Many young Chinese electric vehicle manufacturers have found themselves hostage to the price wars that broke out in the market last year. Meanwhile, the situation has begun to improve in this regard, as demonstrated by the quarterly reporting of XPeng, which increased revenue by 60% and maintained a positive profit margin for the fourth quarter in a row.
Image source: Xpeng
In any case, as the South China Morning Post explains, at the end of the second quarter, XPeng still received net losses in the amount of $179.2 million, but their value at least sequentially decreased by 6.6%, and in annual comparison by 54 %. Moreover, in this regard, the company performed better than analysts’ expectations. The company’s revenue grew 60% year-on-year to $1.1 billion, and up 24% on a sequential basis. The company’s profit margin has been growing for four consecutive quarters, last year reaching a respectable 14% for the industry. However, in the electric vehicle industry itself, XPeng’s profit margin in the second quarter did not exceed 6.4%.
Specifically, the sale of electric vehicles brought the company $956 million in revenue in the last quarter, which is 54% more than the results of the same period last year, and 23% more than in the first quarter of this year. Revenue was mainly increased due to the growth in the supply of electric vehicles, as explained by XPeng management. During the second quarter, the company shipped 30,207 vehicles, which is 30% more than last year’s result.
It is noteworthy that in the current quarter, XPeng expects to sequentially increase deliveries of electric vehicles by almost one and a half times to 45,000 cars, if we take the upper limit of the range. The pessimistic scenario implies the shipment of 41,000 electric vehicles by the end of the current quarter; the annual growth rate will range from 2.5 to 12.5%. The company’s third-quarter revenue could rise 14.9% year over year to $1.37 billion, according to management. By the end of July, the company was able to launch its X NGP autopilot system throughout China, becoming the first automaker to achieve such coverage.