Deutsche Bank also expects Xpeng to launch six products in 2025 and an additional four new products in 2026.
Xpeng (NYSE: XPEV) began pre-sales of its new electric sedan P7+ in China earlier this week in an attempt to create another blockbuster model. Now, analysts at Deutsche Bank has offered their expectations for the model.
“The company has announced that the ‘P7+' has received >30,000 cancellable unit orders, and we expect the ‘P7+' sedan to book an average 6,000 unit sales per month, which is largely in line with the market's expectation of 5-7k units per month,” analyst Wang Bin's team said in a research note sent to investors yesterday.
Xpeng introduced the P7+ to European consumers on October 14 in Paris, France, and announced that the model became available for pre-sale in China at a starting price of RMB 209,800 ($29,440).
Chinese customers who pay a refundable RMB 99 to reserve the model now will receive a RMB 3,000 discount on their purchase price. The model will go on sale and begin deliveries in China in early November.
Wang's team said that the P7+'s pre-sale price is largely in line with their expectation and is a reasonable price.
Since the final official prices generally undercut the pre-sale prices, the final price for the P7+ is expected to start at RMB 190,000 given Xpeng's track record on pricing arrangements, the team said.
Considering the larger size of the P7+ sedan, the price range may be slightly higher than the P7 sedan retail transaction price, the team said.
The Xpeng P7 with an official price tag of RMB 224,000 yuan has a retail transaction price at dealer level starting at RMB 199,000, taking into account a cash discount of RMB 24,000, according to the team.
Compared to its head-to-head rivals such as the BYD Han EV, Lynk & Co Z10, Xiaomi SU7, Tesla Model 3, and the Xpeng P7, the P7+sedan is longer, taller, and has a larger wheelbase, said Wang's team.
What's more, Xpeng said the P7+ is the world's first AI vehicle to enable autonomous driving in urban and rural areas across the country, the team noted.
That's thanks to its proprietary “Eagle Eye” vision-based perception solution, an architecture that removes LiDAR from its autonomous driving hardware suite.
In addition, Xpeng announced an aggressive cost-savings strategy last year to reduce vehicle BOM (bill of materials) costs by 25 percent and autonomous driving hardware costs by 50 percent.
The P7+ is the first product of these cost-saving initiatives, and according to the company's guidance, it will deliver double-digit gross margins, Deutsche Bank said.
Thanks to the successful debut of the P7+sedan, Xpeng will enjoy double-digit vehicle gross margins going forward, as upcoming new products should be able to enjoy the same 25 percent vehicle BOM cost savings, the team said.
Xpeng management had mentioned that the company planned to launch 30 new products in the next three years, including new models and facelifts.
Following the launch of the Mona M03 mid-size sedan and P7+ large sedan in 2024, Deutsche Bank expects Xpeng to launch six products in 2025, including the G5 compact SUV (code F62), the G7 large SUV (code F01), the H01 ultra-large SUV (code H01), the middle-size Mona SUV, the P9 ultra-large sedan (code E29), and the new generation P7 sedan.
Looking ahead to 2026, the team expects Xpeng to launch four new products, including a compact Mona SUV, a new generation G9 large SUV (code E01), the PHEV version of above-mentioned H01 ultra-large SUV (code G01), and an ultra-large MPV (code X3).
Based on these 10 new products expected to debut in 2025 and 2026, the team is currently forecasting Xpeng to sell 380,000 units in 2025 and 600,000 units in 2026.
($1 = RMB 7.1267)
Xpeng says P7+ gets over 30,000 pre-orders in less than 2 hours
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