Xpeng’s U.S.-listed shares fell 3.1% in premarket trading on Monday after the Chinese electric vehicle manufacturer forecast third-quarter revenue below Wall Street expectations, highlighting the strain from intensifying price competition in the domestic market.
The company projected revenue between 21.7 billion yuan and 23.4 billion yuan ($3.23 billion) for the three months ended September 30, well below the average analyst estimate of 26.61 billion yuan compiled by LSEG. Xpeng’s guidance underscores the challenges facing automakers in China’s slowing passenger-vehicle market, where prolonged discounting and weak consumer demand have eroded profit margins.
In the second quarter ended June 30, Xpeng delivered 103,295 units, within its forecast range of 100,000 to 106,000 vehicles. Despite meeting delivery targets, the company reported a net loss attributable to ordinary shareholders of 1.34 billion yuan, more than double the estimated 511.8 million yuan loss. Xpeng attributed the wider shortfall to industry-wide cost pressures and competitive pricing strategies.
The broader market backdrop remains challenging. China’s passenger-vehicle sales have declined steadily since late 2023, pressured by tepid consumer spending and an oversupply of vehicles. Automakers are increasingly turning to exports to offset domestic weakness, though pricing power remains constrained.
Xpeng also faces operational headwinds. In July, the company recalled 264,842 electric vehicles in China as part of a nationwide recall of about 4.3 million vehicles related to emergency door-release issues. Earlier this month, Xpeng launched the MONA L03 AI SUV coupe, its latest model aimed at reviving demand in a crowded segment.
Separately, Xpeng’s robotics unit secured more than $900 million in its first funding round, setting a record for single private financing in China’s embodied artificial intelligence sector. The company did not disclose further details on the use of proceeds or the unit’s near-term commercialization plans.
Xpeng’s shares have declined roughly 40% year-to-date, reflecting investor concerns over its ability to navigate China’s competitive EV landscape amid slowing domestic growth and margin compression.
