XPeng wants to "grab food" from BYD's mouth

Author | Wang Xiaojuan

Editor | Zhou Zhiyu

NVIDIA CEO Jensen Huang, Alibaba Chairman Joseph Tsai sent video congratulations, Xiaomi founder Lei Jun personally attended the event, a press conference gathered top leaders, XPeng was quite impressive this time.

It's no wonder that XPeng Motors Chairman He Xiaopeng attaches so much importance to it. While celebrating XPeng's tenth anniversary, he is launching the XPeng MONA M03 model. He has high hopes for this model, believing it will be the "key to turning the tide" for XPeng Motors in the second half of the year.

So much so that He Xiaopeng is somewhat at a loss on how to price the MONA M03, revealing that internal discussions on pricing were still ongoing on the morning of the 27th before the press conference.

In the end, the MONA M03 turned out to be somewhat unexpected for the market. For this launch, the MONA M03 only offers three SKUs, with prices lower than the previously disclosed not exceeding 139,800 yuan.

Among them, there are two versions with basic intelligent driving functions, priced at 119,800 yuan for a range of 515 kilometers and 129,800 yuan for a range of 620 kilometers. These two versions will officially start deliveries in September.

In addition, the Max version with advanced intelligent driving functions is priced at 155,800 yuan, with a range of 580 kilometers, and will officially start deliveries after the 2025 Spring Festival.

At 155,800 yuan, close to $20,000, this is the price that Tesla's Model 2, which has been delayed, has been aiming for.

During the debut of the MONA M03, He Xiaopeng once said that the naming as M03 is mainly to pay tribute to Tesla's Model 3. But putting end-to-end advanced intelligent driving into a car priced at $20,000, Musk has not yet achieved it, while He Xiaopeng has done it first.

This car is quite resilient in the market. Soon, the latest orders proved its competitiveness - 52 minutes after the end of the press conference, XPeng MONA M03 received 10,000 orders.

XPeng has also made sufficient preparations for deliveries, hoping to bring XPeng's sales to new heights.

This is already reflected in XPeng's financial report regarding the sales guidance for the next quarter - XPeng's total deliveries in the third quarter will range from 41,000 units to 45,000 units, an increase of 36% to 49% compared to the previous quarter.

For XPeng, the XPeng MONA M03 needs to be a big hit. If the pricing is not competitive, then He Xiaopeng's wish to turn things around in the second half of the year will be difficult to achieve; and with competitive pricing, whether it can win the favor of A-class car market users with its intelligent driving capabilities, it still needs to cultivate the market's mindset towards intelligent driving.

After all, in the price range where the XPeng MONA M03 is positioned, the main competitors are models with high cost performance such as the BYD Qin, and the users in this market are more concerned about the durability of the product, seeking the performance, space, handling, and range that can be enjoyed at this price range. As for intelligent driving, it is not a priority for these market users.

Therefore, whether the XPeng MONA M03 can become XPeng's sales champion, leading XPeng out of low sales, still requires more positive market feedback.

However, XPeng has made sufficient preparations for the delivery of this car to avoid a repeat of last year's XPeng G6 incident In addition, Xiaopeng has significantly strengthened the marketing of the MONA M03 listing this time.

Not only did they invite a group of big shots from the automotive and internet circles to record videos to support Xiaopeng, but Lei Jun also visited Xiaopeng directly and went for a ride with He Xiaopeng. Wave after wave of preheating activities made it to the top of the hot search list.

The market can clearly feel the popularity of Xiaopeng's MONA M03, then pay attention to its price, and consider making a purchase, which is a normal path to generate interest.

The Xiaopeng MONA M03 is carrying Xiaopeng's latest changes and opening up Xiaopeng's next 10 years.

Moreover, for Xiaopeng, how to extend the sales cycle of a model and make a popular model a consistently selling model is also a question that Xiaopeng needs to consider. Previously, models like the G6 have also received good market recognition, but the duration of success was not long.

In the new 10 years, industry challenges remain huge.

He Xiaopeng predicts that in the next 10 years, perhaps only 7 mainstream Chinese automotive brands will remain; and in the next 10 years, selling 1 million units of AI cars annually will be the ticket to the finals.

Based on this prediction, Xiaopeng has also adjusted its internal strategy, such as focusing more on going global. He Xiaopeng stated that he hopes that half of Xiaopeng's sales in the next 10 years will come from overseas.

In the next 10 years, Xiaopeng will also join industry players in the fierce battle of the second half of intelligence, vying for a seat at the table of the future seven giants.

Following the end of the press conference, here is a transcript of the dialogue between He Xiaopeng, Chairman of Xiaopeng Motors, Li Liyun, Head of Xiaopeng Smart Driving, and Yang Guang, Product Manager of Xiaopeng MONA series (edited without changing the original meaning):

Question: Today, the listing price of Xiaopeng MONA M03 is indeed very competitive. Will such a price bring pressure on costs and profits?

He Xiaopeng: First, Xiaopeng Motors' pricing strategy must ultimately achieve reasonable profits, which is the foundation of everything.

Second, in the current market environment, user demands are crucial. Therefore, when setting prices, we prioritize how to give back to the majority of car owners. Through a lot of technological innovations, we have successfully controlled costs.

As I mentioned earlier, we have done a lot of work on the energy management of the whole vehicle, which allows us to achieve longer range with fewer batteries, resulting in lower costs.

I have said before that to make a car excellent in product performance, affordable in purchase cost, and definitely profitable.

Question: The Xiaopeng MONA series this time particularly emphasizes the issue of delivery guarantee. What specific measures have been taken to ensure delivery?

He Xiaopeng: There are many things done to ensure delivery, such as in the supply chain, ensuring the quantity and quality of all partners are okay. Secondly, the quality of design, research and development, manufacturing, and overall service all provide delivery guarantees.

We have designed a total of 3 types of SKUs, with the main difference being range, one is 620 kilometers, one is 515 kilometers, and everything else is the same. All these designs are to make delivery easier. After users place orders, the main differences are in color and range, so production is very simple Question: Mr. Yang Guang, Mr. Xiaopeng mentioned that Xiaopeng MONA M03 is the first car of the new decade and is very important. Have you made any preparations for this? Do you have any goals, and how do you plan to achieve them?

Yang Guang: Whether it's product research and development, market launch, public opinion maintenance, or subsequent production, sales, and services, we have made sufficient preparations. Our goal is to achieve monthly sales of over ten thousand or even higher. The development of subsequent products is also in full swing, and we are well prepared.

Question: There is an industry consensus that smart driving will go through stages from being usable to being good to being loved. Currently, Xiaopeng Motors has reached the level of being good. When do you think it will reach the stage of being loved, or when will the entire industry reach this stage?

Li Liyun: The transition from being good to being loved is actually very simple, it's all about end-to-end AI large models.

Let me share some data. After the latest Xiaopeng AI Tianji 5.2.0 system was launched, several core indicators, including penetration rates of mileage, trips, and users, clearly show that the end-to-end large model has improved the smoothness of Xiaopeng MONA M03 software by more than 20%. Previously challenging areas such as narrow roads, U-turns, and roundabouts that were handled with rules have seen a significant improvement in processing capabilities. Both user surveys and the data feedback we received clearly show this.

Therefore, there is a consensus that the transition from usable to good to loved in smart driving experience is an inevitable path. Everyone can continue to pay attention to our new versions, as under the empowerment of end-to-end large models, we will provide users with a better door-to-door XNGP experience.

Question: Since navigation functions can be achieved without LiDAR, will Xiaopeng Motors remove LiDAR from other models? What are the differences between models with LiDAR and those without LiDAR in the future?

Li Liyun: The core advantage of the end-to-end large model is the reduced reliance on LiDAR and the emphasis on the overall integration of information. Therefore, whether it's a model with or without LiDAR, we have two sets of hardware and software that are synchronously updated and iterated. Whether in urban areas, highways, or "door-to-door" intelligent assisted driving, we can provide users with the best experience.

With the continuous advancement of technology, I believe that in the pursuit of L4 level autonomous driving models, LiDAR still plays an indispensable role, as its high-precision detection capabilities provide important guarantees for safe driving in complex scenarios.

However, in daily urban driving scenarios, although active sensors can indeed enhance safety, they are not a necessary condition for achieving urban navigation functions.

He Xiaopeng: We are about to launch the all-new Xiaopeng P7+ model, which will adopt a design strategy without LiDAR or light LiDAR. At the same time, in the future model replacement process, we will gradually follow this concept.

Question: To what extent does the technical reserve need to reach to support the achievement of an end-to-end model?

He Xiaopeng: Originally, it was about the level of intelligent driving cars at 150,000 yuan, which no one could achieve because not only do you have to develop the functions, but you also have to bring down the price. So, I am quite happy that we have achieved what we couldn't do three years ago today Li Liyun: The end-to-end threshold is not a price threshold. End-to-end will change the iterative way or behavior mode of intelligence, the paradigm of R&D. In the era of traditional rules, designing an algorithm, establishing a model, and making some adjustments as a team can quickly take effect.

But it's a bit like treating a headache with a headache and treating a foot pain with a foot pain. In other words, if perception is not good, then improve the perception model; if planning is not good, then design some algorithms for the scenario. However, in today's era where users can fully experience high-level intelligent driving capabilities, and it is becoming easier to drive nationwide, the requirements are already different.

End-to-end will make the entire chain longer. We invest 3.5 billion yuan in AI expenses every year, whether it is in terms of computing power construction or, more importantly, data collection, it requires a lot of accumulation and time.

He Xiaopeng: Let me give you an example. In the past, Tier 1 of autonomous driving wrote rules, and it could put a rule in different cars, make some modifications, and use it. In other words, the lower limit of Tier 1 is relatively high, and the upper limit is relatively low. But in an end-to-end system, the upper limit is very high, and if the lower limit is not done well, it is also very low.

In such a system, once end-to-end becomes more mature in the future, taking XPeng as an example, by the end of this year to next year, it will become increasingly difficult for Tier 1 to provide rule methodologies for autonomous driving to partners, which will push more and more manufacturers to self-develop or deeply self-develop this system.

Question: If you consider the past ten years as a journey of entrepreneurship, do you think you have achieved the goals of these ten years? What are your goals for the next ten years?

He Xiaopeng: In the past ten years, I have created smart electric vehicles, whether selling 10,000 units or 100,000 units, each is a goal continuously broken down. In the next ten years, I want to do well in AI cars.

In the future, I think vehicles in cities should be autonomous, vehicles between cities should be low-altitude flying, and short-distance transportation and service tools in the future should be robots. Achieving these three visions may take more than ten years, perhaps it can be achieved in the next decade