Matters:

Incident: On November 7, the Xiaopeng P7+ was officially launched. A total of three models were launched, including the Xiaopeng P7+ Long Battery Life Max, Super Long Battery Life Max, and the limited edition Max. The price range was 0.1868-0.2188 million yuan, and it was delivered as soon as it went on sale. According to official data, the Xiaopeng P7+ broke through the 0.01 million unit in 12 minutes. As of 24 o'clock on November 7, the Xiaopeng P7+ Dading had 31,528 units.

Guoxin Motor's opinion: The two major missions of the P7+ are: 1) let more people enjoy the space and comfort of luxury executive cars; 2) let more fuel vehicle users experience the pleasure of standard advanced intelligence. The space experience is the largest in its class: the Xiaopeng P7+ has a length of 5m, a wheelbase of 3 meters, a width of nearly 2 meters, and a maximum trunk space of 725L in its class, 1.04m long, 1.1 m wide, and 1.14m deep trunk. The largest expandable space in its class is 2221L. The rear exhaust is a 2m*1.5m double bed; intelligent driving: Xiaopeng P7+ began to be holographically equipped with the Turing AI Advanced Smart Driving NGP as standard. There is no distinction between Max and Pro, no options, no fees, and no subscription. Xiaopeng is equipped with a dual ORIN chip, AI Hawkeye smart driving solution, which is more beautiful without lidar, improving distance perception by 125% and improving recognition speed by 40%; smart cockpit: 8295 cockpit chip: standard 8-inch rear entertainment screen, central control screen, full LCD instrument, and three screens of rear entertainment screen are interconnected.

Considering the volume of the company's new models represented by the Mona M03 and P7+ in the second half of the year, the implementation of the company's pure vision solution penetrated the high-end smart driving model into the market within 0.2 million, accelerated the introduction of more advanced smart driving models, and the company's business cycle continued to improve. We raised the company's revenue forecast and profit forecast. The revenue forecast for 2024-2026 is 46.9/88.5/118.1 billion yuan (the original revenue forecast for 2024/2025/2026 was 46.2/ 73/92 billion yuan), net profit of -6/-1.6/2.7 billion yuan (net profit forecast for 2024/2025/2026 was -6/-2.9/1.1 billion yuan), maintaining the “superior to market” rating.

Commentary:

Xiaopeng P7+ officially launched, Dading surpassed 0.03 million

On November 7, Xiaopeng P7+ was officially launched. A total of three models have been launched, including the Xiaopeng P7+ Long Range Max, Super Long Battery Life Max, and Limited Edition Max. The price range is 0.1868-0.2188 million yuan, and they will be delivered as soon as they are released. According to official data, the Xiaopeng P7+ broke through the 0.01 million unit in 12 minutes. As of 24 o'clock on November 7, the Xiaopeng P7+ Dading had 31,528 units.

The Xiaopeng P7+ is an SUV version of the coupe. In terms of appearance, the overall appearance of the new car is a coupe. The front face uses a family design, with a star ring light on the top and a far and near light set on the bottom, connected to the air outlet, shaped like the letter “P”. The body lines are rounded, and the door handles are hidden to help reduce wind resistance. At the same time, the double-frame five-spoke wheels also make the car body more stylish. In terms of body size, the length, width and height of the new car are 5056/1937/1512 mm, respectively, and the wheelbase is 3000 mm. The rear part of the car has an upturned tail, a penetrating taillight strip, and a concave tail shape, which is recognizable. In terms of body colors, the Xiaopeng P7+ will launch 5 body colors: Crescent Silver, Nebula White, Dark Night Black, Startwilight Purple, and Cloud Beimi.

In terms of interior decoration, it is equipped with a panoramic canopy, three screens, instrument panel+central control screen+rear entertainment screen, and star-fall-style ambient lighting to provide users with a comfortable experience.

All new cars are equipped with the largest 2.1-square-meter panoramic canopy in its class, which enhances visual transparency and blocks 99.9% of ultraviolet rays; all models are equipped with standard Nappa perforated leather “cloud feel” comfortable seats, four front and rear seats are equipped with heating, suction ventilation and massage functions, and the rear seats are standard with “backrest and seat cushion” dual ventilation and 10° electric stepless adjustment to create a zero-pressure ride quality; The standard 20-speaker high-fidelity audio system of all models uses a 7.1.4 panoramic sound field arrangement to provide excellent listening enjoyment for all systems; Standard two-row small table, 8 phone slots, 3 multi-function hooks, 2 Practical configurations such as magnetic panels allow convenient and thoughtful integration into users' daily lives. In addition, the entire car series is equipped with star-fall-style atmosphere lights, which support four special modes: welcome mode, breathing mode, music rhythm, and door opening warning, which can bring users a rich visual experience according to different scenes and atmospheric requirements.

The P7+'s two missions are: 1) let more people enjoy the space and comfort of luxury executive cars; 2) let more fuel vehicle users experience the pleasure of standard advanced intelligence.

1) Let more people enjoy the space and comfort of a luxury executive sedan. As an SUV version of the coupe, the Xiaopeng P7+ has achieved high design value and perfect compatibility with practical space, bringing users beyond the “56E”

Large, executive class space. Based on the 5056mm body length and 3000mm wheelbase, the new car uses the thinnest battery pack in the world — the thickness is only 109mm, and finally achieved the highest 88% “room rate” in its class, as well as a “double 1 meter” front and rear seat space, which can hold the front and rear seats at the same time, and the head space in the second row reaches 973 mm, making it a superior riding experience in the D-class space of a C-class car. The trunk can reach 1.04 x 1.1 x 1.14 m in length, width and depth after opening, bringing the largest volume of 725L in its class. It is a veritable “space monster” that can hold 33 20-inch suitcases when two cars fall down. Excellent ride space and loading capacity make the Xiaopeng P7+ further expand users' car usage scenarios.

2) To allow more fuel vehicle users to experience the fun of intelligent driving with advanced intelligence as standard, the Xiaopeng P7+ is the world's first car equipped with AI advanced intelligent driving as standard, and all models are equipped with Turing AI advanced smart driving as standard. The new car was first equipped with the AI Tianji 5.4.0 developed by Xiaopeng, an end-to-end large model, and an AI Hawkeye smart driving solution. Among them, the AI Hawkeye smart driving solution uses the industry's first single-pixel Lofic architecture, dual Orin-X smart driving chips, and 26 sensing hardware, increasing the sensing distance by 125% and the recognition speed by 40%.

AI Tianji 5.4.0 compared to the 5.3.0 version, the overall anthropomorphism increased by more than 4 times, the success rate of changing lanes increased by 53%, and the success rate of detours increased by 155%.

The Xiaopeng P7+ Turing AI advanced smart driving does not require optional equipment, subscriptions, or payments, so it can be used all over the country, and is easy to use all over the country. Based on a large end-to-end model that is iterated once every 2 days, it can achieve monthly OTA, so that users can use it frequently and always fresh.

In terms of the smart cockpit, the Xiaopeng P7+ is fully connected to the self-developed X-GPT model, and is equipped with a Qualcomm 8295P cockpit chip as standard, improving overall performance by 50%, so that the AI Smart P can not only understand human speech, but also “understand more thoroughly, and act more accurately”, and can also complete the cockpit function settings in one sentence. The cockpit is equipped with a large 15.6-inch central control screen, a 10.25-inch full LCD instrument, and an 8-inch rear entertainment screen. The three screens can be interconnected, and the vehicle's mobile phone can be connected across HUAWEI Hi-Car/Car Link devices, making travel more convenient and intelligent.

With advantages such as price, large space, advanced smart driving, and seat functions as standard, the Xiaopeng P7+ is highly competitive. The price of the Xiaopeng P7+ is 0.1868-0.2188 million yuan. All models are equipped with urban and high-speed driving assistance functions as standard, and the front and rear seats all have heating/ventilation/massage functions, so the competitive advantage is obvious.

In October 2024, Xiaopeng Motor delivered a total of 23,917 new cars, up 20% year on year and 12% month on month. Among them, Xiaopeng MONA M03 delivered over 10,000 units in a row in the two months it went on sale. From January to October 2024, Xiaopeng Motor delivered a total of 122,478 new vehicles, an increase of 21% over the previous year.

Investment advice: Raise the profit forecast and maintain the “better than the market” rating. Considering the company's sales of new models represented by the Mona M03 and P7+ in the second half of the year, the implementation of the company's pure visual solution will penetrate the market within 0.2 million, accelerate the achievement of advanced smart driving parity, and add to the launch of more new models in the future. The company's business cycle continues to improve. We raised the company's revenue forecast and profit forecast. We expect that in 2024/2025/2026, the company will sell 0.18/0.45/0.66 million vehicles, and bike revenue will be 0.23/0.18/0.16 million yuan respectively, then the company's automobile business revenue will be 42.1/81.7/108.7 billion yuan, respectively, and the total revenue will be 46.9/88.4/118.1 billion yuan respectively. Looking ahead to 2024, sales of the company's MONA and P7+ models will increase, platform-based and large-scale R&D and manufacturing can effectively reduce costs, and the company's gross margin is expected to rebound. Therefore, we expect Xiaopeng Motor's gross margin to be 13.41%/15.81%/16.99% in 2024/2025/2026, respectively.

In 2023, the company's R&D spending rate was 17%. In 2024, since the company's main hardware and software platforms have been developed, the Kaesong work of the city XNGP is progressing steadily, and the company's sales revenue has increased significantly, we expect the company's R&D expenses to drop significantly.

In terms of sales management expense ratio, the company's sales management expense ratio in 2023 was 22%. In 2024, the company made key adjustments to the channel system and management team, and internal operating efficiency improved markedly. We expect the sales management expenses rate to drop to 12%. Looking ahead to 2025/2026, the company's sales revenue will increase significantly, and organizational management will continue to be optimized. We expect the sales management expense ratio to drop significantly.

Based on the above, we have raised our profit forecast. We expect revenue for 2024-2026 to be 46.9/88.5/118.1 billion yuan (the original 2024/2025/2026 revenue forecast was 46.2/73/92 billion yuan) and net profit of -6/-1.6/2.7 billion yuan (the original net profit forecast for 2024/2025/2026 was -6/-2.9/1.1 billion yuan), maintaining the “better than the market” rating. The company's profit for 2026 increased by more than 50% (the current forecast value exceeded the growth threshold by 50%, the current value was 2.659 billion, the previous value was 1.097 billion). The text has updated the company's revenue, gross profit margin, expense ratio, etc. forecast instructions, mainly because the automobile industry has heavy assets and automakers have high operating leverage. Considering the continued expansion of Xiaopeng's new models, we raised sales expectations, and the impact of fluctuations in sales volume and revenue on the final net profit was amplified.

Risk warning

Prices of raw materials have risen, and competition for automobile prices continues to intensify.