Xpeng Inc XPEV co-founder and CEO He Xiaopeng said on Monday the electric vehicle maker is targeting a gross margin of 25% or more in the medium and long term.
What Happened: Xpeng’s gross margin, a closely followed metric, fell to 12% in the fourth quarter from 14.4% for the third quarter on higher costs related to supply chain issues and rising commodity prices.
“I have confidence in our ability to achieve structural improvement of gross margin for our new models, including G9, and ultimately improve overall gross margin,” Xiaopeng told analysts on a post-earnings call.
The Guangzhou-based company reported a gross margin of 12.5% for fiscal 2021, compared with 4.6% for the prior year.
Tesla Inc’s TSLA 2021 adjusted automotive gross margin was 29.2%, and Nio Inc's NIO was 18.9%.
Xpeng on Monday reported a fourth-quarter loss of $202 million, or 22 cents on an adjusted per-share basis, and revenue of $1.34 billion.
See Also: Tesla Rival Nio Retains Bullish Rating From This Analyst, But Gets A Price-Target Cut: Here's Why
Xiaopeng also spoke about demand and supply challenges, price hikes, new launches, and Robotaxi plans. Here are the key takeaways from the call:
Demand is currently higher than production.
- Xpeng raised prices by $1,600 to $3,200 each starting March 21 over the cost of batteries and raw materials.
- Company aims to deliver over 10,000 P7 units in a single month this year as more production capacity comes online.
- Xpeng is planning to launch two newly established EV platforms in 2023.
- Expects deliveries to reach approximately 33,500 to 34,000 in the first quarter, and total revenue to be between approximately $1.15 billion to $1.16 billion.
- For P7 and P5 models delivered in the fourth quarter, the attach rate of the XPILOT 3.0 software was close to 20%. Xpeng excpects the attach rate to exceed 50% when the chip supply recovers to normal levels.
- Xpeng plans to test the robotaxi capability and performance by the fourth quarter of this year on P9 and estimates to achieve or work toward the goal of autonomous driving by 2026.
- Price Action: Xpeng stock closed 0.3% higher at $27 a share on Monday.
Photo courtesy: Xpeng
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