Source: Securities Times.

Recently, there were media reports that CEO Wang Fengying has submitted her resignation to Xiaopeng Motors Chairman and CEO He Xiaopeng. In response, Wang Fengying denied on social media, stating that the Chinese automobile industry has been spreading rumors, causing her, a 30-year automotive veteran, to be "particularly distressed." In terms of product structure, the operating income of 10-30 billion yuan products were respectively 401/1288/60 million yuan at Xiaopeng Motors.$XPENG-W (09868.HK)$/$XPeng (XPEV.US)$Many executives of car companies are now speaking out about the fierce competition in the automobile industry, from price to technology to public opinion. Representatives of car executives, such as Guangzhou Automobile Group Chairman Zeng Qinghong, believe that "this is not the solution," but car executives, such as Changan Automobile Chairman Zhu Huarong, believe that driving out the bad money with the good is a process.

Xiaopeng Automotive CEO denies rumors, stating that she firmly believes in "AI Defining Cars."

The rumor about Xiaopeng Motors CEO's resignation has caused great concern in the industry. This is mainly because Wang Fengying is a "veteran" of the automotive industry with 30 years of experience, and her every move affects the industry.

Prior to joining Xiaopeng Motors, Wang Fengying worked at Great Wall Motor from 1991 to 2022, serving as general manager, executive director, and vice chairman.

Regarding the resignation rumors, Wang Fengying responded on social media: "The Chinese automotive industry is becoming more and more chaotic, from rolling technology, rolling configuration, rolling prices, all the way to today's 'rolling public opinion,' various rumors. As a 30-year veteran of the automotive industry, I feel particularly distressed. We at Xiaopeng Motors firmly believe that AI will define cars and strive to lead the innovation of China's intelligent automobiles!"

It can be seen that Xiaopeng Motors is choosing to break through with technology against the backdrop of the all-around "rolling" of the Chinese automobile industry, using AI technology as the breakthrough direction. What is "AI Defining Cars"? On May 20th, Xiaopeng Motors announced that it will push the AI MediaTek system to all of its models for full user coverage. Simply put, the AI MediaTek system is an operating system that fully applies AI technology to the intelligent cockpit and intelligent driving to achieve end-to-end deep application of large-scale models and enhance the intelligent experience of automobiles.

On June 6th to 8th, at the Chongqing Auto China forum, Chairman Zeng Qinghong of Guangzhou Auto Group said, "This is not the solution." He believes that the purpose of enterprises is to make profits, contribute to the country and society, pay taxes, and maintain employment, but if we continue like this, enterprises will lay off workers. "We should have a broad vision and a long-term strategic approach, rather than focus on short-term gains," said Zeng Qinghong. He said that when the penetration rate of new energy vehicles reaches 50%, we should study and promote measures to support traditional enterprises in upgrading and transforming, balancing the development of new energy and fuel vehicles.

As for the decline in sales, Xiaopeng Motors is gradually falling out of the top tier. In May 2024, Xiaopeng Motors delivered 10,146 new cars, an increase of 35% YoY. By comparison, Li Auto delivered 35,020 new cars in May, an increase of 23.8% YoY, and NIO delivered 20,544 new cars, an increase of 233.8% YoY. It can be seen that Xiaopeng Motors, once part of the "three rookies," is now at the bottom of the sales rankings.

Many car executives have spoken up recently about the increasingly fierce competition in the Chinese automobile industry, including both rolling technology and rolling prices. In fact, many car company executives now believe that competition in the automobile industry is becoming increasingly fierce.

Before the introduction of Xiaopeng Motors, Wang Fengying was employed at Great Wall Motor from 1991 until 2022, serving in various roles such as general manager and vice chairman.

Regarding the resignation rumors, Wang Fengying responded on social media: "The Chinese automotive industry is becoming more and more chaotic, from rolling technology, rolling configuration, rolling prices, all the way to today's 'rolling public opinion,' various rumors. As a 30-year veteran of the automotive industry, I feel particularly distressed. We at Xiaopeng Motors firmly believe that AI will define cars and strive to lead the innovation of China's intelligent automobiles!"

It can be seen that Xiaopeng Motors is choosing to break through with technology against the backdrop of the all-around "rolling" of the Chinese automobile industry, using AI technology as the breakthrough direction. What is "AI Defining Cars"? On May 20th, Xiaopeng Motors announced that it will push the AI MediaTek system to all of its models for full user coverage. Simply put, the AI MediaTek system is an operating system that fully applies AI technology to the intelligent cockpit and intelligent driving to achieve end-to-end deep application of large-scale models and enhance the intelligent experience of automobiles.

On June 6th to 8th, at the Chongqing Auto China forum, Chairman Zeng Qinghong of Guangzhou Auto Group said, "This is not the solution." He believes that the purpose of enterprises is to make profits, contribute to the country and society, pay taxes, and maintain employment, but if we continue like this, enterprises will lay off workers. "We should have a broad vision and a long-term strategic approach, rather than focus on short-term gains," said Zeng Qinghong. He said that when the penetration rate of new energy vehicles reaches 50%, we should study and promote measures to support traditional enterprises in upgrading and transforming, balancing the development of new energy and fuel vehicles.

As for Xiaopeng Motors in particular, it is promoting the use of AI technology to define cars and enhance the intelligent experience. On June 6th and 11th, Xiaopeng Motors released the first product of its new MONA series, named Xiaopeng M03. According to a research report from Pujiang International, the new energy vehicle enterprises, represented by new forces, are accelerating the downward penetration of high-end intelligent driving and main sales price segments. For example, the first model of the MONA series to be launched by Xiaopeng is positioned as a global AI-based intelligent driving car popularizer, which is "promoting the equality of technology" in practice.

Li Shufu, Chairman of Geely Holding Group, also said: "The degree of internal integration of China's automobile industry is the highest in the world, and the price war is unparalleled, which is both good and bad. If the marketization level is high, the law is sound, the enforcement is strict, and the competition is transparent and fair, it is a good thing, otherwise it is a bad thing."

Li Shufu believes that endless internal integration and crude price wars result in cutting corners, counterfeiting, and non-compliant disorderly competition. For the automobile industry, healthy and lawful competition is crucial in order to achieve sustainable and high-quality development and to consolidate China's achievements in electric vehicles.

However, Zhu Huarong, Chairman of Changan Automobile, believes: "Integration is the normal process of driving out inferior currency with good currency, and it is the best way for the industry to quickly return to benign competition." He said that integration means pursuing excellence, pushing Chinese brands to new heights, maximizing user benefits, and creating value for users.

Wang Chuanfu, Chairman and President of BYD, said that regardless of the integration of prices, technology, scale, or traffic, it is actually a kind of market competition, and the core of market competition is the "surplus economy". Only with surplus can there be competition, and competition can produce prosperity, which is a natural law and need not be anxious. Wang Chuanfu said: "All entrepreneurs should actively embrace and participate in this integration, and truly emerge in the competition."

From the perspective of domestic automobile sales, Sinolink Securities' research report indicates that from June 1 to 10, the retail sales of China's passenger vehicle market dropped by 8% year-on-year, to 360,000 vehicles. The retail sales of China's new energy passenger vehicle market reached 180,000 vehicles, a year-on-year increase of 27%. Sinolink Securities believes that the continued sluggish consumption of conventional fuel cars is an important factor in suppressing a comprehensive recovery of the automobile market. Oil-fueled car companies currently lack pricing space and motivation, and the market is still driven by electric cars. It is expected that in June and even the whole year, electric cars will remain strong, and the substitution of oil and electricity will accelerate.

According to the Pu Yin International research report, since May, the price competition in the automobile industry has eased slightly. So far, the end of car companies' pricing on old car models and the impact of new car models on prices have basically been played out, and the possibility and space for continuing high-intensity price cuts in the second quarter are relatively limited. The easing of price competition is conducive to eliminating consumers' watchful psychology and translating purchasing intentions into new orders.

Editor/tolk