Morgan Stanley released a research report stating that sentiment for XPENG-W (09868) is expected to improve significantly from mid-2026, when the company begins mass production of its physical AI project. The report noted that while the auto business will remain XPeng's primary revenue driver in 2026-2027, its non-auto segment holds greater growth potential over the next 3-5 years, offsetting intensifying domestic competition and potential discounts in the EV sector amid market saturation. The bank raised its H-share target price for XPeng from HK$119 to HK$131, maintaining an "Overweight" rating.

Management expects the auto business to achieve breakeven in Q4 2025, providing stable cash flow to support new projects like humanoid robots and "L4-level Robotaxi." They highlighted high synergy between autonomous driving and humanoid robot R&D teams, with 70% shared R&D investment. Following its July 2023 collaboration with Volkswagen, XPeng is further opening its ecosystem to seek strategic partnerships in humanoid robotics and Robotaxi. The company has already announced a partnership with AutoNavi to provide Robotaxi services, with more collaborations expected within 12 months ahead of planned mass deployment by late 2026.