Author: Xiaodong Xu

Editor: Chris

Hong Kong Stock Exchange Approves XPeng’s Listing Application

On June 23, according to Bloomberg, the Hong Kong Stock Exchange has approved XPeng’s listing application in Hong Kong. On the HKEX website, it shows that XPeng has passed the hearing process, which means XPeng is likely to become the first new automobile company to be listed in Hong Kong.

XPeng’s Hong Kong IPO is a “dual-primary listing” and is the first dual-primary listing of major U.S.-listed Chinese concept stocks in Hong Kong within three years. Previously, three new automobile companies had planned to go public in Hong Kong, but now it seems that XPeng has taken the lead.

XPeng has also revealed a lot of important information in its prospectus this time.

“XPeng’s Fourth Model”

XPeng reiterated in its prospectus that it will focus on the mid- to high-end Chinese passenger car market, where the price is between CNY 15 million and 30 million.

XPeng’s product lineup is becoming more diverse, from the G3 delivered from December 2018 to the soon-to-be-revised G3i, the P7 delivered from May 2020, and the P7 Wing Limited Edition developed thereafter. In April of this year, XPeng also released its first production car equipped with a solid-state LiDAR, the XPeng P5.

Currently, XPeng’s product lineup lacks a mid- to high-end large SUV. In its prospectus, XPeng disclosed that it plans to launch its fourth intelligent electric vehicle model, a mid- to high-end SUV model, in 2022. The new model will be equipped with advanced self-driving systems and solid-state LiDAR, Available with XPILOT 4.0, it will also be equipped with an enhanced core vehicle system that provides fast charging capability, a more comprehensive domain control unit, stronger OTA capability, and intelligent suspension and air suspension systems.

According to the following figure, we can see that the fourth model should be a mid- to high-end SUV, with a price between the XPeng P7 and the P7 Wing Limited Edition, i.e. between CNY 229,900 and 409,900.

XPeng’s fourth intelligent electric vehicle will use the same platform as the P7, namely the Edward platform, which also means that the wheelbase will be between 2,800 mm and 3,100 mm. In addition to the David and Edward platforms, XPeng has also begun developing a new platform for expanding its product portfolio and meeting the needs of more Chinese consumers.

“Full-Stack Self-Development”

XPeng’s investment in intelligence has been increasing continuously. In the first quarter of 2021, XPeng’s R&D expense reached CNY 535.1 million.In January 2021, XPeng officially launched the NGP feature of XPILOT 3.0, the highway pilot semi-autonomous driving assist function. At present, NGP has implemented functions such as automatic lane changing, overtaking, recognition of traffic signs and construction signs, and keeping a safe distance from large trucks.

As of March 2021, more than 20% of XPeng P7 users have activated XPILOT 3.0, accumulating more than 2.3 million kilometers of usage. In June of this year, XPeng also launched the VPA function for parking memory, and Class Star Channel participated in the experience event. XPeng’s product logic for point-to-point autonomous driving is accelerating its landing.

The newly launched XPeng P5 is equipped with a laser radar, and XPILOT 3.5 will support NGP on major urban roads. In its prospectus, XPeng also demonstrated its proprietary algorithm, which combines positioning and high-precision map fusion to achieve accuracy within a few centimeters, enhancing the autonomous driving capability, and providing a simulated environment display function.

In terms of perception algorithms and sensor fusion, XPeng XPILOT adopts deep learning neural network technology, which can complete complex visual tasks, including identifying various objects in various driving scenes through continuous algorithm training data.

As of March 31, 2021, XPeng’s autonomous driving dataset includes approximately 5.9 million annotated images for algorithm training. Meanwhile, XPeng has established algorithm development and comprehensive model capabilities for behavioral planning. The closed-loop data processing capability enables XPeng to make faster progress in autonomous driving solutions.

In terms of the Xmart OS car operating system, XPeng’s voice assistant can support continuous dialogue and can receive and execute ten requests within 25 seconds. From 2019 to Q1 2021, XPeng’s assistant usage rate reached 99%. In June of this year, XPeng also launched the voice control lane change function. In terms of navigation, XPeng has built a custom navigation system based on the Gaode engine, which can better integrate with autonomous driving functions. XPeng also provides digital car keys, third-party applications, intelligent recommendations, and remote control functions.

XPeng’s core advantage is its fully self-developed technology, which enables it to better and faster develop autonomous driving and intelligent cockpit areas to be more compliant with user requirements.

Regarding news that XPeng Automotive’s Hong Kong IPO plans to raise $2 billion, a relevant person in charge of XPeng said no comment.Going public in Hong Kong can bring a lot of funding for XPeng Motors. In the long term, dual listing in the United States and Hong Kong can reduce the uncertain risk factors for Chinese concept stocks in the US stock market and attract domestic investors to join in, accelerating market expansion.

In the prospectus, XPeng introduced the use of funding in fields such as product, software, technology, brand, service, and production.

“Product Mix and Technology”

▎Provide funds to develop new intelligent electric vehicle platforms and continue to introduce new models to expand the product mix. Currently, the mid-term upgraded version of XPeng G3, G3i, has been exposed and planned to be launched in July and to commence delivery in September. XPeng’s latest model, P5, which was released in April, will also be delivered in Q4 of this year. Furthermore, XPeng revealed in the prospectus that the fourth XPeng smart electric car will be delivered in 2022.

XPeng Motors will continue to invest in XPILOT and Xmart OS. In terms of autonomous driving, XPeng will develop its next-generation XPILOT, which will enhance the autonomous driving function in a wider range of driving scenarios. Regarding the intelligent cockpit, XPeng will upgrade to the next generation of Xmart OS, and bring more powerful functions in language processing, understanding, and intelligent recommendation.

In addition, XPeng will continue to focus on enhancing hardware capabilities, including but not limited to powertrain, electrical and electronic architecture, and supercharging technology. With the upgraded powertrain and electrical and electronic architecture, it will improve vehicle performance, save energy, reduce costs, and enhance vehicle overall safety. Further refinement to battery pack design and improvement of battery management system can improve security, reduce charging time and extend battery life. Upgrades to display and audio systems can improve interactivity. XPeng will also achieve faster and safer charging with supercharging technology.

“Other Technological Investments”

▎”As a visionary innovator, we plan to continuously explore new areas and develop next-generation technologies that have not been widely used in today’s commercial vehicles.” XPeng’s plan is not limited to smart cars. In flying cars and aerospace, XPeng has also shown great interest.

XPeng will also invest in vehicle modification to comply with different technical standards, requirements, and customer preferences around the world, thereby achieving better internationalization.

In terms of digital operations, XPeng plans to develop a multi-information system that integrates customer management, supply chain management, production, finance, and operations, using big data to improve operational efficiency and decision-making ability.

“Brand Awareness, Service System, and Production Capacity”##小鹏’s Future Plan

小鹏将加大广告投放、车展、线下活动、线上推广等，以提高品牌知名度，并将扩大销售、服务和超级充电网络。

中期计划：小鹏将翻倍销售门店，向二线城市延伸，并建立完整的全国销售网络。服务门店数量也将增加，以满足客户售后服务需求。小鹏还计划将充电站的数量增加超过一倍，并发展销售和营销团队。

小鹏计划在广州和武汉新建年产量均达到10万辆的生产基地。对于现有的肇庆工厂，小鹏将升级设备和技术系统，增大投入，以提高运营效率和产品质量。同时，小鹏也将继续研发先进的制造技术，提高自动化水平，以提高产品质量。肇庆工厂的主要生产步骤如下图所示。

Conclusion

小鹏在获得港交所上市批准后，意味着资本市场对智能汽车的认可，早于蔚来和理想在香港上市，能获得更多的资金支持，小鹏也可以为用户带来更好的产品和体验。那么问题来了，对于小鹏下一款SUV，你们有哪些期待呢？

This article is a translation by ChatGPT of a Chinese report from 42HOW. If you have any questions about it, please email bd@42how.com.