posted on the company's IR website. On today's call, we will have our Chairman and CEO, Mr. Xiang Li, and our CFO, Mr. Johnny Tia Li, to begin with prepare remarks. Our President, Mr. Donghui Ma, and our Senior Vice President, Mr. James, Liang Junzhou, will join for the Q&A discussion. Before I continue, please be reminded that today's discussion will contain forward-looking statements made under the safe harbor provisions of the U.S. Private Securities Litigation Reform Act of 1995. Forward-looking statements involve inherent risks and uncertainties. As such, the company's actual results may be materially different from the views expressed today. Further information regarding risks and uncertainties is included in certain company failings with the U.S. Securities and Exchange Commission and the Stock Exchange of Hong Kong Limited. The company does not assume any obligation to update any forward-looking statements except as required in the applicable law. Please also note that Li Auto's earnings press release and this conference call include discussions of unaudited GAAP financial information as well as unaudited non-GAAP financial matters. Please refer to Liado's disclosure documents on the IR section of our website, which contain a reconciliation of the unaudited non-GAAP measures to comparable GAAP measures. Our CEO will start his remarks in Chinese. There will be English translation after he finishes all his remarks. With that, I will now turn the call over to our CEO, Mr. Xiangli. Please go ahead.

Hello, everyone. I'm Li Xiang. Welcome to today's phone call meeting. First of all, let me review the performance of Li Xiang's car in the first quarter. In the first quarter, we delivered 80,400 new cars, with a 52.9% growth rate. At the same time, according to the mid-term business statistics, more than 200,000 new cars in China have a 24.8% growth rate. The growth rate of Li Xiang's car is higher than that of others. It is in the leading position among the high-end new car brands. With the increase in the delivery amount, the total income in the first quarter of 2024 reached RMB256 billion, which is 36.4% of the total increase. Despite the experience of the launch of the ideal mega, the replacement of the ideal R series products, and the adjustment of the price system, our net profit is still maintained at 20.6% in health. In the long term, the ideal car has nearly 100 billion RMB in cash reserves, and the health asset debt table will continue to support us to focus on the value of our users and firmly invest in R&D. Through product and service, we will continue to bring the user experience that exceeds expectations for family users. However, I must admit that since this year, we have faced many challenges in terms of internal management and external environment changes. The performance of the first quarter is different from what we expected in the beginning of the year. In the face of problems, we are actively adjusting. We are actively and quickly making adjustments, starting and landing organizational upgrades, and process optimization, improve internal business efficiency and decision-making quality, and strive to better focus on the creation and delivery of user value. In terms of product, on March 1st, we released the first high-pressure long-distance vehicle, which was created for large families, the family technology flagship MPV, the Ideal Mega. Based on the 800V high-pressure platform, the Ideal Mega with 705V battery is one of the most fast-charging mass-produced SUVs at present. During May 1st, The average charging time of the ideal mega user in the ideal super station is only 12.8 minutes, which greatly relieves the incapability of the charging user. On April 18th, the new ideal R6, a family of five luxury SUVs, was officially launched and met the needs of more young families of less than 300,000. The ideal R6 has excellent internal space and functional configuration. The CRTC range reached 1,390 kilometers. In terms of safety, The car safety of the ideal 26 is the highest standard in the industry, and it is standard for the all-seater AEB, which is constantly being designed to provide safety insurance for all families. With the official launch of the ideal bag and the ideal 26, and the exchange rate upgrade of the 2024 ideal R7, R8, and R9, the ideal car provides a product balance between 200,000 and 600,000 yuan for a large family. In the next four years, we will also change the competition pattern according to the market, quickly reduce the demand of users, and introduce a new price system. Our adjustment has also received the warm response from users. The supply and demand quickly increased. During the May 1st period, the increase in weekly orders reached a historical high. Among them, Li Xian 26 received 410,000 orders in the first half of April 18 to May 5 after the release. We are doing our best to make Li Xian 26 and ensure the speed of delivery. With the release of the model, the smart platform is also waiting. In mid-May, we launched the full delivery of the AD PRO 3.0, and upgraded the AD PRO to the B1V visual large model structure, and implemented the high-speed 1-way with a 1000-kilometer speed limit, the recognizable red light, and the city LCC at the intersection, and the smart train that can handle the complex parking space. On the ideal ADMAX 3.0 model, the road-free urban OLA is also starting a 1,000-person user guide in May. It is expected to be upgraded to all ADMAX models through OTAs in the third quarter of this year. In terms of charging network, on May 19, the ideal car has opened and scheduled 404 ideal superchargers with 1,770 superchargers. During the five-day period, the ideal supercharge station provides the ideal car all-wheel drive owners with more than 50,000 free charging services, and provides 90,000 charging services to young car owners across the country. We will continue to strengthen, increase, and accelerate the investment in the supercharge network. The goal is to open more than 10,000 superchargers at high speeds and cities across the country at the end of this year, and continue to enhance the experience of supercharging energy for ideal pure electricity users. In terms of sales network, Ideal Car has covered all of China's first-line, new-line and second-line cities, as well as 89% of the three-line cities. This year, we will continue to have the rhythm of going deeper into more cities to promote the continuous improvement of new energy car penetration rate. In addition, our service network is also constantly expanding to provide excellent services to ideal users. As of April 30, 2024, Ideal Car runs 481 retail centers in 144 cities across the country. Now translating for Mr. Leaf.