Li Auto lowered its guidance for first-quarter deliveries last week, and Tesla has reportedly reduced EV production at its China factory.

Nio had previously guided first-quarter revenue to be between RMB 10.499 billion ($1.479 billion) and RMB 11.087 billion ($1.562 billion). Its statement today made no mention of any adjustments to its revenue guidance.

On March 21, Li Auto lowered its guidance for vehicle deliveries in the first quarter to between 76,000 and 78,000 units, down about 24 percent from its previous guidance of 100,000 to 103,000 units, citing lower-than-expected order intake.

Li Auto's updated delivery guidance means it expects to deliver between 24,584 vehicles and 26,584 vehicles in March, considering it delivered 31,165 in January and 20,251 in February.

Li Auto said on March 1 that it was targeting a rebound in monthly deliveries to 50,000 units in March. The latest guidance means that it will only reach about half of its original target for this month.

A day after Li Auto lowered its guidance, Bloomberg, citing people familiar with the matter, reported that Tesla (NASDAQ: TSLA) has reduced production of EVs at its China factory due to sluggish growth in sales of new energy vehicles (NEVs) and fierce competition in the market.

Tesla instructed employees at its Shanghai factory earlier this month to reduce production of the Model Y and Model 3 by working five days a week instead of the usual 6.5 days, according to Bloomberg.

The production lines run on two daily 11.5 hour shifts, which remains unchanged, according to the report.

The production cuts began earlier this month, and staff have yet to get a clear update on when production will return to normal, the people familiar with the matter said.

Notably, Chinese NEV sales rebounded significantly so far this month compared to the previous month. The February 10-17 Chinese New Year 2024 holiday had a significant disruption to February sales.

During March 1-24, China's passenger NEV retail sales stood at 490,000 units, up 39 percent from a year ago and up 84 percent from a month ago, according to data released today by the China Passenger Car Association (CPCA).

Retail sales of all passenger vehicles in China during the period were 1,028,000 units, up 11 percent from the same period last year and up 25 percent from the same period last month.

Li Auto cuts guidance for Q1 deliveries due to lower-than-expected order intake