How did Leapmotor achieve high growth? How can it sustain this growth?

On September 8th, the Munich Auto Show in Germany brought Leapmotor into the international spotlight. During the auto show, Leapmotor launched a new personalized model called Lafa5. Meanwhile, it announced the official launch of the B10 in overseas markets and initiated deliveries in Europe.

The Lafa5 is built on the LEAP 3.5 architecture and is positioned as a high - appearance sports sedan. It is planned to be launched in the domestic market in the fourth quarter of this year and enter the global market in the first half of next year. Leapmotor's official previously emphasized that this model is not targeting a niche market but also has mass - market appeal.

"From now on, LaFerrari is no longer just a plaything for the wealthy; it can also serve the people," an industry insider told Caijing after watching the press conference.

Leapmotor Chairman Zhu Jiangming is promoting new cars to the global market. Source: Leapmotor

What really put Leapmotor in the industry spotlight is not just the overseas launch of new cars. From winning the domestic new - energy vehicle sales championship six times in a row, being the second new - energy vehicle company among domestic new forces to achieve profitability in half a year, being rumored to have "FAW invest" and the negative statement about "cooperating with Huawei", to the implementation of a 2.6 - billion - yuan investment from Zhejiang state - owned assets, Leapmotor has always been at the center of public opinion.

On September 7th, Leapmotor Chairman Zhu Jiangming announced on his social platform that the total orders for all Leapmotor models on that day reached 4,663, a record high. He also said that Leapmotor has ranked among the top in sales in key European markets such as Germany, France, Italy, and Spain. In August, it surpassed BYD and topped the German pure - electric vehicle market.

However, the spotlight in Munich does not cover up the real problems Leapmotor faces. When traditional giants like BYD and Geely focus on the same - level market, Leapmotor's gross profit margin has long hovered around 14%. Leapmotor's high - growth path has not only enabled it to quickly increase sales volume but also pushed it to an inflection point related to survival: Does the cost - performance model really have the ability to withstand market cycles?

The High - Growth Dividend of Cost - Performance: Monthly Sales of 50,000 and a Target of One Million Next Year

Leapmotor took ten years to transform from a marginal player in the market to a leading new - energy vehicle brand. From selling only a few hundred units per month for a single model in 2019 to exceeding 10,000 monthly sales with the C11 series in 2022, Leapmotor entered a period of rapid growth in 2024. In August this year, Leapmotor's delivery volume reached 57,100 units, and the cumulative delivery volume within the year exceeded 320,000 units. In the overseas market, the export volume in the first eight months has exceeded 30,000 units.

What supports this performance is the dual - wheel model of "ultimate cost - performance + full - domain self - research". By self - researching, Leapmotor controls the cost of 65% of core components, enabling it to build a "low - price, high - configuration" competitiveness in the product. The B series targets the 100,000 - yuan market; the C series focuses on the 150,000 - 200,000 - yuan range to meet mainstream household needs; the upcoming A series will target the market below 100,000 yuan, and the D series aims at the high - end market of 300,000 yuan. The A, B, C, and D series cover different price ranges.

"The perception that Leapmotor offers 'half - price Li Auto' has become deeply rooted. Leapmotor basically has all the configurations of Li Auto, but at a much lower price, so it's natural that sales are up," an industry insider said. In August this year, relying on its ultimate cost - performance, Leapmotor became an alternative choice for more and more young families. Its sales volume in that month was twice that of Li Auto, which confirmed the market appeal of the "half - price Li Auto" label.

Take the C10, the main model of Leapmotor's C series, as an example. It is priced from 128,800 yuan to 168,800 yuan and offers both pure - electric and extended - range versions. Thanks to its cost - performance, it has won the sales championship among domestic new - energy vehicle brands for many months. However, in the mid - size SUV segment, the C10 mainly meets the mid - range demand and competes in a staggered way rather than directly competing with leading products. Even if the price factor is excluded, there is still an obvious gap between the extended - range version of the Leapmotor C10 and the Li L6 and L7. In July this year, the monthly sales volume of the Li L6 was 14,830 units, with a cumulative sales volume of 110,000 units; the sales volume of the L7 was 6,237 units, with a cumulative sales volume of 54,000 units; while the sales volume of the extended - range version of the Leapmotor C10 was 3,251 units, with a cumulative sales volume of 22,000 units.

In terms of power type, the BYD Song PLUS is the most direct competitor of the C10. From January to July 2025, the cumulative sales volume of the Song PLUS family exceeded 300,000 units, while the cumulative sales volume of the C10 family in the same period was about 78,000 units. Although its performance is commendable, it has not yet broken through the ceiling of this segment.

In the entry - level 100,000 - yuan market, the B series shoulders the task of increasing sales volume. Take the B01 as an example. It is positioned as a 100,000 - yuan pure - electric sedan, with the selling point of being a "half - price Model 3" and competing with the XPeng MONA M03. Its top - configuration price is only comparable to that of XPeng's entry - level model, but thanks to its rear - wheel drive layout, 650 - kilometer range, and handling performance, it exceeded 10,000 monthly sales in the second month after its launch. The B10 in the same series also performed strongly, with sales volume exceeding 40,000 units in more than four months after its launch.

Regarding the sales explosion of the above models, Zhou Ying, the vice - president of Leapmotor, believes it is the result of "the scale effect and word - of - mouth effect after a certain stage of technological accumulation", and "making the product competitiveness redundant enough" is the core way to implement Leapmotor's cost - performance strategy.

Currently, Leapmotor is expanding the scale effect through channel expansion and the overseas - going strategy. As of June 2025, with the cooperation with Stellantis, Leapmotor has established more than 600 sales outlets in 30 countries and regions in Europe, the Middle East, etc., and plans to locally produce the B10 in Europe next year. At the Munich Auto Show, Zhu Jiangming revealed that the number of global sales and service outlets has exceeded 1,700.

Based on the current growth trend, Leapmotor has set a target of one - million annual sales in 2026, which requires an average monthly delivery of 80,000 - 100,000 units. The B and C series will each contribute 40,000 units, and the A and D series will jointly contribute 20,000 - 30,000 units. Cao Li, the senior vice - president of Leapmotor, optimistically predicts that the potential of all models will exceed one million units after they are all launched.

The Sustainable Challenges of the Cost - Performance Route: How to Balance Scale and Brand

Although Leapmotor is growing rapidly, its cost - performance route is facing multiple challenges. The industry generally believes that in the next three years, annual sales of one million will become the new threshold for leading automobile companies.

As He Xiaopeng, the chairman of XPeng Motors, said, "In the next three years, the competition in the automobile market will be very fierce. Annual sales of one million units no longer mean much. The core in the future is who can reach ten million units in the fastest time, which represents having a sufficient market share in this market."

This means that annual sales of one million are changing from a "label of leading new - energy vehicle brands" to an "industry entry ticket". If Leapmotor cannot continuously expand its scale, even if it reaches this target, it may lag behind in subsequent price wars, R & D wars, and technology wars.

It is worth noting that Leapmotor achieved a net profit of 30 million yuan in the first half of this year, turning losses into profits and becoming the second domestic new - energy vehicle company among new forces to achieve profitability in half a year. Zhu Jiangming attributes this to platformization and cost optimization brought by full - domain self - research, as well as the fixed - cost reduction through the scale effect.

However, scale expansion is only the first half of the battle. Whether Leapmotor can achieve a "qualitative change" in profitability and brand building is the key to determining whether it can withstand market cycles.

Between "scale" and "profit", Leapmotor has chosen the former. "We set prices based on cost and do not pursue high gross profit margins. Our goal is to become a global automobile company, so we must first expand the scale," Cao Li said bluntly. A gross profit margin of 14% - 15% is "relatively reasonable", and at this stage, the priority is to "expand market share".

While expanding the scale, brand upgrading has become an inevitable path for Leapmotor, but it is much more difficult than increasing sales volume.

Now Leapmotor is entering the high - end market with the 300,000 - yuan D series. Cao Li said he is confident that "the models in the 300,000 - yuan price range can have the competitiveness of models above 500,000 yuan", but he also has to admit that "brand premium needs time to accumulate, which is gradually built through user word - of - mouth, product competitiveness, and technological advantages".

Data from third - party institutions show that in the first seven months of this year, Leapmotor's main markets were new first - tier, second - tier, and third - tier cities. Consumers in these regions pay more attention to practicality and cost. In first - tier cities, which are the "battlegrounds" for automobile brand high - endization, Leapmotor's sales volume accounts for less than 8%.

When the C16 was launched last year, Zhu Jiangming emphasized focusing on the price range below 200,000 yuan to enhance product advantages and sales scale by concentrating the user group. "If you want to target both high - end and low - end markets, with different user groups and products, the battlefront will be stretched too long," Zhu Jiangming said frankly.

More importantly, Leapmotor's existing users are mostly concentrated in the 100,000 - 200,000 - yuan price range. They are highly price - sensitive and have low brand loyalty.

Regarding the feasibility of the high - endization path, Zhang Junyi, a former partner of Roland Berger and a senior industry expert, told Caijing, "Today's young people pursue high cost - performance. If a company blindly pursues a high - end route in the domestic market, only considering brand premium based on historical accumulation without considering the current price acceptance, it will be difficult to sustain. We can already see the limitations. The purchasing power needs to be further stimulated. In a market where similar products are crowded, a company needs to maintain its brand advantage and cannot rely on high prices to build a moat. Relying on past achievements or wishful thinking actually has no market, as users have too many choices. Only products with high cost - performance, functions and emotional values that can impress buyers, unique and easy - to - understand selling points, and high appearance can become blockbusters."

Therefore, for Leapmotor, the problem is not only whether the high - growth dividend can be sustained but also whether it can complete a transformation from a "sales star" to a "value giant" before the dividend fades. This test is far more severe than achieving the one - million - sales target.

This article is from the WeChat public account "Caijing Auto". Author: Wang Xin, Zhao Cheng. Republished by 36Kr with permission.