Author | Chai Xuchen

Editor | Zhou Zhiyu

Since this year, there have been voices in the market saying “Xiaopeng seems to be left behind”, but He Xiaopeng is not willing to lose, believing that this is an amplification of energy before recruitment.

On April 25, all of Xiaopeng's models were unveiled at the 2024 Beijing International Auto Show. Although all models are on sale, Xiaopeng launched the slogan “AI defines a car”, saying that to activate their product power a second time, Xiaopeng car owners should “get a new car” for free.

According to He Xiaopeng's judgment, intelligent driving will change qualitatively in 2025. “Looking at it now, it's even a year ahead of schedule, because technology is faster than I thought.” Xiaopeng, on the other hand, wants to seize this opportunity and launch a charge.

At the auto show, Xiaopeng first launched its own “Tianji System”. This is Xiaopeng's AI system connecting smart driving and smart cabin, including an AI voice assistant and more than 100 cockpit functions. This is also the first time that Xiaopeng has launched since ALL IN artificial intelligence.

Next, XNGP smart driving, supported by the “end-to-end” model, will be the highlight of Xiaopeng's AI transformation.

In an interview after the meeting, He Xiaopeng told Wall Street News that in the past, intelligent driving required a large amount of code to set rules, and even if it reached 10,000 lines, it was probably only possible to achieve 50% of the rule ability. However, with the advent of the “end-to-end” era of AI, intelligent vehicle driving has the ability to think independently. It only requires billions of dollars in training costs, and can greatly improve product performance within a year.

It is no surprise that Xiaopeng Motors, which has always been labeled a “man of science and technology,” is eager to seize this wave of AI.

Currently, with the impetus of leading giants such as Huawei and Tesla, and the rapid spread of intelligence, smart driving solution providers such as DJI and Yuanrong Qixing have set their sights on models under 200,000 yuan or even 100,000 yuan, adding another spark to this racetrack, and intelligent driving is blooming everywhere.

He Xiaopeng acknowledged that AI has the ability to once again disrupt smart cars. This is Xiaopeng's next big move to turn the market around. As a result, he will gather another 4,000 new recruits to attack this track, and the organization will completely change for this reason.

Next, while refining AI technology, Xiaopeng also plans to speed up product promotion; this year, Xiaopeng will “delegate” AI capabilities to the 200,000 yuan A-class model “MONA”, which will take on the heavy responsibility of driving.

In addition to the product layout, Xiaopeng will also increase its overseas strategic strength and use the advantages of popular cooperation to expand the coverage of the international market from the current 3 countries or regions to more than 20. He Xiaopeng stressed that in the future, domestic and foreign revenue should be “five five open”.

He Xiaopeng, who is betting his turnaround chips on AI and overseas markets, believes that in the fourth quarter of this year, Xiaopeng Motor's positive cycle will begin.

The following is a transcript of his conversation with Ho Xiaopeng (edited):

Q: In the past quarter, Xiaopeng's sales were poor. When can it return to the monthly sales figure of more than 20,000, and when can gross margin return to double digits?

He Xiaopeng: In fact, there was a lot of change in the past year. The previous consideration was scale first; later, the logic was to survive the knockout tournament, if the Polygon Warriors were first in scale and leading in scale.

My opinion on the knockout tournament is different from that of many people. I don't think that if you have more than two or three thousand cars a month and get several places in the rankings, you can survive. I think cars are good in situations where there are many omnipotence situations.

This year, Xiaopeng will be tens of percent larger than the previous year, strengthen operations several times, and truly relate AI capabilities to customer service experiences. These are all the technical core of Xiaopeng's ability to take off. I believe that after the arrival of the new AI era, our transformation will go the best.

Q: The industry is booming. What do you think about the second half of intelligent cars, and in what areas will you deal with it?

He Xiaopeng: First, we aim to increase investment in the AI field. This year, we aim to increase the number of relevant personnel, mainly focusing on the integration of AI and automotive technology; second, we plan to expand the scope of AI applications from A-class cars to B-class cars. Currently, Xiaopeng is mainly deeply involved in the B-C class car market; third, we are undergoing organizational changes, hoping to build a company with a similar canopy structure, with more than a dozen product lines, and plan to launch it within the next few years.

Many people think that Xiaopeng has changed too drastically. In fact, people don't have a clear understanding of the knockout competition. For example, if some cars lose 25%-30% of sales every year, then their products will also change, so we need to change a little earlier.

My overseas goal is a long-term goal, not to sell many products in a short period of time. Xiaopeng insisted on autonomous driving. No one believed it ten years ago. He insisted on flying cars, and no one believed it ten years ago, but next year, many people will start believing in autonomous driving, and after 3-4 years, flying cars will actually be used by people.

Therefore, we need to have technological insight to see the cutting edge, live patiently until that day, have the ability to live well, and do all three things well. We look forward to integrating knowledge and action in China and around the world.

Q: The price war has been particularly intense in the past two years. When will this round of price wars end? What is the current price reduction logic?

He Xiaopeng: Regarding the price war, I think there are two core logics. First, profit is the deciding factor. As long as the profit of fuel vehicles remains at a reasonable level, the price of fuel vehicles will not be easily reduced. Second, with the continuous development and popularization of smart car technology, smart cars and fuel vehicles will tend to be consistent in price in the future. When the price of smart cars is comparable to fuel vehicles, and the latter is reasonably profitable, the entire industry will usher in huge changes.

As smart cars provide disruptive user experiences, their market penetration rate is expected to increase dramatically from the current 50% to 90%, driving the rapid evolution of the industry. Furthermore, in the past, the industry mainly relied on hardware, but now more emphasis is placed on the combination of hardware and AI technology. Large model technology has helped many brands, including Xiaopeng, to make great progress in the field of autonomous driving. This technology is no longer an unattainable dream, but an actual result that has already been applied.

We expect that by 2027, the number of car companies in the market will be drastically reduced. At that time, everyone will see more advanced AI, better hardware equipment and higher quality products, and the entire industry will enter a stable stage. Meanwhile, Xiaopeng has made many changes in the past year, and is expected to usher in a huge leap in development in the fourth quarter of this year.

Q: I just mentioned that Xiaopeng Motor's end-to-end technological progress is very cutting-edge. What are the nodes that can be opened throughout the country?

He Xiaopeng: Since last year, Xiaopeng has been working on it. It has now begun public testing, and plans to officially release the end-to-end solution to the public next month. The core of this solution is to successfully run the model and implement some functions. Our goal is to be able to open in most parts of the country and even within the community by this year.

Currently, many companies claim that they can provide services nationwide, but in reality they still rely on high-resolution maps. Seemingly fast, high-precision maps currently only cover less than 1% of the country's roads. When the vehicle drives from road A to road B, the service will be interrupted immediately without the support of high-precision maps. Only by completely getting rid of the dependency on high-resolution maps can they be applied in mixed scenarios.

Intelligent driving will change qualitatively in 2025. Now it's even a year ahead of schedule because technology is faster than I thought. With the advent of end-to-end technology, we only need to invest billions of dollars in training costs to significantly improve product performance within a year, which will greatly accelerate the spread of autonomous driving technology in actual applications.

Q: I just mentioned that MONA will take the next step in June. It has AI in its name. What actions will this car make intelligent in the future?

He Xiaopeng: We have always wanted to make an A-class car. This car will be the size and price of an A-class car, and also has very good performance, good looks and AI capabilities.

As I mentioned in the past, no one can drive an A-class car fully autonomous like Xiaopeng. I think after 4-5 years of research and development, MONA will bring everyone a completely different new brand experience.

As a new brand, MONA will have many cars. The first car is very cool, suitable for young people who have just graduated, and is highly intelligent.
Q: Can you tell me about Xiaopeng's trip to sea?

He Xiaopeng: We are a high-end brand overseas, and we don't want to follow the cost-effective route. I hope Xiaopeng's image overseas is still a technology company, bringing intelligent and ultra-fast charging technology to the past.

In the past few years, Xiaopeng has launched a limited number of models in the Chinese market, one every year, and overseas markets are even scarce. Starting in the second half of this year, we will speed up the launch of models and plan to introduce some models to overseas markets. The scope of exports will be expanded from the original 3 countries to more than 20.

I think any good car company in China must establish a strong brand overseas to have an opportunity. I hope that half of Xiaopeng's future income will be in the world and half in China.

Q: After the launch of Xiaomi Auto, there was a lot of buzz. Did Xiaopeng exchange and learn about marketing with Mr. Lei?

He Xiaopeng: We communicate a lot, but some of our abilities are gifted and not easy to learn. I think Mr. Lei's marketing ability is better than mine, but I want to be better than him in terms of technical ability. Every company needs to find its own roots and genes, and we are also drastically improving our marketing capabilities. The results in the last two months have been very obvious, but they are not enough.

Q: What is the most important thing for Xiaopeng Motors this year? In addition to technology and products, what other achievements does Xiaopeng Motor need to achieve now?

He Xiaopeng: We need to improve the five lines internally: the first is the organizational line, including people and management; the second is the entire big product line, including users, customers, commercial products, and how to do product marketing well. These are the two most core aspects. The other three competencies are how to do a good job in management, how to improve customer experience, and how to think globally.

Getting these five lines right, I think it's very important for Xiaopeng to win the knockout tournament. All of our organizational changes, capacity changes, etc. revolve around making the company a better place in globalization.