Xpeng trims net loss in first quarter as deliveries, margins increase and licensing fees from VW jump
- Net loss narrowed 41 per cent to 1.37 billion yuan (US$191.2 million) on higher deliveries, vehicle-sale margins
- The race to lead China’s EV market will get more intense from here amid price cuts, market analyst says
The firm incurred a 1.37 billion yuan (US$191.2 million) loss in the three months to March 31, versus 2.34 billion yuan in the same period last year, according to a Hong Kong stock exchange filing on Tuesday. Analysts who track the stock had forecast a 2.08 billion yuan loss.
Revenue at the Guangzhou-based EV maker surged 62 per cent to 6.55 billion yuan from a year earlier, aided by a 58 per cent jump in vehicle sales. The firm delivered 21,821 vehicles to its customers, a 20 per cent increase from a year ago, while per-vehicle margin rose to 5.5 per cent versus a negative 2.5 per cent previously.
“We are confident we can launch competitive models globally in a more efficient manner and thus spearhead the widespread adoption of AI-powered smart cars,” co-founder and CEO He Xiaopeng said in a statement. “Our industry-leading technologies are expected to gain greater market influence and yield better financial returns.”
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Why the EU, US are concerned about China’s overcapacity
The report came amid a bruising price war in the world’s biggest EV market, causing industry players to compete on price discounting to attract new customers. Concerns about overcapacity have caused jitters that carmakers in other markets will also slash prices. The US last week slapped punitive duties on Chinese EV exports to protect its market from cheaper imports.
Xpeng, known for its autonomous driving technology, offered a 20,000-yuan discount on its bestselling G6 sport-utility vehicle after deliveries fell to a three-year low. Price discounting had affected peers including Li Auto, which this week reported a poor set of results for the same quarter.
