Li Auto is reportedly undergoing substantial layoffs, with the company’s sales falling short of expectations. According to a report from local media outlet 21jingji, the layoffs could affect more than 18 percent of Li Auto’s overall workforce.
The carmaker’s 2023 financial report indicates a significant increase in its workforce, reaching nearly 31,600 employees, up 63 percent year-on-year. Based on the reported percentage of layoffs, Li Auto may reduce its workforce by more than 5,600 in the current round.
Specifically, the layoffs are said to be impacting various divisions within Li Auto, including the sales and service operations division, the hiring team, and the smart driving team. The company’s revised sales forecast for the year, lowered to between 560,000 and 640,000 units, has necessitated staffing adjustments.
Li Auto’s staffing adjustments this year were initially modest, focusing on removing low-performing employees. However, the company’s management approved a final list of layoffs at the end of April, with the bulk of the realignment expected to be completed by the end of May.
The smart driving team, which had been a focus of Li Auto’s previous expansion, had expanded significantly but is now being scaled back. The company’s ambitious sales target of 800,000 vehicles in 2024 is now considered challenging, particularly with its Li Mega MPV falling short of expectations.
Despite these challenges, Li Auto remains determined, launching its lowest-priced model, the Li L6, in April. The company’s current sales expectations for the year are around 560,000 units, a challenging target given its performance in the first four months.
