Xpeng wants to become a global automaker

Electric vehicles gained popularity worldwide, and companies are trying to attract customers with new models. Chinese electric car start-up Xpeng is ready to enter new markets. It plans to become a global automaker, with half of the vehicle deliveries going to countries outside China. 

Its rival Tesla said in the third quarter that its home market accounted for 46.6% of total sales. The People’s Republic of China accounted for 22.6% of Tesla’s overall sales, up from just under 20% a year ago. Tesla opened its factory in Shanghai and began delivering locally made cars just before the onset of the pandemic in January 2020.

 The company from Guangzhou plans to invest more money in international markets this year. Furthermore, Xpeng is ready to invest more in 2022 as well. It expects to enter Sweden, Denmark, and the Netherlands next year.

 Xpeng’s rival Nio opened a flagship store in Oslo, Norway, and began local car deliveries in September. Electric vehicles are quite popular in Norway. Companies from China are selling their electric vehicles to local customers. This summer, BYD, backed by U.S. billionaire Warren Buffett, began shipping electric vehicles to Norway. BYD wants to deliver 1,500 cars there by the end of 2021. This month, the company launched deliveries to the Dominican Republic, following a similar expansion to Mexico, Colombia, Uruguay, Costa Rica, Brazil, and the Bahamas in October. 

Xpeng and main findings

U.S.-listed Xpeng’s shares jumped 8% on Monday after Xpeng reported a beat revenue in the third quarter, coming in at 5.72 billion yuan ($887.7 million). Still, the company reported a greater-than-expected loss of 1.77 yuan (27 cents) per share. Xpeng’s vice president and chairman Brian Gu think that the automaker can reach breakeven in two years.

 In 2019, before Covid-19, as well as the ensuing chip shortage, he expected to reach breakeven in about two or three years, but with one precondition. Xpeng had to produce 150,000 cars a year. In October, the company said it produced a total of just over 100,000 cars since its founding six years ago. 

Xpeng launched its first commercially available vehicle, the G3 SUV, in December 2018. According to Brian GuIts, the G7 sedan is more popular and accounts for more than 77% of deliveries.

 Guangzhou-based Xpeng began delivering a third electric model, the P5 sedan, in October. Last week, it presented a new electric SUV, the G9. Xpeng designed G9 for the local as well as international markets.