Xpeng Ignites Share Surge with Affordable EV

In the bustling arena of electric vehicles (EVs), a shockwave was felt on Friday when shares of Xpeng, the Chinese EV manufacturer, skyrocketed more than 11%. The dramatic leap came after the company priced its latest innovation, the G6 sport utility vehicle, approximately 20% lower than Tesla’s Model Y in the Chinese market, reports Reuters.

This bold move arrives amidst speculations of Tesla setting a new sales record in China, the world’s largest EV market. However, the EV terrain in China isn’t solely Tesla’s playground. Chinese conglomerate BYD, supported by investor Warren Buffett, leads the charge. Yet, an analyst from China Merchants Bank International Securities predicts a potential 13% rise in Tesla’s sales over the forthcoming quarter.

Notably, China’s fondness for Tesla’s Model Y was evident in the first quarter, as it ranked as the top-selling vehicle globally during that period. However, Xpeng has placed its chips on the G6, hoping the SUV’s competitive pricing will rekindle its sales following a somewhat sluggish delivery performance in May.

Hanyang Wang, an analyst at 86Research Ltd, stated, “We believe that the G6 will become the best-selling model in Xpeng’s history.” With a starting price of 209,900 yuan ($28,882.01), Xpeng’s G6 undercuts Tesla’s Model Y, priced at 263,900 yuan, creating a distinctive niche in the EV market.

Citigroup analysts note, “We do admit the G6 pricing strategy created a unique product segment of BEV (battery electric vehicle) SUV at the 200,000-230,000 yuan range, which attracts customers wanting an entry-level mid-sized BEV SUV but cannot afford a Tesla Model-Y or Xpeng P7i.”

Expectations are brewing around 10,000 monthly unit sales of the SUV, with an anticipated boost from Beijing’s 520 billion yuan tax break for new energy vehicle purchases. In contrast, Tesla is preparing for a potential record of 445,000 vehicle deliveries worldwide from April to June, as predicted by nine analysts polled by Refinitiv.

With the launch of the G6, Wang predicts a possible price drop for Tesla’s Model Y, leading to a minor dent in Tesla’s vehicle margin in the latter half of this year. On the other hand, Xpeng’s competitive pricing strategy appears to be a rising tide that lifts all boats, as shares of fellow Chinese EV makers Li Auto and Nio rose 2.1% and 5.2%, respectively.

Haye Kesteloo
Haye Kesteloo

Haye Kesteloo is the Editor in Chief and Founder of EVXL.co, where he covers all electric vehicle-related news, covering brands such as Tesla, Ford, GM, BMW, Nissan and others. He fulfills a similar role at the drone news site DroneXL.co. Haye can be reached at haye @ evxl.co or @hayekesteloo.

Articles: 360

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