Li Auto Inc. LI announced Friday it is recalling some of its Li ONE vehicle models, and the Chinese electric vehicle manufacturer's stock was retreating in reaction.
What Happened: Li Auto said that beginning Saturday it will start to replace free of charge the control arm ball joint in the front suspension on 10,469 Li ONEs produced on or before June 1.
The recall is in accordance with the requirements by China's State Administration for Market Regulation, the company said.
Li ONEs produced after June 1 are already equipped with an upgraded version of the control arm ball joint of the front suspension, Li said.
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Li One said the replacement plan is the same as the vehicle upgrade plan it proactively initiated and announced Nov. 1.
The replacement will be completed within three months, the company said.
"As a user-driven automotive and technology enterprise, Li Auto always puts its users as its highest priority, and will continue sparing no efforts to provide its users with safer, more convenient and more value-added products and services," Li Auto said.
Why It's Important: The Li ONE, a crossover SUV, is the company's only vehicle model and was made commercially available in November 2019.
In late October, the company said it completed deliveries of 20,000 Li ONEs.
Shares of Li Auto, which were listed on the Nasdaq in late July, began showing strong upward momentum this week. The recall news has served as a dampener.
LI Price Action: At last check, Li One shares were trading down 7.9% at $25.87.
Courtesy photo.
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