Li Auto has become one of the most heavily targeted stocks by short sellers among Chinese automakers, as weakening sales and intense competition erode confidence in what was once the sector’s strongest performer.
Short positions in Li Auto’s Hong Kong-listed shares rose to 9.6% of free float as of Wednesday, the highest level on record, up from about 1% a year earlier, according to S&P Global data cited by Bloomberg. The company has been the most heavily shorted Chinese automaker since September, Bloomberg data showed.
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Li Auto’s shares have fallen about 25% over the past year, even as the broader Hong Kong equity market advanced, making the stock attractive to investors betting on further declines. According to data from S3 Partners, Li Auto ranked as the second-most profitable short in the Asia-Pacific region last year, behind Chinese food delivery group Meituan.
“Shorting demand is expected to remain elevated but volatile as Li Auto navigates a strong competitive environment,” said Matt Chessum, director of securities finance at S&P Global Market Intelligence, according to Bloomberg.
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The rise in bearish bets comes as Li Auto struggles to regain momentum after years of rapid growth. The company delivered 376,030 vehicles in 2023, a surge of more than 180% year on year, and followed with a record 500,508 deliveries in 2024. In 2025, however, deliveries fell nearly 19% to 406,343 units, with declines recorded in most months.
Amid the slowdown, Li Auto is reviewing the closure of some underperforming retail outlets to improve efficiency, local media outlet Lanjinger reported on Thursday, citing a source. Separately, Auto Report said some employees at the company’s main manufacturing base in Changzhou, Jiangsu province, had begun taking leave well ahead of the Lunar New Year holiday.
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Once viewed as one of China’s most financially resilient electric vehicle startups, Li Auto is now facing mounting pressure as rivals expand aggressively and the domestic EV market shows signs of saturation.