By PAN Tao, ZHOU Shuqi
EV maker XPeng cut prices and reconfigured specifications for its premium SUV, the G9, only two days after its launch. The company said the adjustments “reflect [its] commitment to customer experience and the high demand for certain specifications.” But everyone knows this is not the whole story. Buyers were not happy. Nor was the stock market.
Car-crash debut
The day after the launch, XPeng stock plunged by 11.5 percent, wiping out HK$12 billion of market value. In the US, the stock has dropped 75 percent from the highs of this year, prompting founder HE Xiaopeng to buy nearly US$30 million worth of shares on September 25 to restore confidence.
The G9 was originally priced from 309,900 yuan (US,393) to 459,000 yuan, the most expensive Xpeng car so far. But buyers were confused by the many combinations of ranges, levels of autonomy and amenities, and were infuriated that the assisted-driving software, G9’s biggest selling point, was not even compatible with the cheapest option. Some canceled their orders.
The company hopes that G9 will gradually replace the cheaper, low-margin P7 as the flagship model. To soothe buyers, XPeng offered some previously optional extras, such as a top-range audio system, for free. The freebies are worth up to 30,000 yuan, and the company is trying to market them as discounts.
A buyer from Zhejiang who canceled his order said he was disappointed that many heavily advertised features were only available for the most expensive option. “It makes me feel that XPeng doesn’t put customers first,” he said.
Another buyer said he had thought G9 was a good deal but changed his mind after watching the release. He actually canceled his order, but had to wait for three days for a refund When XPeng upgraded the offerings, he changed his mind again and decided to keep it.
Confusion abounds
Posing as potential buyers, Jiemian News visited two XPeng stores in Beijing and Shanghai. The G9 was on display in both stores. Salespeople said most visitors come to ask about the G9, and that there haven’t been many cancellations. A salesperson in the Beijing store said the best-selling configuration so far is the 349,900-yuan 702 Pro, which falls right in the middle of the range.
The Shanghai salesperson admitted that the options were confusing. “We ourselves couldn’t even figure out what price came with what. And when customers asked, we could only tell them we would get back to them later,” she said.
ZHANG Yizhao, a partner at Ernst & Young Parthenon, said mature car brands often offer many options, but EV startups risk a backlash and supply chain difficulties if they do so.
Money-back guarantee
XPeng reported a 10.9 percent gross margin for the first half of this year, lower than Nio’s 16.7 percent and Li Auto’s 21.5 percent. XPeng plans to release two more models next year, priced between 150,000 yuan and 500,000 yuan.
G9 buyers can get their 5000-yuan deposit refunded if they cancel before October 31.
