, , and are up over 100% since October. Recently, all of them have released their third-quarter financial reports, and their performance is also bright.

According to the China Association of Automobile Manufacturers, China sold 160,000 new energy vehicles in October, an increase of 104.5% year-on-year.

Among them, the sales of new energy passenger cars reached 148,000 units, with a year-on-year growth rate of 113.3%. Among them, the growth rate of pure electric vehicles was even faster, with a year-on-year growth rate of 128.8%, and sales reached 122,000 units.

The increase in sales also led to a significant improvement in the performance of new energy vehicle companies. According to the latest data released by the National Bureau of Statistics, auto production increased by 11.1% in October, among which new energy vehicles increased by 94.1%.

In its latest report, Founder Securities compares the development of the three new Chinese carmakers in terms of revenue, profitability, cash flow, product positioning, production capacity, and smart driving technology in the third quarter, and believes that their dawn has come.

The following is Founder Securities' detailed analysis.

China's new carmakers all achieved record-high revenues in the third quarter, mainly benefiting from the rapid growth of vehicle sales.

The significant subsidy rebate accelerated the exit of low-end production capacity, and new carmakers with better competitiveness and services continued to gain momentum, doubling their revenues in the third quarter compared to the same period last year.

Although there is still a gap between the overall profit of each company, the advantages of scale effect and strong momentum of gross profit improvement are highlighted.

Xpeng's gross profit margin of 4.6% turned positive for the first time; Li Auto's gross profit margin of 19.8% improved for the third consecutive quarter; Nio's gross profit margin of 12.9% improved by 4.5 percentage points from the previous quarter.

Nio's Q4 revenue guidance exceeds RMB 15 billion, with the release of its fourth model on the horizon.

Nio achieved total revenue of RMB 9.62 billion from Q1 to Q3, including RMB 4.53 billion in Q3, an increase of 146.4% year-over-year and 21.7% from the previous quarter, mainly due to a significant increase in deliveries.

Nio delivered 12,000 vehicles in the third quarter, including a record high delivery in October (0.5 million vehicles), and the company expects to deliver 16,500-17,000 vehicles in the fourth quarter, resulting in full-year revenue of over RMB 15 billion.

Nio's gross margin improved to 12.9 percent in the third quarter and net margin improved to -23.1 percent from -123.3 percent in the first quarter, thanks to ramped up demand and cost controls.

Nio's fourth and fifth models are positioned as mid- to high-end sedans, with the fourth model to be released soon with NP2.0 and further enhanced intelligent driving features (L2 level).

Xpeng turned positive in gross profit for the first time in the third quarter and increased investment in its own factory.

Xpeng achieved total revenue of RMB 2.99 billion from Q1 to Q3, including RMB 1.99 billion in Q3, an increase of 342.2% year-over-year and 236.7% from the previous quarter.

Xpeng delivered more than 2,000 vehicles in July and 3,478 vehicles in September, a record high for the month. The company expects to deliver 10,000 units in the fourth quarter and more than 24,000 units for the whole year, with revenue of RMB 5.19 billion.

Xpeng started construction of its Guangzhou plant in September and raised RMB 4 billion in external financing for the plant.

The plant's initial capacity is planned to be 100,000 units per year. In addition, with the release of capacity at its Zhaoqing plant (100,000 units per year), the company will have a future capacity of 350,000 units per year (150,000 of which will be built by Haima), which is expected to reduce costs in the future.

Li Auto sticks to its extended-range model in the short term, and the recall did not affect new orders.

Li Auto's revenue from the first quarter to the third quarter was RMB 5.31 billion, including RMB 2.51 billion in the third quarter, up 29.0% from the previous quarter.

In early November, the company issued a large-scale recall of its only model, the Li ONE, due to the structural strength of the front suspension, with a total of 10,400 units, accounting for about 48% of the company's total historical deliveries.

The recall reflects the company's commitment to quality, and downstream orders have not been significantly affected by the recall. The company expects to deliver 11,000-12,000 units in the fourth quarter and about 30,000 units for the year, with revenue of RMB 8.56 billion.

Considering the charging anxiety and range anxiety of pure EVs, the company will still choose the extended-range technology route until the 400KW fast charging technology matures.

Continued high sales and rapid revenue growth

The three companies' revenue was stable in the third quarter, maintaining a high revenue growth rate.

Revenue for Nio, Xpeng, and Li Auto totaled RMB 9.03 billion, up 44.3% QoQ.

Nio's revenue for the third quarter was RMB 4.53 billion, up 146.4% from the previous quarter, and reached RMB 9.62 billion from the first quarter to the third quarter.

Xpeng's revenue for the third quarter was RMB 1.99 billion, an increase of 342.2% YoY, and reached RMB 2.99 billion for the quarter to Q3.

Li Auto's revenue for the third quarter was RMB2.51 billion, up 29.0% from the previous quarter, and reached RMB5.31 billion for the quarter to three quarters.

Nio, Xpeng, and Li Auto are expected to post revenue growth of RMB 6.35 billion, RMB 2.20 billion, and RMB 3.25 billion, respectively, in the fourth quarter.

Scale effect is gradually emerging and losses are narrowing.

Nio's Q3 net profit was -RMB1.05 billion, a 58.9% narrower loss than the previous quarter and 13.5% narrower loss than the previous quarter.

Xpeng's Q3 net profit was -RMB1.15 billion, narrowed by 21.2% compared to the previous quarter.

Li Auto's Q3 net profit was RMB -1.1 billion, a small increase in loss from the previous quarter.

They had better orders in the fourth quarter and all companies are guiding high growth.

Their gross margins continue to improve, and all have turned positive.

Nio's gross margin for the third quarter was 12.9%, an increase of 4.5 percentage points from the previous quarter.

Xpeng's gross margin was 4.6 percent, an increase of 7.3 percentage points from the previous quarter.

Li Auto's gross margin was 19.8 percent, an increase of 6.4 percentage points from the previous quarter.

With high demand in the downstream market, the gross margins of these new carmakers have further improved, and all of them have turned positive in the third quarter.

Nio is the industry leader in R&D investment, maintaining high R&D investment.

The R&D expenses of Nio, Xpeng and Li Auto were RMB 590 million, RMB 640 million and RMB 330 million in the third quarter, RMB 1.66 billion, RMB 1.27 billion and RMB 730 million from the first quarter to the third quarter, respectively.

Their operating cash flow improved, and Li Auto's cash flow turned positive.

Nio's net operating cash flow outflow narrowed to RMB520 million in the first half of the year.

Xpeng's operating cash flow net outflow was RMB 1.21 billion in the first half of this year.

Li Auto's operating cash flow turned positive in the second quarter and continued to increase in the third quarter; the operating cash flow of these new carmakers improved significantly.

They maintained a high level of capital expenditures and continued to make strategic investments.

Nio's capital expenditure in the first half of this year reached RMB 570 million, up 16.7% year-on-year, mainly for the construction of charging and battery swap facilities, and continued to invest in offline experience stores.

Xpeng's capital expenditure in the first half of this year was RMB 520 million, a decrease of 54.1% year-over-year, mainly for new capacity expansion.

Li Auto's capital expenditures in the third quarter reached RMB 180 million, down 26.8% year-over-year, mainly for the construction of new bases and investment in new models.

Li Auto's and Xpeng's capital expenditures were affected by Covid-19, and it is expected that new carmakers will continue to expand their capital expenditures in the future.

Demand for new energy vehicles was strong, and deliveries continued to increase at a high rate.

Nio October deliveries were up 7.4% to 5055 units, and January-October deliveries were 31430 units.

Xpeng delivered 3,040 vehicles in October, down 12.6% from the previous month, and 17,117 vehicles in January-October.

Li Auto delivered 3692 vehicles in October and 21,852 vehicles in January-October, up 5.4% from the previous month.

The products of these new carmakers are more competitive than those of traditional carmakers, and are expected to account for more than 10% of total new energy vehicle sales for the year.

The transition from relying on OEMs to self-built plants has enhanced product quality control.

Nio is produced in the plant it built in cooperation with JAC and is currently planning a second plant in Shanghai, with a production capacity of 250,000 units by 2022.

Xpeng's own Zhaoqing plant has an annual production capacity of 100,000 vehicles, and its OEM plant in Haima, Zhengzhou has an annual production capacity of 150,000 vehicles.

Xpeng's self-built Guangzhou plant is already under construction and is expected to be completed in 2022.

Li Auto's self-built Changzhou plant is expected to expand production to 200,000 units by 2022.

Nio takes the high-end route, Li Auto sticks to the extended-range route, and Xpeng's price is more affordable.

The price and performance of these three companies' electric-powered vehicles are different, with Nio, Li Auto and Xpeng at the highest price point.

Among them, Li Auto is in extended-range mode, while Nio and Xpeng are pure electric cars.

In terms of acceleration time from 0-100 km and maximum power, Nio is better than Li Auto and Xpeng, and price has a strong correlation with acceleration ability and maximum power.

In terms of body structure, Nio and Li Auto are all SUVs, and only Xpeng has a sedan.

The Li Auto has the shortest charging time, mainly due to its extended-range drive.

The Li Auto has the shortest charging time, mainly due to its extended-range drive.

Nio, Xpeng, and Li Auto are sold in 95, 58, and 30 cities respectively, with sales areas concentrated in mega-cities and large cities.

Among the sales regions of Nio and Xpeng, mega-cities account for the largest share, 45% and 51% respectively, while mega-cities and large cities account for 82% and 90% respectively.

Li Auto covers 30 cities, with mega-cities and large cities accounting for 41% and 42% respectively, and a total of 83%.

The new car maker's sales area coverage is mainly concentrated in mega-cities and large cities.

Their smart driving technology path has changed from relying on suppliers to independent R&D. Currently, Nio and Xpeng have been developing their own smart driving technologies.

At present, Nio and Xpeng develop their own application layer software, while suppliers provide controllers, underlying software and core chips.

In the next three years, the new car makers will gradually increase their own R&D efforts and establish full-stack software development capability.

Nio's revenue guidance for the fourth quarter exceeds RMB 15 billion, and the release of its fourth model is imminent.

The company's revenue is rising fast and its cost control is remarkable. Nio's revenue for the third quarter was RMB 4.53 billion, up 146.4% year-over-year and up 21.7% from the previous quarter.

Its vehicle deliveries improved rapidly, reaching 12,000 units in the third quarter, an increase of 154.3% year-over-year and 18.2% from the previous quarter.

Its gross profit increased significantly in the third quarter and its loss narrowed by 44.4% from the second quarter, primarily due to the company's operational optimization and expense control in the third quarter and the impact of enhanced cost containment measures during Covid-19.

Its deliveries grew rapidly and reached another record high.

Nio delivered 5,055 vehicles in October, up 100.12 percent year-over-year. 12,206 vehicles were delivered in the third quarter, up 154.34 percent year-over-year, a new record for the third quarter.

Nio's JAC plant will produce approximately 5,000 units per month, and the fourth model of the Nio brand will be put into production in the JAC plant, with deliveries expected to reach 10,000 units in the fourth quarter.

Nio is positioned in the high-end market, and differentiation brings competitive advantage.

The Nio models take the high-end route, featuring sufficient horsepower, long range and ample space. Its models accelerate from 0-100 km in less than 5 seconds, have a maximum power of 400 kW, and are priced at RMB 400,000 and above.

Nio intelligent software supports multi-functional, industry-leading automatic driving.

Nio's intelligent software, Nio OS, features the automatic driving assistant NioPilo, the intelligent assistant NOMI, the audio version of the Nio Community - Nio Radio, and more.

Nio Pilot achieves an L2 autopilot level similar to Texcola's Autopilot autopilot system.

Nio Pilot consists of 12 ultrasonic sensors, five millimeter-wave radars, a forward-facing tricam, four surround-view cameras, and a driving condition monitoring camera.

NOMI's voice technology is supported by iFlytek, Nio Radio, an important platform for communication between Nio and its users, and also has access to popular applications such as QQ Music, Himalaya FM, Baidu Maps, and so on.

Nio's gross margin improved, expense ratio declined, and net margin steadily increased.

The company's gross margin improved significantly, turning positive for the first time in the second quarter and reaching 12.9% in the third quarter, up 4.5 percentage points from the previous quarter, mainly due to a steady increase in deliveries and improved cost control.

Nio's expense ratio was well controlled, with R&D expense ratio and sales expense ratio declining to 13.1% and 20.8% respectively, down 1.6 and 4.4 percentage points from the previous quarter, showing an overall downward trend.

Nio's net profit margin was -23.13% in the third quarter, up 8.5 percentage points quarter-over-quarter, with room for further improvement in the future.

Nio's R&D investment continues to increase, with a high proportion of design and development expenses.

The company's R&D investment has been increasing year by year, reaching RMB 4.43 billion in 2010, an increase of 10.8% year on year, of which design and development expenses and employee salaries accounted for a higher proportion, 46.1% and 45.3% respectively in 2010.

Nio's design and development expenses maintained a high growth rate of 11.7% YoY in 2010. The company maintained high R&D investment and focused on technological innovation.

Nio's asset mix has improved significantly and liquidity has increased.

Nio's liquid assets reached RMB 26.33 billion in the third quarter, an increase of 275.5% year-over-year and 74.5% from the previous quarter, resulting in a significant increase in total liquid assets. Its monetary funds and short-term investments accounted for 73.4% and 10.3% respectively in the third quarter.

Its debt is stable, with long-term borrowings dominating.

Nio's total debt was RMB 20.22 billion in the third quarter, down 10.6% from the previous quarter, with debt mainly coming from long-term borrowings. Its long-term borrowings, accounts payable and notes accounted for 33.5% and 24.4% respectively.

Nio continues to expand its production capacity, and planning for its own factories has begun.

Nio is planning a second plant in Shanghai, which is expected to reach full production capacity of 250,000 units by 2022.

Xpeng's gross profit turned positive for the first time and increased investment in self-built plants.

Xpeng's revenue reached an all-time high and the company turned profitable for the first time.

The company's third-quarter revenue was RMB 1.99 billion, up 342.5 percent year-over-year and up 236.9 percent from the previous quarter.

It posted operating income of approximately RMB2.99 billion from the first quarter to the third quarter, up 78.0% year-over-year, primarily due to continued growth in vehicle deliveries.

It delivered 8,578 vehicles in the third quarter, an increase of 71.6% from the previous quarter.

Its gross profit reached RMB 0.09 billion, turning a profit for the first time. Construction of its Guangzhou manufacturing base started and is expected to be completed in 2022 with an annual capacity of 100,000 units.

Xpeng deliveries decreased slightly and are expected to return to growth in the fourth quarter; October deliveries reached 3,040 units, down slightly by 12.6% from the previous month, and total January-October sales reached 17,117 units, with deliveries expected to remain high in the future.

Xpeng's current models are divided into P7 and G3, with standard versions priced at RMB169,800 and RMB254,900 respectively.

The G3 has superior performance compared to the P7, with a range of 706km and a price range of RMB 2,500,000.

The acceleration time from 0-100 km is 6.7 seconds and the maximum power is 196kW.

Xpeng intelligent software system Xmart OS has the voice assistant "Little P", OTA platform, APP remote control and intelligent navigation functions.

Its voice assistant "Little P" uses touch + voice to guide the user's habits, and is committed to replacing the traditional car operation with natural voice interaction.

Its OTA extends this "open possibility" to more diversified and personalized car use scenarios in the future through the "all-voice in-car system" and the integration of the entire hardware, software and underlying architecture.

By downloading Xpeng APP, users can control the car remotely, control the air conditioner, open and close the windows, find the car and charging station, and check the environment around the car with the remote camera.

Its intelligent navigation is equipped with Gaode based custom maps with rich data reserves and accurate positioning and can display the location of Xpeng Superchargers.

In addition, the center screen can also be intelligently linked with the LCD instrumentation to synchronize the display of driving, navigation as entertainment, and other information.

Its gross margin turned positive for the first time, the expense ratio was well managed, and net margin loss narrowed.

Its gross margin was 4.6% in the third quarter, up 7.4 percentage points from the previous quarter, turning positive for the first time.

Its R&D expense ratio and selling, administrative and general expenses ratios were 13.3% and 13.6%, down 50.0 and 66.0 percentage points, respectively, and the expense ratio remained on a downward trend for 20 years.

It has significantly increased its liquid assets, with nearly 80% of its liquidity.

The significant increase in liquidity in the third quarter was mainly due to the rapid increase in deliveries and access to liquidity; it had 52% of monetary funds and 25% of short-term investments.

Xpeng's debt is stable, with a high percentage of accounts payable.

Its total debt reached RMB 8.07 billion in the third quarter, and the increase in order volume led to a significant year-over-year increase in debt. The company's accounts payable and long-term loans accounted for 43.3% and 20.7% of its total liabilities, respectively.

The company's capital expenditures for the first half of the year amounted to RMB520 million, a significant decrease from the same period last year. The company recently signed a cooperation agreement with the Guangzhou government, and the construction of its Guangzhou base with an annual production capacity of 100,000 vehicles has started, which is expected to return to a high level of capital expenditure in the future.

Its capacity expansion is accelerating, and construction of the Guangzhou base has begun.

The company currently has two production sites, the Haima Automotive OEM plant and its own Zhaoqing plant.

In 2017, it signed a cooperation agreement with Haima OEM, mainly for the production of Xpeng G3.

The first phase of its Zhaoqing plant is planned to have a capacity of 100,000 units per year and enter mass production by the end of March 2020.

The Guangzhou manufacturing base has already broken ground and is expected to be completed in 2022 with a production capacity of 100,000 units per year.

The market is highly prosperous, and Xpeng's penetration rate is expected to accelerate.

Xpeng's penetration rate reached 2.3% in October, and market demand continues to expand, with the company's future capacity expansion, there is still a large room for upward penetration.

Li Auto still insists on the extended-range route in the short term, and the recall has not affected new orders.

Li Auto's revenue improved rapidly and deliveries reached new highs.

Li Auto's revenue for the third quarter was RMB 2.511 billion, an increase of 28.94% from the previous quarter, and the number of vehicles delivered increased rapidly.

Li ONE deliveries reached 8,660 units in the third quarter, up 31.13% from the previous quarter.

Li Auto generated revenue in the first quarter and is still in the loss-making phase, with an operating profit of RMB 180 million in the third quarter, mainly due to the company's ongoing capacity building cycle and offline channel expansion.

Li ONE is a mid-to-high-end SUV, priced at RMB 328,000 for the standard version (6 seats), with a range of 180km in pure electric mode, 0-100km acceleration time of 6.5 seconds, and a maximum power of 240kW.

Its intelligent system continues to be upgraded, and its software is fully functional.

Li Auto's intelligent operating system, Li OS, has functions such as vehicle control and automatic driving and is currently undergoing continuous improvement.

The development of the system is also modeled after 's: the first generation of products completed terminal manufacturing, the second generation realized its own hardware integration and real-time operating system, and the third generation used its own chips.

Li Auto plans to develop its own real-time operating system for the second generation of products.

Currently, the Li ONE software system is equipped with a large number of intelligent applications, including online music listening, video watching and navigation functions.

Li Auto's gross margin improved and expense ratio was stable.

The company's gross margin improved, increasing by 6.4% in the third quarter from the previous quarter, mainly due to upstream material price cuts and cost reductions due to economies of scale, with room for further improvement.

Li Auto's expense ratio was well controlled in the first quarter and slightly improved in the third quarter, mainly due to the company's equity incentives and stock option grants to employees, resulting in a slight decrease in net profit margin.

Li Auto's R&D investment in design and development expenses exceeded 50%, and the company's R&D expenses in 2019 will reach RMB600 million, an increase of 42.4% year-on-year, with design and development expenses and employee compensation accounting for the highest proportion of R&D expenses, 51.6% and 39.5%, respectively.

Li Auto's liquid assets have improved significantly.

Compared to the second half of 2019 and the first half of 2020, Li Auto's total liquid assets increased significantly in the third quarter of 2020 to RMB 20.577 billion, an increase of 292.70% year-over-year. This was mainly due to the completion of the company's IPO and targeted issuance.

In the third quarter financial results, Li Auto's time deposits and other short-term investments, money funds, inventories, and restricted cash accounted for 58.83%, 31.45%, 4.20%, and 1.65%, respectively.

Li Auto's liabilities are stable and consist primarily of accounts payable.

Li Auto's total debt was RMB5.052 billion in the third quarter of 2020, down RMB260 million from the previous quarter.

Li Auto's order volume has increased since 2020, the company has increased its investment and production, and its liabilities have increased compared to 2019.

Among them, accounts payable and notes payable are the main source of debt, with accounts payable and notes payable and long-term loans accounting for 41.0% and 10.0%, respectively.

Li Auto's investment efforts increased significantly.

In the third quarter, the company's cash flow from investing activities increased by RMB 9.88 billion, an undisclosed amount and a significant increase over previous reporting periods.

The company's shift from relying on OEMs to building its own factories has resulted in lower costs and more effective quality control.

The company currently has one self-built factory, a manufacturing facility in Changzhou, Jiangsu province.

Unlike other new carmakers that use OEMs, its factory will be completed in 2019, four years after the founding of Li Auto.

The plant has four workshops: stamping, welding, painting and final assembly, and a road test site. Its first phase has an annual production capacity of 100,000 vehicles, and it expects to have an annual production capacity of 200,000 vehicles in the future.

The order growth rate has not been affected by the recall.

Starting November 7, the company announced a large-scale recall of 10,469 Li ONE electric vehicles with production dates from November 14, 2019 to June 1, 2020.

The recall accounts for nearly half of the company's total deliveries of less than 23,000 vehicles through October 2020.

Since the recall was announced, the company's order intake has not been significantly affected, and the growth rate of new orders is consistent with that before the recall.

Li Auto's share is stable, and there is still room for upward penetration in the future.

Since the national new energy passenger car sales picked up in July, Li Auto's sales volume has remained stable at around 3% of the national sales volume, and the company's service and driving experience are better.