Selecting Your Chinese NEV Stock: An Ultimate Guide To NIO, XPeng, And Li Auto

Feb. 23, 2021 11:45 AM ETTSLA, LI, NIO, XPEV37 Comments
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  • NIO, XPeng, and Li Auto share similar business development trajectories in the Chinese auto market.
  • Their management teams are from divergent backgrounds and the companies prefer different types of talents.
  • Both top Chinese capital managers and local governments support these EV pioneers.
  • NIO is the absolute sales leader in the segment, while XPeng's NGP has the best features of autonomous driving.
  • We remain bullish on NIO and XPeng in 2021, keeping our targets at USD 62 and USD 72 respectively.

The electric vehicles ("EVs") market was under the spotlight in 2020. Benefiting from the rocketing value of Tesla (TSLA), Elon Musk became the richest person in the world. Meanwhile, a few EV startups, including XPeng (XPEV) and Li Auto (LI) went public, attracting diverse investors' attention. Their compatriot NIO (NIO), which went public in 2018, saw its stock surge by 1,110%. While some investors place bold bets on these companies, increasing the growing avalanche of hype, some believe these stocks are not worth investing in, as their business fundamentals and current market caps are not seen to match.

To enhance the possibility of an objective view of the space, this article provides an in-depth comparison of Chinese EV pioneers - NIO, XPeng and Li Auto - across several essential dimensions. A combination of comprehensive business research and technology analysis allows us to tailor an actionable message for investors with different styles and angles regarding these companies. It is a long, data-heavy read for those willing to learn as much as possible about the trio.

Core management

Like many other inspiring startup stories, EV brands face a long process before they can truly succeed. Persistence, creativity and agile thinking are all indispensable. Another key element is the makeup of a company's core team, where compatible, complementary mindsets are fundamental to success. We will start the article by introducing the three management teams and how their backgrounds have been affecting the companies' strategies.

NIO's management team was one of the earliest groups generating ideas for manufacturing NEVs in China. In the beginning phase, the company employed a number of talents who later moved on with XPeng and Li Auto. These include Li Auto's founder, who used to be a director at NextEV (NIO's original name). Moreover, to some extent, NIO is weighted towards management with finance backgrounds. The crew has

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EqualOcean is an investment research firm and information service provider focusing on China's Technology, Automotive and Consumer Internet sectors. With unique research and due diligence methodology, we provide tailored insights into a wide range of Chinese equities, empowering our clients' value-added decisions. Founded in 2014, EqualOcean is headquartered in Beijing and has offices in Shanghai, Shenzhen and New York.For more information, contact us at

Disclosure: I/we have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

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