Xpeng is planning to stop updating the G3 lineup and may design a new product to replace it, according to local media.
(Image credit: CnEVPost)
Xpeng (NYSE: XPEV) is planning to discontinue the sale of its G3 series SUVs and stop updating the lineup, local media outlet Jiemian reported today, citing three people familiar with the matter, adding that the company may design a new product to replace it.
The G3 lineup includes the G3 and G3i, and the currently on-sale G3i is still available for booking and purchase, but there will be no facelift for the lineup, and Xpeng's stores in major shopping districts are no longer displaying the G3i, according to the report.
The G3i will be phased out of production, cleared of inventory, and replaced by a new product, these people said.
The G3i's product lineup is already looking old and does not fit in with Xpeng's strategy of switching the entire lineup to the SEPA (Smart Electric Platform Architecture) 2.0 architecture, the report said.
In addition, among Xpeng's SUVs, the G6 is the main seller, with steady monthly deliveries of around 8,000 units, and the 2024 G9 has gained consumer acceptance, all of which reduces the need for the G3i, the report said.
Xpeng said this was a decision made based on the company's long-term planning, in order to allow it to focus more on advancing its future growth strategy, Jiemian said in a separate report, citing the company's response.
The G3, Xpeng's first production vehicle, was unveiled in January 2018 and officially launched and began deliveries in December 2018.
In July 2019, Xpeng launched the 2020 G3. In July 2021, the company rolled out the G3i and kept the G3 on sale.
Notably, there were no deliveries of the G3 lineup last month. The G3i is the least expensive currently on sale from Xpeng, with a starting price of RMB 148,900 ($20,840).
Xpeng delivered 20,041 vehicles in November, 8,750 for the G6, 5,778 for the G9, 2,990 for the P7 series, and 2,523 for the P5, according to a CnEVPost report earlier this month.
The Xpeng G3 series had zero deliveries in November, the first time the model has had zero volume since December 2018.
Xpeng took an inventory write-down of RMB 230 million in the third quarter related to the G3i model, according to its earnings report.
The necessity for the lower-priced G3i is decreasing amid increased G6 sales, Jiemian said, citing a person familiar with the matter.
The G3i boosts inventory levels, pulls down gross margins and contributes almost negligibly to sales, and it's normal for this product line to be dropped, the person said.
He also believes Xpeng should have taken a similar approach with the P5 as it did with the G3i and focused on the P7 and P7i, according to the report.
"We have been removing the G3i display space in our stores for some time now, mainly to make room for the X9," Jiemian quoted an Xpeng salesperson as saying.
The X9 is Xpeng's first MPV (Multi-Purpose Vehicle) model and will be officially launched on January 1.
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