Xpeng Shares Bounce 11% as Company states Growth in Deliveries following months of failure

July 4, 2023: -On Monday, shares of Xpeng were higher in the U.S. after the Chinese electric vehicle maker said a quarterly return to growth for car deliveries, following more than a year of declines.

On Saturday, Xpeng said it delivered 23,205 cars in the double quarter of 2023, logging a 27% every quarter increase. This exceeded the company’s delivery forecast of amid 21,000 and 22,000 units. That was still lower than the 34,422 cars delivered in the previous year’s second quarter.

U.S.-listed shares of Xpeng counted about 2.3%.

Deliveries have been dropping each quarter since the first quarter of 2022 for Xpeng, as it struggled with a challenging macroeconomic environment in China and heightened competition from domestic rivals and from Tesla, which has been cutting prices in China to spur demand. That has also hurt Xpeng’s competitiveness.

Tesla’s strategy is working, with the company reporting global vehicle deliveries of 466,140 in the second quarter, beating analysts’ expectations.

Xpeng stated that deliveries in June alone totaled 8,620 cars, marking a 15% increase over May and the highest monthly delivery figure this year.

The Guangzhou, China-headquartered company said deliveries of its flagship P7 sedan surged 17% in June from May but did not give a specific unit figure.

Xpeng’s latest car, the G6 Ultra Smart Coupe SUV was established at the end of the second quarter, with deliveries beginning this month. Xpeng is hoping this will improve sales in the coming quarters.

Xpeng’s losses continue to widen, and competition is getting fiercer. Last month, Chinese EV start-up Nio made significant car price cuts.

Xpeng has been reorganizing its management structure and overhauling the company regarding the past few months, hoping to unlock growth.

Some of the company’s rivals have managed better. Li Auto delivered 32,575 vehicles in June, while its second-quarter figures totaled 86,533. Nio delivered 10,707 vehicles in June and 23,520 cars in the second quarter, not far ahead of Xpeng.

Therefore, Warren Buffett-backed automaker BYD delivered 253,046 unique energy vehicles, including battery and plug-in hybrids, in June alone, representing a 96% rise yearly.