(Yicai) May 17 -- After US investors filed a class action lawsuit against Li Auto for allegedly exaggerating demand, the Chinese new energy vehicle startup replied that the accusations are groundless.

Li Auto will spare no effort to safeguard the rights and interests of the company and its shareholders, the Beijing-based carmaker said yesterday.

On May 14, Rosen Law Firm announced the filing of a class action lawsuit on behalf of purchasers of securities of Li Auto between Feb. 26 and March 20.

According to the lawsuit, Li Auto made false and/or misleading statements and/or failed to disclose that the firm had overstated the demand for its vehicles and the efficacy of its operating strategy in launching the Li Mega, therefore it was unlikely to meet its first-quarter delivery target. If the correct information had been released, they would have likely had a material impact on Li Auto’s financial condition.

During the earnings conference call on Feb. 26, Li Auto predicted it would have delivered between 100,000 and 103,0000 units in the first quarter of the year, up 90 percent to 96 percent from a year earlier. 

On March 1, Li Auto launched its first pure electric model Li Mega multi-purpose vehicle, priced at CNY559,800 (USD77,465). Li Auto’s Chief Executive Officer Li Xiang said he was confident the Li Mega would have become the best-seller among passenger vehicles priced above CNY500,000. 

But on March 21, Li Auto announced it had adjusted the target to between 76,000 and 78,000 units due to sales orders falling short of expectations. It also said that the downgraded outlook was linked to the launch of the Li Mega, as the model’s operating strategy was misplaced.

Li Auto [HKG: 2015] was trading down 4.1 percent at HKD95.65 (USD12.26) as of lunch break in Hong Kong today. The company’s US-listed shares [NASDAQ: LI] closed 2.7 percent down at USD25.21 yesterday.

Between Feb. 26 and March 20, Li Auto’s stocks in the US and Hong Kong slumped around 30 percent.

Editor: Futura Costaglione