Xpeng attempts a global transformation

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When I visited the Chinese electric car company ExpingAfter opening the company’s new headquarters in Guangzhou last week, what caught my attention was not just how shiny it looked compared to the building I visited last year, but the fluency of its global mindset, right down to small details like subtle English translations in signage and presentations. It’s gone beyond the quick “innovation” signs we often see in China.

Leaders of Xpeng’s autonomous driving, robotics and flying car units each gave 40-minute presentations entirely in English — including their platforms — without any translation device. In a conversation with reporters, Xpeng’s founder and CEO, He Xiaopeng, announced a ten-year goal of generating half of the company’s sales from outside China.

He has reason for optimism. Xpeng has achieved 12 consecutive months with more than 30,000 deliveries each, exporting a small but growing number of vehicles: 29000 In only three quarters. That was more than double what Xpeng shipped a year earlier.

Xpeng’s global ambitions reflect a broader trend across China. In the past year or so, overseas expansion has become a top priority for almost every Chinese company — an enthusiasm that Joe Ngai, head of McKinsey Greater China, said was unprecedented.

“It’s amazing what this phenomenon is,” he said, noting that fierce competition in China is pushing local companies to seek higher profit margins abroad. But he warned that it will not be easy, and that local partnerships will be important.

Overseas markets accounted for just 8% of the total revenue of the 50 largest Chinese companies as of 2021, according to McKinsey. This is far less than 31% of the foreign revenues of the largest US companies, the data showed.

I first learned about Xpeng on the sidelines East Tech West Conference on CNBC In 2018, when the Alibaba-backed startup touted its self-driving superiority and drew comparisons to Tesla.

But Xpeng has not been able to launch its regulatory-approved driver assistance systems on a large scale for a few years now. Average deliveries Just over 10,000 per month in 2022It fell well below that in early 2023 while competitors surged ahead.

At a small Xpeng event in Shanghai, which I attended in March 2023, there were hints that the startup might have the technology — but not the product Chinese consumers want. the Event speaker, Chenzhou WuHead of Autonomous Leadership He left soon To lead NvidiaAutomotive chips business.

Also in early 2023, Xpeng hired a veteran CEO of Great Wall Motor Fengying Wang as Chairman To oversee product and sales planning. Her leadership, along with the launch of the affordable Mona M03, helped transform the company. Wang remains with Xpeng today.

“Of course, it’s much better when [the electric car companies have an] “The interface is in English,” said Nick Kolodko, a Shanghai-based car influencer who has lived in China for more than a decade. He pointed out that some Chinese electric car startups in Europe had in-car AI assistants that did not support local languages.

He has since noticed that some Chinese automakers are giving their overseas teams more control over the past 18 months or so, although he said there is still a gap with European rivals in shaping a compelling brand narrative.

It is crucial to Xpeng that she gets An investment of 700 million dollars From the German automobile giant Volkswagen in July 2023. The two companies gradually expanded the partnership to include Technological development.

In the future, “Chinese electric car makers could also take a lot of time [intellectual property] Fees like that [tech] “This will be important because 30 or 40 years ago, European automakers and U.S. automakers… [were] “We do exactly the same thing in the Chinese markets.”

Currently, Xpeng is taking the first step beyond automobile exports and domestic production.

The company opened its first European factory in Austria in August, and plans to produce tens of thousands of cars there next year, according to Brian Gu, co-president of Xpeng. Gu, a former JPMorgan executive, has been with Xpeng since its early days and helped the startup build relationships with Wall Street ahead of its listings in the US and Hong Kong.

Xpeng is scheduled to report earnings on Monday. In the first half of 2025Xpeng claimed to be the best-selling Chinese emerging new energy vehicle brand in Norway, France, Singapore and Israel.

“The overseas expansion of Chinese companies will be fully part of the global business landscape over the next five years, I have no doubt about that,” McKinsey’s Ngai said.

China’s exports decline. Shipments of Chinese goods fell in October For the first time in more than a year Companies have slowed down the increase in their orders to stay ahead of tariffs.

A fragile truce between the United States and China. Beijing has formalized the agreements Delay restrictions On some exports of rare earth elements for a year.

Chapter Two of Lukin. Jinyi Guo, CEO of Luckin Coffee, said that the company Preparing to re-list in the United States Five years after an accounting scandal. It will face new Chinese IPO rules to do so.

Hong Kong Hang Seng Index It added 0.81%, while the mainland CSI 300 lost 0.13%.

The Chinese yuan was traded in external transactions in the latest transactions at 7.1189 against the dollar.

November 13: Baidu contract Annual conference With expected AI details; Tencent announces its quarterly earnings

November 14: China publishes data on retail sales, industrial production and investment for October. Alibaba concludes its extended Singles’ Day shopping event

November 17: Xpeng announces its quarterly earnings

November 18: Baidu and iQiyi announce their quarterly results