(Yicai) Aug. 21 -- XPeng Motors is poised to enter a strong growth phase driven by the launch of new vehicle models and expects significant business expansion in China and abroad, which will bring sustainable sales growth, said co-founder and Chairman He Xiaopeng.

“Starting from the launch of Mona M03 in August, we are about to enter into a strong product cycle,” He, who is also chief executive, said in a statement to accompany the release of the electric vehicle startup’s second-quarter earnings report yesterday.

Xpeng has taken more pre-sales orders than expected for the Mona M03, a mid-end sedan priced from CNY135,900 (USD19,050), He said. The Guangzhou-based company will also release a series of upgraded versions of existing vehicle models, starting with the P7 Plus sedan.

“In the next 3 years, we will have a large number of new models and facelift versions in the pipeline for market launch,” He said.

Xpeng’s shares [HKG: 9868] finished 2.2 percent lower at HKD26.95 (USD3.46) apiece in Hong Kong today. The benchmark Hang Seng Index fell 0.7 percent. The stock has halved in value since the end of last year.

‘Powerful Product Cycle’

“Through a powerful product cycle and more efficient marketing, the technological advantages we have accumulated through a long period of time and the breakthroughs we have achieved in AI will be transformed into sales growth in China and the international market,” He said.

The new models will be sold in China and overseas through a stronger market system and bring sustainable sales growth, He noted during the firm’s earnings conference call.

In the second quarter, Xpeng delivered 30,207 vehicles, up more than 30 percent from a year earlier. The carmaker expects to deliver between 41,000 and 45,000 units this quarter, up 2.5 percent to 12.5 percent on an annual basis, He predicted.

He said he is confident about Xpeng’s delivery growth in the third and fourth quarters on a quarterly basis, with deliveries expected to hit a new high in the last quarter of the year.

Second-Quarter Earnings

Xpeng’s net loss more than halved to CNY1.3 billion (USD179.5 million) in the three months ended June 30 from a year earlier, with its gross profit margin rising to 14 percent from minus 3.9 percent, the earnings report showed. Revenue soared 60 percent to CNY8.1 billion (USD1.1 billion).

“With cost reduction through technical improvement and revenues from technical collaboration in our strategic partnership with Volkswagen, our gross profit margin in the second quarter further increased,” said Brian Gu, honorary vice chairman and co-president.

On July 22, Xpeng announced it had inked a deal with Volkswagen to jointly develop an industry-leading electrical/electronic architecture for the German auto giant’s China Main Platform and Modular Electric Drive Matrix.

Overseas sales have begun contributing to Xpeng’s growth, as they accounted for more than 10 percent of the total for the first time ever between January and July.

Xpeng, which is already present in 30 countries and regions through local dealers and over 70 self-operated outlets, plans to enter multiple right-hand drive markets, such as Australia, the

United Kingdom, and Southeast Asia, as well as double its overseas sales outlets by the end of the year, according to He.

Editors: Tang Shihua, Futura Costaglione