Xpeng opened its first showroom in Sweden earlier this year
The Chinese Tesla rival made a promising start in Norway but that does not guarantee Continental success
Amid the slew of Chinese electric car start-ups that have launched in recent years, Xpeng has undeniably emerged as one of the most interesting.
The company, based in the southern megacity of Guangzhou, has caused quite a stir with bullish sales predictions, some genuinely interesting breakthrough tech on the road and, in the air, the evolution of its frankly remarkable ‘flying cars’.
It’s an obvious characterisation to paint it as ‘China’s Tesla‘ but Elon Musk must surely admire Xpeng’s ability to capture headlines in its domestic market, and it certainly made many in the West sit up and take notice when vice chairman and president Brian Gu said in early September: “Most of our future sales will come from international markets, maybe half.”
At the same time, the company has been undergoing something of a bumpy period, with sales in China declining by almost 50% year on year in October to 5101 – the third consecutive month it had registered a tally of under 10,000. At the time of writing, a restructure at executive level was being finalised, according to reports in the Chinese media, while there has also been a dramatic drop in stock value – around 80% year on year.
However, this turbulence hasn’t dented its international ambitions. Even though Chinese brands have no legacy in Europe, the brand is confident it can convince buyers here. “While it may be challenging, it is not impossible,” a spokesperson for Xpeng told Autocar Business, citing an award – as most recognised new brand – that it has already picked up in a Kantar car index survey in Norway, a mature EV market, as a sign of tangible progress. “[This] bodes well for the rest of our European expansion.”
She continued: “Great opportunities abound in Europe over the next few years, buoyed by consumers’ rising demand and government incentives. We have successfully opened our brand experience stores in Oslo, Copenhagen, Stockholm and Amsterdam, and our teams, including marketing, sales, after-sales, and customer services have all been [put] in place.
“And yes, Xpeng has plans to come to the United Kingdom soon, as part of our long-term commitment to accelerating the electrification process in Europe.”
Nevertheless, it’s entirely reasonable to look at recent events – particularly the disappointing sales figures in China – and wonder if the confidence is wholly justified. In particular, a slow start for its luxurious G9, hailed as the “world’s fastest-charging” electric SUV, seems to have caused some of the internal ructions.
Xpeng believes specific factors are to blame. “The market has not fully recovered from the Covid-affected economy,” Autocar Business was told. “The Chinese EV market is the most competitive in the world. Xpeng has new models just arriving that may have weakened interest a bit in current models, and… we expect the new G9 SUV to spur growth after a challenging period.
“With the G9, we start launching new products in the next few quarters, probably at least one product per quarter, and that is going to be the main catalyst for our new growth.” An all-new B-segment contender – thought to be a coupé-SUV that will rival the Tesla Model Y – and C-segment model are promised for 2023.
However, while the company is happy to reveal some of its product plan, it is less forthcoming on the share price, saying it is unable to comment before its third quarter earnings announcement on 30 November. This is being awaited by many industry observers with interest. Previously, it had projected third quarter revenue in the area of RMB 6.8 billion (around £810 million) to RMB 7.2bn (£858m) – which would constitute a year-in-yaer rise of 18.9% to 25.9%.
Apart from its ability to generate publicity, one factor that has marked out Xpeng from some of China’s other EV start-ups is its particularly enthusiastic development of cutting-edge driver assistance tech. One example of this is City Navigation Guided Pilot (City NGP) – tested virtually by Autocar on the P5 saloon. Essentially an autonomous driving system that takes the strain out of urban driving, it is currently only available in Guangzhou due to the fact that mapping is such a laborious process. But Xpeng has real belief in its potential globally. “Eventually, we hope it will be a big selling point for us wherever we operate,” we were told.
Add to that the standard integration of lidar on the G9 and Xpeng’s ongoing in-house development of autonomous software and hardware solutions, and it’s clear that the company sees this area as a real USP, pledging that it is “committed to optimising the user experience of driver assistance autonomous driving, in all sales areas.” In an industry clearly uncertain about many aspects of self-driving tech, as witnessed by Volkswagen and Ford recently pulling the plug on Argo AI, it’s a bold strategy.
Bolder still is the company’s pursuit of so-called ‘flying cars’, which recently resulted in aviation subsidiary AeroHT staging a test flight of the outrageous X3 prototype – a 1936kg sports car fitted with four twin rotors that is, apparently, capable of both being driven and flown, and is destined for mass production.
A spokesperson told Autocar: “Our ultimate aim for flying cars is for them to be used as people’s day-to-day mode of transport, as well as handle low-altitude city flights such as sightseeing and medical transportation. Where we sell them will depend on who develops legislation quickly enough.”
As unlikely as the idea of two-tonne vehicles patrolling our skies sounds, it’s impossible to ignore the fact that Xpeng AeroHT recently secured a credit line of RMB 6bn (£715m) to support its R&D in flying cars.
However the Xpeng story evolves, then, both at home and further afield, don’t expect there to be too many dull moments, as the company has an undoubted ability to command attention. Maybe those Tesla comparisons are valid after all.
The Tesla factor
While Xpeng acknowledges that Nio, Li Auto and BYD are its chief rivals from China, it’s obvious that Tesla is the company it has in its sights. And it’s not been shy in saying so.
Sales wise, though, it has some catching up to do. In China, in September – the last month that market retail figures are available for – Tesla ranked sixth with 76,882 sales. Xpeng was 37th, with 8416.
Like Elon Musk, CEO He Xiaopeng is a vocal advocate of his company’s tech – and he’s also aware of comparisons between the two and their companies.
“Elon Musk is now better than me, but I might be better in the future,” he was quoted as saying in an interview at CES in 2018.
When asked by Autocar about the rivalry with Tesla, the brand was predictably forthright. “Xpeng greatly admires Tesla’s innovations within the EV industry, [but] we believe Xpeng has a particular advantage over Tesla in autonomous driving – especially in China, where, thanks to our City NGP, we can tackle much more complex road conditions than any other mass-produced vehicle, including all of Tesla’s.”
In an industry where corporate tongues often remain bitten, it’s another demonstration of Xpeng’s maverick spirit.