Zhejiang Leapmotor Tech Co

Last week in China, the largest-ever mass recall was carried out to address the possibility of being trapped inside electric vehicles during a power loss, with nine automakers including Tesla, Xiaomi, and Leapmotor announcing repairs for a total of 4.3 million vehicles. This move highlights the Chinese government's growing role in setting new safety standards for automobiles, and from 2027, retractable door handles will be banned due to safety concerns. In China, the world's largest EV market, where EVs account for about 55% of new car sales, the country may soon be in a position to set the tone in global automotive safety regulation, which has previously been led by the West. Pedro Pacheco, an analyst at consulting firm Gartner, said, "China is gradually approaching a leadership position in regulating advanced vehicle technology," and regulators are strengthening oversight, introducing rules that require automakers to track the condition and repair history of all EVs they sell.

Leapmotor aims to deliver one million vehicles in 2026, while pushing exports to 200,000 units, an increase of nearly three times from the previous year. Michael Wu, co-president of Leapmotor, told Bloomberg TV that the company remains on track to meet its goal after delivering 356,487 units in the first half, and expects to deliver more than 100,000 units per month through December. The company lowered its full-year profit forecast to 3 billion yuan from 5 billion yuan amid price competition and higher costs. Leapmotor plans to use the factory network of Stellantis, its largest shareholder, to expand production in Spain, Brazil, and Malaysia in order to reduce reliance on the Chinese market.

The draft amendment to the Road Traffic Safety Law introduces for the first time a dedicated chapter with special provisions for autonomous vehicles, clarifying that when traffic violations occur while autonomous driving functions are activated, the manufacturer or importer will be responsible for handling them, and requiring that autonomous driving functions must not be falsely or exaggeratedly advertised. The draft has 9 chapters and 170 articles, and also stipulates that autonomous vehicles must pass road traffic rule compliance testing and be legally registered before hitting the road, and implements a compulsory motor vehicle traffic accident liability insurance system. Cui Dongshu, head of the Passenger Car Market Information Joint Conference of the China Automobile Dealers Association, said this legal revision clarifies primary responsibility at the legal level and resolves the long-standing pain point of liability attribution. Market reaction was mixed. Hong Kong-listed new energy vehicle makers broadly fell, with XPeng down 9.19 percent, NIO down 3.45 percent, Li Auto down 3.60 percent, and Leapmotor down 5.71 percent. Among robotaxi concept stocks, Pony AI fell 5.62 percent and WeRide fell 3.95 percent. Meanwhile, the upstream intelligent driving industry chain was relatively resilient, with Desay SV down slightly by 0.45 percent, Momenta up 5.97 percent, and Horizon Robotics up slightly by 0.53 percent.

On July 16, eight domestic automakers held launch events, six of which were new vehicle unveilings, a density that has sparked industry concern over excessively rapid product cycles. According to an incomplete tally by Red Star Capital Bureau, GAC Group, Geely Auto, Great Wall Motor, Xpeng, Leapmotor, SAIC's IM brand, Li Auto, and SAIC-GM-Wuling all had activities that day, rolling out a total of seven all-new or refreshed models. In the first half of this year, 630 new car models were introduced in China, averaging 3.5 per day, while only 173 new phone models hit the market in the same period — meaning new car launches are now more than twice as frequent as new phone releases. BYD executive He Zhiqi bluntly called it 'completely insane,' noting that a new car typically requires an investment of over 1 billion yuan and a development cycle of more than two years, yet the buzz rarely lasts three months. Dongfeng Nissan executive Sun Hao went further, likening the pace of new car launches to that of beverages. The rapid iteration has created a 'new car effect death valley,' where vehicles sell well at launch but demand fades just as production capacity ramps up, causing severe supply chain volatility. Several automakers have already booked massive asset impairment provisions — for example, SAIC Motor set aside 6.773 billion yuan in asset impairment provisions for 2025, while GAC Group's cumulative intangible asset impairments over the past three years have exceeded 3.2 billion yuan.