Tesla's Chinese Rivals Xpeng And Li Auto Sell Record Cars In July As Competition Heats Up In The World's Largest EV Market

Li Auto's sales jumped 251 per cent year on year in July to 8,589 units, while Xpeng's sales surged 228 per cent to 8,040 cars Guangdong-based Xpeng said last week that it has started building a new plant in Wuhan, Hubei province
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Tesla's Chinese Rivals Xpeng And Li Auto Sell Record Cars In July As Competition Heats Up In The World's Largest EV Market

Li Auto and Xpeng, Tesla's Chinese rivals, reported record monthly deliveries in July, as electric-vehicle makers position themselves to take advantage of rising sales in the world's largest EV market that are likely to double this year.

Nasdaq-listed Li Auto sold 8,589 units of its Li One SUV in July, a jump of 251.3 per cent year on year. It was also 11.4 per cent higher compared to June.

Xpeng, listed both on New York and Hong Kong stock exchanges, delivered 8,040 vehicles last month, which translated into a year-on-year increase of 228 per cent and a month-on-month rise of 22 per cent.

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"Chinese drivers' rising penchant for EVs offered the market leaders, including Tesla, a good opportunity to improve sales," said Gao Shen, an independent analyst in Shanghai. "For China's EV start-ups like Xpeng and Li Auto, a monthly sales of 10,000 units will be a meaningful threshold to target because after exceeding that level, a carmaker will be viewed as a powerful player in the automotive industry."

Li Auto's Li One model is displayed at a showroom Lujiazui, Shanghai. Photo: Shutterstock Images

Li Auto's Li One model is displayed at a showroom Lujiazui, Shanghai. Photo: Shutterstock Images

Li Auto, Xpeng, and NIO are the three main Chinese smart-EV makers who have the potential to challenge Elon Musk's Tesla in the mainland, according to industry observers.

The three EV makers are revving up development of new models that can cater to wealthy consumers' demands amid their push for a leading position in the future of mobility, but they still trail the global leader in terms of deliveries.

The US carmaker's Gigafactory 3 in Shanghai delivered a total of 33,155 Model 3 and Model Y cars in June, a touch lower than the 33,463 units in May, according to the China Passenger Car Association (CPCA). Tesla does not reveal monthly sales figures, but they are compiled by the CPCA, which will release the July figures later.

The association recently forecast full-year electric car sales in China, the world's largest EV market, could more than double to 2.4 million this year.

Last month, Guangdong-based Xpeng raised HK$14 billion (US$1.8 billion) in a second primary listing in Hong Kong, less than 12 months after a US$1.72 billion initial public offering and a US$2.48 billion top-up sale in New York.

The company said on Saturday that it has started building a new plant in Wuhan, capital of central China's Hubei province.

The plant, its third facility after a contract manufacturing site in Zhengzhou and a factory in Zhaoqing, Guangdong, is expected to have an annual capacity of 100,000 units.

Tesla, meanwhile, is cutting the prices of its models in China to shore up its popularity and sales amid a series of issues with buyers regarding the quality of its cars.

On Friday, Tesla announced that the price of the standard range Model 3 after subsidy would be reduced by 15,000 yuan (US$2,320), or 6 per cent, to 235,900 yuan.

This follows the launch of a cheaper version of Shanghai-made Model Y SUV last month, which has drawn massive orders from mainland motorists.

The new standard range Model Y, priced at 276,000 yuan, is 20 per cent cheaper than its long-range version. However, buyers will have to wait until September for deliveries.

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