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Xpeng’s stock drops in Hong Kong, despite the company’s plans to expand globally.
During the media day for the Shanghai car show in Shanghai, China on April 17, 2019, an employee of XPeng Motors stands next to a charging station at the company’s booth. Aly Song/File Photo/REUTERS
Tony Munroe, Yilei Sun, July 7, 2021
In its $1.8 billion Hong Kong dual primary listing on Wednesday, Chinese electric car maker Xpeng Inc shares dipped as much as 3.5 percent after the firm announced it will build future models based on product platforms geared for international markets.
The optimistic tone was short-lived as Xpeng shares started 1.8 percent higher than the HK$165 per share issue price.
In early trade, the stock fell 3.5 percent to HK$159.30.
The seven-year-old manufacturer, led by former Alibaba executive He Xiaopeng, is exploring smart-car technology such as a smart cabin and automated driving. It sells the P7 and P5 cars, as well as the G3 sport utility vehicles.
In two years, Xpeng will launch a new product platform that would allow it to produce many models of various segmentations and sizes, He told Reuters in an interview.
“The platform will be designed for the worldwide market, which means we will take into account global vehicle regulations as we develop it,” he explained. Xpeng, like rivals Nio Inc and BYD, is growing global sales by delivering cars to Norway, where electric vehicle rules are favorable.
Xpeng manufactures its vehicles in two Chinese factories and is currently constructing two more. Zhaoqing is increasing manufacturing hours, according to He. According to its prospectus, Xpeng is developing an SUV model for next year.
“Between 2025 and 2030, China’s auto business may resemble the current smartphone market, which is dominated by a few players,” said He, who previously created a smartphone software startup.
Xpeng plans to continue developing smart-vehicle technologies, as well as a flying automobile capable of driving on roadways, without specifying a timeline. A vertical take-off and landing (VTOL) prototype is currently being tested by the business.
Because it has only been listed in New York for less than two years, Xpeng chose a dual primary listing over a secondary listing. According to the exchange’s rules, the dual primary listing permits qualified Chinese investors to participate through the Stock Connect regime, which connects the mainland Chinese and Hong Kong markets.
Reuters
xpeng IPO Xpeng IPO Xpeng IPO Xpeng IPO Xpen
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