On August 18, Xiaopeng Motors released its second quarter 2023 earnings report。

Data show that the company's total revenue in the second quarter was 50.600 million yuan (RMB, the same below), slightly exceeding expectations 49.100 million yuan, down 31.9%, up 25.5%。Among them, automobile sales revenue was 44.200 million yuan, down 36.2%, up 25.9%。Services and other income of 6.400 million yuan, up 28.2%, up 22.8%。The increase was mainly due to an increase in sales of parts and services.。

Net loss in the second quarter was $2.8 billion, up 3.8%, up 19.7%。Gross profit was - $200 million, compared with 0 in the previous quarter..700 million yuan。Gross margin of -3.9%, compared with 1 in the previous quarter.7%。In the second quarter, Xiaopeng Motors' basic and diluted net loss per common share was 1.63 yuan。

R & D expenditure for the second quarter of 2023 was 13.700 million yuan, an increase of 8.1%, an increase of 5.5%。The increase was mainly due to the increase in expenses related to the expansion of the company's product portfolio and the development of new models.。

Xiaopeng's total vehicle deliveries in the second quarter of this year were 23,205, up 27 from 18,230 in the first quarter..3%。

For the outlook for the third quarter, Xiaopeng Motors expects that car deliveries will be between 39,000 and 41,000 units (ie, a monthly average of 1.300,000 to 1.between 360,000 vehicles), an increase of about 31.9% to 38.7%。In terms of total revenue, it is expected to be $8.5 billion to $9 billion, an increase of about 24% year-on-year..6% to 31.9%。

As of June 30, 2023, Xiaopeng Automobile's physical sales network totaled 411 stores, with a network of 1,024 self-operated charging stations (including 824 Xiaopeng Automobile self-operated super charging stations and 200 destination charging stations).。

          

When will the loss improve?？

           

Xiaopeng Motor's operating loss in the second quarter was 30.900 million yuan, both of which expanded year-on-year, up about 48% year-on-year and 19% month-on-month.。In terms of net loss, the company recorded a net loss of $2.8 billion in the second quarter, an increase of 3.8%, an increase of 19.7%。Net loss under non-GAAP was 26.700 million yuan, an increase of 8.3%, up nearly 20.7%

Gross profit went from positive to negative in the quarter, from 0 in the first quarter..700 million yuan turned into a gross loss of 200 million yuan, down 124 percent year-on-year..4%, plunging 394 month-on-month.5%。Gross margin also recorded a negative value of -3.9%, compared to 10.9%, compared with 1 in the previous quarter.7%。Among them, the gross margin of automobiles fell to -8..6%, compared to 9.1%, -2 in the previous quarter.5%, more than tripled from the previous year.。In response, the Company explained that the impairment of inventory and loss on inventory purchase commitments related to G3i had a 4.Negative impact of 5 percentage points。In addition, the increase in sales promotion and the expiration of the above-mentioned new energy vehicle subsidies are also the reasons for the decline in automobile gross margin.。

Expanded losses and declining gross margins to negative values have raised an "alarm" for Xiaopeng.。

During the call, Xiaopeng said that the company's current focus is very clear, that is, to obtain sales and scale effects, which will help improve gross margin。The company's current manufacturing costs were affected by some of the policy changes in the first quarter.。As production increases in the second and third quarters, the company's gross margin will climb and the company will sell a better product portfolio in the second half of the year, which is expected to gradually recover in the second half of the year and is expected to turn positive in the fourth quarter.。

In addition, Xiaopeng's cash flow is still shrinking, but fortunately the rate of contraction has slowed sharply。As of June 30, 2023, the Company had cash and cash equivalents, restricted cash, short-term investments and time deposits of 337.400 million yuan, 341 at the end of the previous quarter..200 million, compared with 382 at the end of last year..500 million yuan。

Xiaopeng, for its part, believes that with the increase in deliveries in the second half of the year, cash flow improved considerably in the second quarter, and the company will achieve an overall positive operating cash flow in the second half of the year and have a healthy size of cash reserves by the end of the year。

In addition, the company revealed that it will achieve an overall cost reduction target of 35% by the end of 2024 and exceed this target on multiple individual items.。

For the overall company's break-even and cash flow forecast, Xiaopeng Automobile said that by 2024, the company will achieve positive cash flow, for the overall operation to achieve break-even, the company believes that 2025 can be achieved, and the previous target is not much changed.。

               

How big is the G6 win?？

                

At the end of June this year, Xiaopeng's G6 super smart coupe SUV was officially launched in China. This model is based on Xiaopeng's new-generation technology architecture SEPA2.0's first model。G6 deliveries began in July。According to the company's official website, Xiaopeng currently has six models on sale, namely G6, G9, P7, P7i, P5, G3i。Among them, G6 delivered more than 3,900 vehicles in July, accounting for about 35% of the company's total delivery data in July.。

He Xiaopeng, chairman and CEO of Xiaopeng Motors, said on a conference call that the G6 is uniquely competitive on models priced at $200,000 to $300,000, so in terms of orders, the G6 will continue to maintain a strong level。

At the conference call, for the G6, Xiaopeng believes that the main challenge is that the Max version is not fully prepared with intelligent-related parts.。

In this regard, He Xiaopeng said that the company is working with suppliers to improve G6 production capacity, especially the Max version.。It is expected that the delivery volume of G6 models will be significantly improved in September this year, or it will drive the monthly delivery of Xiaopeng to exceed 1..50,000。The company will hit its G6 monthly delivery target of over 10,000 in the fourth quarter.。

He Xiaopeng also revealed that the next company will launch more explosive models based on the swing architecture.。With the rapid ramp up of G6 production capacity and the renewal of existing models, Xiaopeng will hit its monthly delivery target of 20,000 in the fourth quarter.。

With a monthly delivery target of 20,000, the ideal car was reached in March this year, and NIO also exceeded that target in July.。In contrast, Xiaopeng is expected to reach the fourth quarter, inevitably disappointing。

The "difficulty" of Xiaopeng's delivery data climb is closely related to its pricing.。Different from the "Wei Xiaoli" two other high-end market targeting more than 300,000 yuan, Xiaopeng's pricing is in the middle position.。At present, G6 has launched 5 versions, priced at 20.990,000 yuan - 27.Between 690,000。This price range faces more rivals in China's new energy vehicle market, such as Tesla's Model Y long-range version (now quoted 29.90,000 yuan), BYD's Han, Tang and Seal series are also roughly in the 200,000-300,000 yuan range.。In addition, there are models priced slightly below the G6 eyeing up. GAC Aean, Zero Run, Extreme Krypton and other brands have a number of models around 200,000。

It can be said that Xiaopeng is in the most intense price war "front"。Earlier this year, the round of price war has been seriously squeezed Xiaopeng's profit margins, and now, there are a number of new energy car companies to open a new round of price war。Since the beginning of this month, zero run, which, extremely krypton and other car companies have opened the price reduction mode, price cuts ranging from 1-3,70,000 yuan.。Last week, Tesla's price in China was "two drops in three days," with the Model Y long-life version and the high-performance version cut by 1.40,000 yuan。Weilai, SAIC Volkswagen and others also launched limited-time preferential activities in August.。

But this round of price war, Xiaopeng does not seem to intend to "fight"。Asked on the phone about the impact of this round of price wars, Xiaopeng Motors responded that competitors' price changes did not actually have much impact on the company's sales, especially on G6 sales.。He said: "Because we anticipated competitive pressure when we priced the G6, I think the measures we took were actually effective.。"

                 

He Xiaopeng: The era of AI defining cars has just begun

            

Xiaopeng Motors currently has its own intelligent driving system, including only navigation-assisted driving city NGP, intelligent assisted driving system XNGP and deep visual neural network XNET。

Xiaopeng's urban NGP was piloted in Guangzhou in September last year, making Xiaopeng the first car brand to allow high-end intelligent assisted driving to be mass-produced in urban scenarios.

Xiaopeng's XNGP plans to launch the main functions in the third quarter of 2023, the complete form will cover high-speed, urban, underground parking and other scenarios, seamless connection point-to-point travel needs.。

XNET is a new generation of perception architecture developed by Xiaopeng Automotive based on BEV + Transformer's XNGP technology and launched in the industry in October 2022.。

On the phone, He Xiaopeng said that the era of AI defining cars has just begun, and Xiaopeng will be the main driver of this wave.。He will personally lead the team of Big Intelligence to unify the planning of autonomous driving, autonomous cockpit, electronic and electrical architecture, and multiple intelligent innovation technologies.。

He Xiaopeng said that due to cost factors, no car company can launch a competitive fully autonomous vehicle at the 150,000 level.。But with the innovation of technology and the cost reduction of the whole process, his view has changed. Xiaopeng is confident that it will launch fully autonomous vehicles in the mainstream 150,000 class, which will greatly promote the full popularization of intelligence.。

He Xiaopeng stressed at the phone conference that XNGP will continue to make major breakthroughs in experience and coverage in the second half of this year, further promote the process of user recognition and use, and open the technology gap with followers.。At present, XNGP's map-free area capability is under intensive development, and it is expected to open urban NGP for 50 cities by the end of the year.。