Leapmotor’s high-end new brand is ready to launch.

```

After navigating the volatility of the off-season, Leapmotor finally revealed its cards.

On May 15, 2026, Leapmotor delivered its Q1 report: sales increased by over 25% year-on-year, but revenue saw only a slight rise of 8%, and gross margin was adjusted up 5.5 percentage points to 9.4%. During the slow car sales season at the beginning of the year, Leapmotor was not spared, experiencing a correction like many peers.

At the earnings meeting that evening, CFO Li Tengfei confirmed that Q1 sales were affected by industry seasonality, preventing full release of scale effects. Production capacity and parts reserves increased compared to the same period last year, but sales growth was limited due to seasonal factors, resulting in reduced capacity utilization and a clear rise in manufacturing costs.

In addition, there was a change in model structure. Last year’s sales were mainly focused on the C series, while in Q1 this year the B series accounted for a higher proportion. The B series has slightly lower gross margins than the C series, making this one of the key reasons for the year-on-year decline in Q1 gross margin.

Even so, Li Tengfei reiterated that the 5 billion net profit goal for this year remains unchanged and expressed continued confidence in achieving the million-unit sales target. Li Tengfei is not just managing market expectations; in fact, the bottoming-out phase has already been completed this year, and growth is expected to resume in the second half. Leapmotor also holds two trump cards: the highly anticipated overseas business and the long-rumored second brand, which has now been confirmed to exist.

Breaking it down, compared to Q1, Leapmotor’s sales in Q2 have already started to rise rapidly.

In just-passed April, Leapmotor’s monthly deliveries broke 70,000 units again, reaching 71,387 units, a year-on-year increase of 73.9%. This result ranked first among new car-making brands and set a new sales record for the company. The newly launched A10 was the biggest contributor to the incremental growth.

Leapmotor Senior VP Cao Li told WallstreetCN that at the end of April, the A10 began double-shift production, expecting 26,000–27,000 units in May, and hoping to achieve over 30,000 in June, possibly even 35,000–36,000 units, with delivery speeds increasing. The D19 is also accelerating its production ramp-up.

Leapmotor has high expectations for Q2, with sales guidance of 240,000–250,000 units. This means, deducting April's 71,000 units, May and June could reach an average monthly sales level of 87,000 units.

The continued hot sales of A10 and D19 provide ample incremental space for the following three quarters. The soon-to-be-launched flagship SUV D99 and compact sedan A05 will become important new growth points. In the second half, with upgrades to B and C series products and the rollout of new advanced intelligent driving, Leapmotor will enter a rapid expansion period after Q2. However, it must be noted that the domestic auto market has entered a stage of stock competition.

This is the core support for its bold claim to earn 5 billion this year despite Q1 losses.

However, this is still just stock competition. Multiple automotive executives told WallstreetCN that the total scale of the domestic auto market may slow sharply this year. Leapmotor’s ambition is to become a new giant, so expanding incremental sales and improving profit margins are always key tasks for this dark horse.

On the overseas front, standing on the shoulders of Stellantis, Leapmotor has begun accelerating its releases.

In Q1, Leapmotor exported 40,901 units, surging 442% year-on-year, accounting for 37.1% of total sales. Leapmotor International expects to break even in 2024 and turn profitable in 2025—a rare feat among the new forces going overseas.

By country, in Q1 Italy registered 11,637 units, taking the top spot in pure EV sales for two consecutive months; in Germany, 1,258 units were sold in March, making Leapmotor the No.1 Chinese BEV brand. The combined registration in 16 European countries was eight times higher year-on-year.

In Q4, the Spain factory will start CKD mass production. The A10 will enter Europe in Q3, and the D series will gradually be introduced. With the overseas mode already validated by sales, Chairman Zhu Jiangming stated that the 37.1% overseas ratio is not the end. His own target is a domestic-overseas split of 60:40, so Leapmotor is raising this year’s export expectations to over 150,000 units.

However, as competition among carmakers intensifies and auto consumption remains weak, it remains difficult to predict when the price war will end.

Although Leapmotor’s “Uniqlo of the car industry” positioning allowed it to outpace the market in scale, the profit correction in Q1 was a wake-up call. According to some analysts, Leapmotor’s model structure still shows a sinking trend, so boosting the average car transaction price and beefing up profit cushion is key to a long-term strategy.

At the earnings meeting, Li Tengfei confirmed a second high-end brand, with its first product debuting as early as the end of this year and at latest by mid-next year. Unlike the current first brand, which focuses on the mass market with “leading configurations + high value-for-money,” the second brand will be aimed fully at the high-end market.

In other words, Leapmotor will break through the 300,000 yuan price ceiling by launching its second brand, seeking greater profit margins.

Additionally, in 2026, Leapmotor will further promote self-developed parts supply to external customers. Its joint car project with Hongqi will launch in Q4, and cooperation with Stellantis’s Opel brand is being actively promoted.

Industry insiders see these as peripheral dividends from self-developed technology. Increasing the proportion of high-end products and expanding overseas simultaneously drives explosive scale growth, amplifying the leverage effect of self-developed technology.

China’s automotive industry has entered the latter stages of the survival-of-the-fittest competition. In the past, it was all about storytelling. Later, it was about who dared to engage in price wars. Now, it’s about who can build systematic competitiveness. Judging from Leapmotor’s various recent moves, it is clearly not content to be just a flexible new force. It wants to be the next true Chinese auto giant.

Risk Warning and DisclaimerThe market involves risks. Investment should be approached cautiously. This article does not constitute personal investment advice, nor does it take into account the specific investment objectives, financial situations, or needs of individual users. Users should consider whether any opinions, views, or conclusions presented in this article are suitable for their particular circumstances. Investing based on this is at your own risk. ```