Xpeng’s second half of 2022 slows down compared to the start

Xpeng has presented its business figures for Q3 2022. The Chinese electric car maker’s vehicle deliveries and sales were weaker than in the Q2 2022, and the company’s October figures and forecasts point to an even more critical fourth quarter.

Xpeng delivered 29,570 vehicles in July-September, down 4,852 from the second quarter of 2022 but up 15 per cent from the same period last year. Total revenue in the third quarter of 2022 was 6.82 billion yuan (about 920 million euros), up 19.3 per cent year-on-year and down 8.2 per cent from the second quarter of 2022. The Chinese manufacturer’s net loss for the period was 2.38 billion yuan (about 320 million euros), compared with 1.59 billion yuan in the same period of 2021 and 2.7 billion yuan in the second quarter of 2022.

The larger P7 sedan accounted for 16,776 of the 29,570 deliveries – just over half. The smaller, but technically more advanced sedan P5 came to 8,703 sales – significantly less than the 12,848 vehicles of this type indicated for Q2. The company no longer reports deliveries of the other models separately.

The figures for October are also sobering: Total deliveries for the month amounted to only 5,101 vehicles – including 2,104 P7s, 1,665 P5s, 703 G3is and 623 units of the new flagship G9. The forecast for the fourth quarter is correspondingly low: Xpeng expects 20,000 to 21,000 vehicle sales, a slump of around 50 per cent compared to Q4 2021, while sales are likely to melt down to 4.8 to 5.1 billion yuan (a good -40 per cent compared to Q4 2021), according to the company’s estimates.

Xpeng justifies the forecast by citing “current market conditions”, including covid outbreaks in China and capacity constraints. According to CEO and chairman He Xiaopeng, his management team is already taking countermeasures: They recently conducted a thorough review of growth strategy, products and operations, he said. “We have already carried out organization restructuring and changed some of our strategies. I am confident that our industry-leading smart and electrification technologies will allow us to build competitive products appealing to a broad customer base.”

According to Hongdi Brian Gu, Honorary Vice Chairman and President of Xpeng, “prudent cost control initiatives and improve operational efficiency” are planned. And, “As we plan a number of upcoming product and technology rollouts, we are confident that we can achieve significant improvement in both sales volumes and average selling price.”

Meanwhile, the manufacturer’s physical distribution network has continued to grow. As of 30 September 2022, Xpeng operated 407 shops in 143 cities. Its own charging network grew to 1,011 stations, including 806 fast chargers and 205 destination chargers.

In a conference call for analysts afterwards, the company suggested that after a weak November with around 5,800 deliveries, sales levels should pick up to around 10,000 units in December. Xpeng also said it would launch a facelift of the P7 sedan and a B-segment electric SUV in the price range of 200,000 to 300,000 yuan (about 27,000 to 40,000 euros) in the first half of next year.

ir.xiaopeng.com, cnevpost.com (Earnings Call)