In 2024, Leapmotor emerged as a "dark horse" in the fiercely competitive automotive market, successfully "breaking through" the barriers.

Specifically, the company sold over 290,000 vehicles, ranking third among new energy vehicle manufacturers, trailing only Li Auto and Hongmeng Zhixing.

Breaking down monthly sales, Leapmotor's sales surged notably after entering the third quarter of 2024. Sales surpassed 20,000 vehicles in June, 30,000 in August, and 40,000 in November. With sales rapidly accelerating in the second half of the year, Leapmotor achieved a positive net profit in the fourth quarter, becoming the second profitable new energy vehicle manufacturer after Li Auto.

While Leapmotor undoubtedly achieved remarkable results in 2024, significant challenges remain for 2025.

Sales data indicates that Leapmotor sold 25,170 and 25,287 vehicles in January and February 2025, respectively, with year-on-year growth rates of 105% and 285%. However, compared to sales exceeding 40,000 vehicles in November and December of the previous year, sales have declined. This decline is partially attributed to the Spring Festival, but overall, Leapmotor's momentum is weaker than it was at the end of 2024.

Beyond the decline in sales, the wave of "intelligent driving" poses another challenge. Historically, Leapmotor's core competitiveness lay in its "extreme cost-effectiveness." Leveraging its in-house full-stack research and development capabilities, Leapmotor could still offer "low price, high configuration" products in a highly competitive market. However, with the advent of the "intelligent driving" trend, high cost-effectiveness is no longer the primary concern for consumers, potentially weakening Leapmotor's competitiveness. Additionally, Leapmotor's lack of prominence in intelligent driving could become a significant "hidden danger" for the company in the future.

Hidden Dangers Behind Sales

2025 is heralded as the "Year of Intelligent Driving" in the new energy vehicle industry.

After two consecutive years of price wars, automakers' room for price reductions has been drastically reduced. Against this backdrop, automakers have shifted their focus to intelligent driving.

On February 9, Deep Blue Auto, a subsidiary of Changan Automobile, took the lead in introducing intelligent driving with a full-scenario intelligent driving solution conference. The following day, BYD announced that its advanced intelligent driving system, Tian Shen Zhi Yan, would be available across all BYD models, with the first batch of 21 models ranging from 70,000 to 200,000 yuan, shocking the entire industry.

Following BYD, Geely and Chery have also successively released AI and intelligent driving solutions. Even Tesla's long-rumored FSD recently announced that it would update the software in batches for Chinese customers.

As BYD Chairman Wang Chuanfu stated, "Models without intelligent driving will be considered outdated in the future."

Faced with the intelligent driving wave, Leapmotor, the "dark horse" of 2024, has also taken action. According to media reports, Leapmotor recently announced its intelligent driving plan: to achieve nationwide coverage of urban expressways and elevated NAP functions in the first quarter of 2025, encompassing three models—Leapmotor C10, C11, and C16; and to launch advanced urban intelligent driving functions in the second half of 2025, pushing them to users through free OTA upgrades.

Admittedly, Leapmotor possesses certain technical reserves in intelligent driving, but according to media reports, its intelligent driving technology is not at the forefront. Industry experts note that while Huawei's ADS 3.0 and XPeng's XNGP have already achieved city navigation, Leapmotor's intelligent driving is still at the L2+ level. Currently, there is an 18-month technology generation gap between Leapmotor's intelligent driving solution and leading enterprises' mapless city NOA.

Further analysis reveals that Leapmotor Pilot 4.0, equipped on Leapmotor's current main models, relies on a high-precision map solution that currently only covers highways and some urban elevated roads and expressways. Due to the high cost of high-precision map production, there is also the issue of insufficiently timely data updates.

It is worth noting that intelligent driving is an extremely "expensive" technology that requires substantial investment. Therefore, insights can be gained from R&D investment. Financial reports show that from 2022 to the first half of 2024, Leapmotor's R&D expenditures were 1.411 billion yuan, 1.92 billion yuan, and 1.221 billion yuan, respectively. In contrast, XPeng, renowned for its intelligent driving technology, had R&D expenditures of 5.215 billion yuan, 5.277 billion yuan, and 2.817 billion yuan from 2022 to the first half of 2024, respectively.

Previously, in response to various automakers accelerating their transition to intelligent driving, Leapmotor Chairman Zhu Jiangming made a bold statement: Leapmotor will rank among the first tier in intelligent driving in 2025. This claim requires time to verify.

How Much Upside Potential Remains?

With the rapid rise in sales in the second half of the year, Leapmotor achieved a positive net profit in the fourth quarter of 2024, becoming the second profitable new energy vehicle manufacturer after Li Auto.

However, since entering 2025, Leapmotor has gradually shown signs of "running out of steam." In terms of sales, Leapmotor sold 25,170 and 25,287 vehicles in January and February, respectively, with year-on-year growth rates of 105% and 285%. Nevertheless, compared to the momentum of sales exceeding 40,000 vehicles in November and December of the previous year, it has weakened significantly.

So, can Leapmotor, which achieved remarkable sales in 2024, continue to "lead the pack" in 2025? The answer is fraught with uncertainties.

Looking back at Leapmotor's performance over the past year, it is evident that the key to its success lies in its extreme "cost-effectiveness."

Taking Leapmotor's best-selling model C11 as an example, the range-extended version of C11 was launched in March 2023 with an official guide price of only 149,800 to 185,800 yuan. The C11 intelligent driving version, released in May 2024, equipped with more than 30 sensors and a full set of NVIDIA intelligent driving chips, is priced at only 185,800 yuan (range-extended version), while the pure electric intelligent driving version starts at just 155,800 yuan, which is at least 50,000 yuan cheaper than other models with similar configurations on the market.

However, behind this extreme "cost-effectiveness" lies Leapmotor's extremely low gross profit margin. According to financial report data, Leapmotor's gross profit margin was only 0.48% in 2023. Although it increased by more than 7.5 percentage points to 8% in 2024, it is still much lower than the gross profit margins of competitors such as Li Auto and Thalys, which are as high as 20%. From the perspective of gross profit margin, Leapmotor has maximized the advantage of "cost-effectiveness" in 2024. In other words, if it maintains the original approach, it will become increasingly difficult for Leapmotor to continue increasing sales.

Apart from extreme "cost-effectiveness," another key to Leapmotor's success in 2024 was benefiting from the explosive growth of range-extended models.

According to statistics, sales of range-extended vehicles reached 642,000 units in 2023, with a year-on-year increase of 181%. In 2024, sales of range-extended vehicles reached 1.167 million units, with a year-on-year increase of 78.7%. It is evident that the "market size" of range-extended models has rapidly expanded over the past two years. Leapmotor, which began launching range-extended models in 2023, benefited from this round of industry dividends.

However, although sales of range-extended vehicles are still growing in 2024, compared to 2023, it is clear that the growth rate of sales of range-extended vehicles has significantly slowed down in 2024. Entering 2025, with the advancement of pure electric technology, the sales growth of range-extended vehicles is likely to continue slowing down. Without the key driving factor of industry growth, it will be challenging for Leapmotor to maintain its growth momentum.

Overall, Leapmotor's two major strategies for driving sales growth in the past—price reductions and range-extended models—have been maximized in 2024. Nowadays, with the wave of intelligent driving sweeping in, Leapmotor itself is also in a state of catching up in this regard. Against this backdrop, the pressure on Leapmotor to continue "leading the pack" in 2025 is likely to be considerable.