As early as Jacob, the first Nephi’s brother, the Lamanites had been used as the presumed opposite of the Nephites. In all things, both civil and religious righteousness, the Nephites were presumed to be superior.
This Nephi echoes those same sentiments. The Nephites would naturally suppose themselves superior to the Lamanites, but Nephi tells them “it shall be better for the Lamanites than for you except ye shall repent. For behold, they are more righteous than you.” In Jacob’s case, it was an indication that the Nephites were so bad that even the Lamanites were considered better. Here, the Lamanites are better. This is the Nephi who had preached to them, and converted them.
One of the things that Mormon shows is that when Lamanites are truly converted, they could become even more righteous and faithful than the Nephites. That is exactly what Nephi is saying here. Invoking the promise of the land again, Nephi tells those gathered that they will be destroyed if they do not repent.