Chip Shortage

Rising prices of memory chips and raw materials could lead to a cost increase of nearly 10,000 yuan ($1,460) for premium EV models, William Li said.

The updated Zeekr 007 GT, set to launch in the second quarter, will see a price increase amid rising chip and battery costs, according to a local media report.

Nio is experiencing a shortage of signal processing chips for the audio system in its ES8 SUV. Vehicles produced next month will utilize a short-term alternative solution.

If all cost increases are borne by automakers, they could completely erode profit margins, UBS said.

"Potential cost pressures this year are quite significant. The biggest cost pressure isn't raw materials, but memory chips," said William Li.

Starting December 22, newly produced ES8 cars will utilize a new temporary solution for the rear-seat entertainment chip to ensure deliveries.

Pressure from the supply chain has eased recently, and prices of core components including chips have fallen, but not by much, said Nio's William Li.

Xpeng CEO uses a KFC giveaway that went viral in China to express that the automotive industry is facing an ongoing chip shortage.

The waiting time for Li Auto consumers has now been reduced to a month to a month and a half from at least two months previously, according to China Securities Journal.

It seems Tesla isn't completely immune to chip shortages.