Li Auto Inc ( LI ) shares are tumbling today after the company cut the first-quarter FY24 vehicle deliveries guidance.

The company lowered the first-quarter vehicle deliveries outlook to 76,000-78,000 from 100,000-103,000 expected earlier. The guidance cut is owing to lower-than-expected order intake.

Related: EV Deliveries Continue To Fall In China As The Competitive Battle Rages On

Xiang Li, chairman and chief executive officer, said, “We planned operations of Li MEGA as if the model had already entered the 1-to-10 scaling phase, while in fact, we were still in the nascent 0-to-1 business validation period. Similar to Li ONE and our EREV technologies, Li MEGA and our BEV technologies will also need to undergo this 0-to-1 validation process.” 

“Next, we will first focus on our core user group and target cities with stronger purchasing power, recalibrating the Li MEGA strategy back to the 0-to-1 phase. After that, we will expand our reach to a broader user base and more cities.”

“We will lower our delivery expectations and restore sustainable growth by refocusing on enhancing user value instead of competition, while maintaining operating efficiency.”

Also Read: Buy Li Auto ( LI ) ‘MEGA Dip,’ Analyst Says: EV Maker Anticipates 3,000 Unit Deliveries A Month

Price Action: LI shares are down 7.31% at $31.59 premarket on the last check Thursday.

Image Via Shutterstock