What’s Driving Xpeng’s Strong Delivery Growth?

Chinese luxury EV maker Xpeng (NYSE:XPEV) reported a strong set of delivery numbers for December. Deliveries grew 82% year-over-year to 36,695 vehicles. The number was also up 19% month-over-month.  Moreover, full-year 2024 deliveries stood at 190,068 units, a 34% increase from 2023. In comparison, Li Auto (NASDAQ:LI), the largest of the emerging EV players in China, delivered 58,513 vehicles for December 2024, an increase of 16.2% year-over-year. Nio stock (NYSE:NIO) reported deliveries of 31,138 vehicles, up 73% compared to last year.

A good portion of Xpeng’s year-over-year growth appears to have been driven by the company’s new sub-brand, Mona, with the first model, the Mona M03, selling over 15,000 units in December, marking the fourth straight month of 10,000 plus sales. The vehicle has a starting price of about RMB 119,800 (about $17,000), which is well below Xpeng’s other models and roughly half the price of Tesla’s Model 3 and Model Y. Besides this, Xpeng also saw strong demand for its XPENG P7+ sedan which was launched in November with sales exceeding 10,000 units for December.

While Xpeng stock has seen lackluster growth over recent years, the Trefis High Quality Portfolio, with a collection of 30 stocks, has provided better returns with less risk versus the benchmark S&P 500 index over the last four year period; less of a roller-coaster ride as evident in HQ Portfolio performance metrics. Given the current uncertain macroeconomic environment around rate cuts and multiple wars, could XPEV face a similar situation as it did in 2021 and 2022 and underperform the S&P over the next 12 months – or will it see a recovery?

Xpeng stock currently trades at roughly 2.6x estimated 2024 revenues. Although this isn’t an unreasonable valuation, it is ahead of its peers Nio and Li Auto, though still well below U.S.-based Tesla, which trades at about 13x estimated 2024 revenues. Moreover, Xpeng’s recent growth has also been much stronger than its rivals. See our analysis of Nio, Xpeng & Li Auto: How Do Chinese EV Stocks Compare? for a detailed look at how Xpeng stock compares with its rivals Li and Nio.

A couple of factors could help to drive Xpeng stock higher. Xpeng is seen as a leader in the Chinese EV market when it comes to automation and assisted driving technology. The company claims to be the only Chinese automaker to offer urban Advanced Driver Assistance Systems (ADAS) that operates without relying on HD maps or relatively expensive LiDAR sensors. This could make Xpeng’s latest autonomous driving systems more affordable and possibly more conducive to mass adoption. Xpeng is also pursuing aggressive international expansion of its operations, aiming to enter over 60 countries by 2025.

[1] Returns as of 1/2/2025
[2] Cumulative total returns since the end of 2016

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