Xpeng X9 electric minivan at the Beijing Auto Show on April 25, 2024.
CNBC | Evelyn Cheng
BEIJING – Chinese electric vehicle company Shpeng The company’s shares soared after reporting higher profits and upbeat delivery forecasts for the second quarter.
companies Shares listed in Hong Kong up more than 13% in morning trading Wednesday. The U.S.-listed stock rose nearly 6% in U.S. trading on Tuesday following the release of first-quarter results.
Xpeng said vehicle margins rose 5.5% in the first three months of the year, compared with negative 2.5% in the previous quarter. Car margin is a measure of profitability: the higher the margin, the more profit a company makes from car sales.
The company forecast second-quarter deliveries of 29,000 to 32,000 vehicles, up 25% from last year.
Xpeng delivered 21,821 vehicles in the first quarter of the year and 9,393 vehicles in April.
Following the earnings report, Nomura analysts said on Wednesday they were revising their estimates for Xpeng.
“Overall, we see XPENG making progress in executing its business plans and believe it will see some growth in the future,” the report said.
“In the meantime, with increasing competition in the broader market making smaller players more vulnerable, we remain somewhat cautious and suggest investors keep a close eye on the new model, which will be launched under the MONA brand next month,” Nomura analysts said.
Like other companies seeking to remain competitive in China’s electric vehicle market, Xpeng is expanding its product line with a lower-priced car brand called Mona.
The first Mona, an electric sedan priced under 200,000 yuan ($27,890), will be launched in June, with mass deliveries to begin in the third quarter, according to the company.
Xpeng attributed the revenue of several hundred million yuan to its partnership with German automaker Volkswagen. The services segment as a whole grew 93.1% year-on-year to RMB 1 billion in the first quarter.
The Chinese company said it is partnering with auto dealer groups in Western Europe, Southeast Asia, the Middle East and Australia to open new stores in the first half of this year. Overall, Xpeng said it plans to expand its sales network to more than 20 countries. That’s according to a FactSet transcript of its first-quarter earnings report.