Gasgoo Munich- On June 13, NIO founder, chairman, and CEO William Li spoke at the 2026 China Chongqing Automotive Summit. During the closing plenary, he outlined four core characteristics of the Chinese automotive industry's new development stage.
Image Source: China Chongqing Automotive Summit
Li noted that the industry has entered the most brutal phase: the finals. Data from the China Passenger Car Association (CPCA) shows domestic retail sales slumped 19.5% year-on-year from January to May. Full-year retail sales volume is projected to fall 15% to 20%. The sector must prepare for a prolonged downturn. Meanwhile, the pure-electric market is hitting an inflection point. In May, the penetration rate of domestic pure electric vehicles hit 42.2%. This surpassed internal combustion engine vehicles for the first time. It increased 10.8 percentage points from a year ago. "This trend is irreversible, and it will only accelerate," Li emphasized.
Li argues the industry is shifting from a "period of brand chaos" to a "period of brand clarification." As products and technology in the new-energy era homogenize, the "chaos" of recent years is ending. Consumer brand preferences were blurred, but brand choice is now critical. Competition is evolving from "single-point battles" to "systemic warfare." The era where a single feature or a hit model guaranteed survival is over. Companies now need comprehensive capabilities. These include product definition, core technology, supply chain, cost control, manufacturing, sales, and service.
Regarding operations, Li outlined NIO's strategy. The company achieved profitability in Q4 of last year and Q1 of this year. This is notable given the industry-wide profit squeeze. He emphasized that sustainable profitability reflects full-chain operational capabilities. Sales volume is merely one metric. NIO has adopted a business unit concept of "spending where necessary and saving where possible." It maintains infrastructure investment while ensuring losses gradually narrow.
