Xpeng is ramping up spending to develop intelligent cars this year, dedicating 3.5 billion yuan ($486 million) to the push and initiating a plan to hire 4,000 new staff to boost its competitiveness in the burgeoning electric vehicle market in China.
While recently addressing employees in a letter, Xpeng founder and chief executive He Xiaopeng said the industry is entering a “bloodbath” and that the firm intends to launch 30 new models over the coming three years.
“It will be the first year that the EV competition enters into a new phase of bloodbath,” he wrote. “Xpeng has been striving to survive fierce competition right from the beginning and has accumulated sufficient experience. I believe we will eventually triumph if we keep up the hard work.”
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This year, Xpeng will begin production of two new platforms, one of which will focus on developing and building mass-market EVs starting at around 150,000 yuan (~$21,000) while the second will be used for premium models priced from over 300,000 yuan (~$42,000). Xpeng’s boss added that artificial intelligence is a key area of investment for the company but failed to provide additional information about the firm’s planned next models.
“Only big players with products and technologies affordable to consumers can survive the cutthroat market,” Cao Hua from Shanghai private-equity firm Unity Asset Management told the South China Morning Post. “Xpeng, as one of the market leaders, is under pressure to strengthen research and development capability as well as improve sales.”
Chinese carmakers are being forced to make significant investments as they fight to survive. China Business News reported in September last year that at least 15 electric vehicle start-ups across the country with a combined annual production capacity exceeding 10 million units had recently collapsed or were on the brink of bankruptcy.
