Xpeng Prices New EV Aggressively Amid Competition Vs. Tesla, Nio

Xpeng Prices New EV Aggressively Amid Competition Vs. Tesla, Nio

Xpeng Prices New EV Aggressively Amid Competition Vs. Tesla, Nio

China’s Xpeng Motors (XPEV) announced aggressive pricing for its new lidar-enabled autonomous electric sedan as competition with Nio (NIO) and Tesla (TSLA) intensifies in the world’s biggest car market. Xpeng stock turned higher.


Xpeng priced versions of its new P5 EV from 160,000 yuan ($24,700) to 230,000 yuan after subsidies, to attract price-sensitive Chinese buyers. That would imply Xpeng’s pricing undercuts Tesla’s Model Y SUV in China, which now starts at 276,000 yuan after subsidies and a price cut.

Base versions of the P5 don’t include lidar sensors, which use pulsed laser beams to help highly automated cars avoid collisions. But the initial “enthusiastic response” from car buyers comprised mostly orders for high-end, lidar-equipped models, Xpeng said in a release Monday.

According to Deutsche Bank analysts, the Xpeng P5 scored more than 5,000 orders in the first seven hours of pre-sales. And 70% of customers chose P5 models with lidar technology built in. On Monday, the firm raised its price target on Xpeng stock by 7 to 50, while maintaining a buy rating.

Deutsche Bank’s Edison Yu raised his full-year sales estimate for Xpeng by 5,000 units to 75,000 units, which assumes higher deliveries of the existing P7 and the new P5 EVs.

Deliveries of the P5 start in the fourth quarter of 2021.

Tesla’s emerging rival in China unveiled the P5, a smaller version of the P7 electric sedan, in April. Xpeng also sells the G3 compact electric SUV.

Xpeng describes the P5 as the world’s first lidar-equipped electric car. It touts an autonomous driving system enabled by 32 sensors, including two lidar units and 13 high-definition cameras. And the P5 will bring autonomous driving from highways to city roads for the first time, Xpeng said.

That system is Level 3, meaning highly autonomous driving allowing drivers to hand over complete control to the car under certain conditions.

Earlier in July, Tesla unveiled a cheaper version of its Model Y SUV in China, where it faces fiercely rising competition from EV startups. It priced the Model Y at 276,000 yuan after subsidies, making it cheaper than its direct competitor, Nio’s ES6 SUV.

Meanwhile, Nio plans to introduce the ET7, its own autonomous EV enabled with lidar sensors, early next year.

IBD Live: A New Tool For Daily Stock Market Analysis

Xpeng Stock

Shares erased earlier losses to rise 1.8% to 39.72 on the stock market today. Xpeng stock has pulled back to the 10-week line and remains well off the 52-week high, but has never traded below its IPO price of 15 since its August 2020 debut.

Among other EV stocks Nio stock also reversed higher to rally 1.3%. Tesla, which launched subscriptions last week for its “FSD” driver-assistance system, inched up 0.3% after falling 4%.

Meanwhile, Nio and Li Auto (LI) are considering a listing on Hong Kong’s stock market, where Xpeng debuted earlier this month in a dual listing, local media said.

Li Auto stock edged up 0.8% after selling off 5%.

Find Aparna Narayanan on Twitter at @IBD_Aparna.


These Are The 5 Best Stocks To Buy And Watch Now

The Next Supply Crunch Could Be Even Worse For Car Stocks

While Tesla Soars, Electric Cars Face A Huge Test

Stocks To Watch: Top-Rated IPOs, Big Caps And Growth Stocks

Find The Latest Stocks Hitting Buy Zones With MarketSmith