September 6, 2024

 

(INVESTORS ARE PAYING ATTENTION TO CHINA’S EV INDUSTRY)

September 6, 2024

 

Hello everyone

 

Xpeng (XPEV) to launch new models later this year.

Chinese EV maker, Xpeng could see a significant move by the end of the year as two new key EV models are being unveiled in the fourth quarter of this year.

JP Morgan has upgraded the China-based electric vehicle maker from overweight to neutral.  It also increased its price target for U.S.-listed shares to $11.50 from $8 per share.  From Wednesday’s close that implies a 36% upside.

The demand for EV’s globally has cooled in 2024.  Consumers have obviously rebelled against the EV adoption marketing slogans & EV technology and have instead dug in their heels…sticking closely to their traditional gas-guzzling machines.

Demand in China for EV’s has been much higher compared to the U.S.  The rollout of its Mona M03 and P7 plus sedans could nearly double the company’s overall vehicle delivery from the third to the fourth quarter.

At a starting price of $US16,812.00, the Mon M03 is directed at the lower to middle-income earner.

Looking into 2025, the current estimate is that sales volume can top 300k units thanks to more new models, which is a big jump from 180k in 2024. 

Shares could see growth on the heels of the new vehicles.  When Xpeng launched its G6 sports utility vehicle in 2023, the stock advanced roughly 30%.

 

Weekly (XPEV) chart

 

The Mona M03

 

I recommended (XPEV) on March 15 this year when it was $10.05.  If you bought some shares at that time and are still holding – well done for showing patience.

For those that don’t own the shares, you can either watch the action in the shares from the sidelines or buy a small parcel of the stock over the next month.

You can see from the chart above that the stock has moved sideways since the beginning of year, which could be a precursor to a breakout rally. 

China appears to enjoy a solid position in the EV industry.   The country is now the world’s largest exporter of cars, having surpassed Germany and is even now outpacing Japan.  By destination, the EU holds the majority share, accounting for 47% of China’s EV exports in value last year; exports to Thailand, the Philippines, and India have also proved strong.  In a strong contrast, exports to the U.S. fell 32% year over year in January – October, curbed by high taxes and U.S. restrictions.  China’s automakers pay a 27.5% import duty to send vehicles to the U.S. compared with just 10% on cars sent to the EU.

 

SOMETHING TO THINK ABOUT

 

 

Have a wonderful weekend.

Cheers

Jacquie