Company: LI
Filing Date: 2025-04-10
Form Type: 20-F
Source: 0001410578-25-000678
Chunk: 34

Company: Li Auto Inc.
Filing Date: 2025-04-10
Form: 20-F
Item: Item 3
Chunk 34
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 to 45.3% in October 2024. These countervailing duties may be extended for successive five-year periods following an expiry review. The European Union anti-subsidy investigations, the resulting tariffs, and other similar investigations and tariffs in international markets may adversely affect the imports of BEVs from China, such as ours, into international markets and negatively affect our competitiveness if we decide to enter into the EU market.
Similar tariffs or other trade policies that negatively affect us in other jurisdictions may have a negative impact on us in a similar way. In the U.S. market, on January 14, 2025, the U.S. Department of Commerce’s Bureau of Industry and Security announced a final rule prohibiting certain transactions involving the sale or import of connected vehicles. In addition, in September 2024, the office of the U.S. Trade Representative increased the tariffs for Chinese EVs from 25% to 100%. In April 2025, President Trump imposed 10% tariff on all countries and individualized higher tariff rates on a large number of countries, including a 34% additional tariff on China which was later increased by another 50% in response to China’s imposition of additional tariff against the United States. The increased tariffs further impose additional challenges and constraints on any future international expansion to the United States we may undertake, although we do not currently sell vehicles in the United States.

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New geographic markets may have competitive conditions, user preferences, and discretionary spending patterns that are more difficult to predict or satisfy than our existing markets. In certain markets, we have relatively little operating experience and may not benefit from any first-to-market advantages or otherwise succeed. We also may face protectionist policies that could, among other things, hinder our ability to execute our business strategies and place us at a competitive disadvantage relative to domestic companies. Local companies may have a substantial competitive advantage because of their greater understanding of, and focus on, the local users, as well as their more established local brand names, requiring us to build brand awareness in that market through greater investments in advertising and promotional activities. International expansion may also require significant capital investment, which could strain our resources and adversely impact current performance, while adding complexity to our current operations. We are subject to the laws and regulations of the jurisdictions in which we operate. If any of our overseas operations, or our affiliates or agents, violate such laws, we could become subject to sanctions or other penalties, which could adversely affect our reputation, business, financial condition, and results of operations.
In addition