XPeng's CEO He Xiaopeng has stated that the company will avoid competing in the sub-100,000 yuan car market. He emphasized that XPeng aims to engage in healthy competition rather than simply producing low-cost vehicles. According to He, manufacturing inexpensive, low-margin cars holds little value. Guided by this principle, he affirmed that all XPeng vehicles must be intelligent and differentiated, with all product technologies centered around fundamental smart differentiation.

Currently, the domestic automotive market remains highly competitive. He Xiaopeng views the auto industry as a long-term marathon and a sector of enormous scale, noting that very few global car manufacturers achieve success with just two or three models. He further elaborated, "Presently, automotive companies do not represent an ideal business model but rather a fiercely competitive one. Although automakers pursue high-quality development and wish to avoid intense internal competition, we have observed in recent years that the hardware aspect of automobiles itself is not a particularly favorable business model."

Data from Cui Dongshu, Secretary-General of the China Passenger Car Association, shows that from January to February 2026, the automotive industry's revenue reached 1,482.4 billion yuan, a year-on-year decrease of 0.9%. Costs were 1,314.7 billion yuan, up 0.2%, while profits fell 30% year-on-year to 43.5 billion yuan. The industry's profit margin stood at 2.9%, which remains lower than the average profit margin of 5.8% for downstream industrial enterprises. Cui believes that, considering the downward trend in profit margins in previous years, the recent decline in automotive industry profits is still significant. Due to the clear advantages of new energy policies supported by government measures, and because mainstream automakers do not produce batteries, profit pressures on these companies are expected to increase. As national efforts to curb excessive competition continue, their positive effect on improving industry profits will gradually become apparent.

Discussing market competition, He Xiaopeng predicted that by 2030, the domestic automotive market will primarily be active with five large-scale Chinese automakers, while other manufacturers may operate on a smaller scale. However, he believes that the narrative surrounding several new electric vehicle startups will continue for many years, longer than the general public might expect.

Data indicates that in the first quarter of this year, XPeng's sales were approximately 62,700 units, showing declines both year-on-year and quarter-on-quarter. Concurrently, as new industry changes emerge, XPeng is developing further strategic ideas. In the company's vision, it aims to transform from an automobile manufacturer into a technology company. To reflect this shift, XPeng has chosen to change its corporate name from "XPeng Motors Co., Ltd." to "XPeng Group." He Xiaopeng explained that over the past decade since its founding, XPeng initially focused on smart electric vehicles, making automotive its core business. However, starting this new decade, XPeng plans to build upon its automotive operations, targeting new global physical AI domains. This expansion will include integrating areas such as robotics, Robotaxi, flying cars, and fully autonomous driving into its growth framework.