Founded in 2014, Xpeng has quickly established itself as a major player in the Chinese electric vehicle market. Known for its innovative technology and sleek designs, Xpeng has recently launched its budget sub-brand MONA, with the first model priced from $16,813. This move is aimed at tapping into the mainstream segment of China’s rapidly growing EV market, which accounts for a third of total car sales in the country.
With the introduction of the MONA M03 electric hatchback coupe, Xpeng is offering consumers an affordable option in the 100,000-150,000 yuan range. This puts the M03 in direct competition with other popular EVs in the market. The M03 will come in two versions – an entry-level model without advanced autonomous driving technology priced at $16,813, and the M03 Max with Tesla-like technology priced at $21,866. Both models are priced lower than Xpeng’s lowest priced EV, the P5 sedan, which starts at $22,000.
In a bid to achieve better economy of scale and break even, Xpeng is banking on the success of its Mona brand. The company aims to sell at least 100,000 MONA cars annually. Xpeng’s gross profit margin has seen improvement this year, with a 20% increase in the number of EVs sold in the first seven months of the year compared to the previous year. Additionally, revenue from offering technology services to Volkswagen has provided a boost.
He Xiaopeng, co-founder and CEO of Xpeng Motors, announced at a launch gala in Beijing that deliveries of the M03 Max will begin early next year. This model is touted as “the only car with advanced autonomous driving at less than 200,000 yuan.” Xpeng’s rival Nio also launched a lower-priced brand, Onvo, which is set to enter the market in September with the Onvo L60.
Despite the high competition in the EV market, both Xpeng’s MONA and Nio’s Onvo brands have adopted a strategy of not using lidar sensors in their advanced autonomous driving technologies. This approach is similar to Tesla’s camera-only Full-Self Driving system, which helps lower hardware costs for EVs. While the price of lidar sensors has decreased significantly in the past few years, Xpeng removed the lidar sensor from its P5 model in order to reduce the price and cater to price-sensitive consumers.
Xpeng’s decision to launch the MONA brand reflects its commitment to innovation and affordability in the rapidly evolving EV market. With the introduction of the M03 model and plans for future expansion, Xpeng is poised to strengthen its position as a key player in the Chinese electric vehicle industry.