Chinese electric vehicle maker XPeng Motors delivered 5,101 units in October, an annual decrease of 49.7% and a quarterly decrease of 39.8%. In the capital market, the firm’s performance has been even worse. Compared with its peak share price of $54.96 on November 30, 2021, its closing price on November 16 of this year was only $9.01, having fallen by more than 80%. In September, the faulty release of its G9, a vehicle model targeted at the middle and high-end car market, pushed XPeng to the brink.
He Xiaopeng, the chairman and CEO of the company, has attracted attention in dealing with this set of challenges. After the poor performance of the G9, He held several management meetings to reflect on the company’s operations and product strategy. At the end of October, XPeng held an internal meeting, during which He reportedly choked up and reflected on the implementation problems.
Sources have said that He Xiaopeng initiated internal organizational adjustments, establishing five committees – products, strategy, technology, sales and OTA – as well as three vehicle platforms labelled E, F and H. He personally serves as the director of the Product and Strategy Committee, and the heads of the three platforms also report directly to him.
He Xiaopeng accepted an interview with LatePost Auto, mentioning that even without the G9 incident, he planned to make a round of organizational adjustments at the end of this year. The accident at a G9 press conference dampened voices of opposition within the firm. “In such a situation, it is easier to unify employees,” He said.
He Xiaopeng first invested in Xpeng Motors as an investor, and only in 2017 announced that he would go “all in vehicle manufacturering,” becoming the chairman of XPeng. At that time, there were only over 300 employees in the firm, and there was only one HR in the whole company, which was a “guerrilla” who worked behind closed doors. He believes that Alibaba and Huawei have the strongest organizations of Chinese companies. Since he is more familiar with Alibaba, the firm’s human resources system was introduced by him to XPeng, poaching certain leading employees.
The company now employs about 16,000 people. When asked about current organizational challenges, He Xiaopeng replied, “They are challenges to develop from a company with more than 10,000 people to a company with tens of thousands of people while maintaining higher efficiency; whether employees, middle-level and senior managers have enough sense of responsibility and self-drive to adjust the reasonable organizational structure. To meet our later strategy, it is needed to decompose the enterprise strategy into product strategy, and decompose the product strategy into a two-year path. Then it needs to decompose the two-year path into OKR [Objectives and Key Results] that can be realized in the second year.”
At present, the price range of the XPeng G9 is 309,900-469,900 yuan ($43,453 – $65,888), which is divided into three series of 570km, 702km and 650km, with a total of eight versions. Up to now, XPeng has not disclosed order information for the G9. However, He Xiaopeng said that with current orders, more than 60% of customers have chosen the 702km version, while more than 60% have chosen the Max configuration.
The CEO said, “Next year, including the altered model, we will have three products. The G9 is a very important one. It is the start of models based on our brand-new intelligent vehicle platform, which we will adhere to for more than two years. We should do a good job in the car market priced from 300,000 yuan. The current monthly sales volume of 300,000-yuan and above priced China-made electric SUVs is not high, and Tesla’s Model Y has dropped its price below 300,000 yuan. Besides, the latter is not a Chinese brand. I think we should target the first Chinese vehicle brand. That is our goal.”