Shares of Chinese electric vehicle maker LI AUTO soared 5.05% on Tuesday, as the company's extended-range hybrid and lithium-iron-phosphate (LFP) battery technology seem to be gaining traction in the rapidly evolving EV market.

According to industry analysts, the adoption of hybrid and plug-in hybrid vehicles, which combine a traditional internal combustion engine with an electric battery, has outpaced pure battery electric vehicles (BEVs) in recent months. This trend is particularly pronounced in China, where extended-range hybrids, known as EREVs, now account for nearly a third of all plug-in hybrid sales.

Automakers are embracing hybrids as a relatively low-cost transition technology between gasoline and pure electric vehicles. These vehicles require smaller battery packs, reducing the demand for metals like lithium, nickel, and cobalt, which are crucial for traditional EV batteries.