Xpeng Motors confirmed with TechNode on Wednesday that it is facing delivery delays caused by an ongoing supply crunch in lithium iron phosphate (LFP) battery packs, as customers of the Chinese electric vehicle maker are reportedly frustrated over months-long waits for their new cars.
Why it matters: Xpeng is the latest Chinese automaker to feel the sting from the supply chain shortage of both semiconductor chips and key battery materials.
- The EV maker in late October began delivering its second sedan model, P5, without millimeter-wave radar units due to the shortage of radar chips. Xpeng promised owners it would install the components by next March.
Details: Xpeng said that it has apologized to customers who experienced significant delays after ordering its flagship P7 sedan. It is currently ramping up to ensure the lower-end P7 deliveries are made no later than next February, state-backed Shanghai Securities News reported Wednesday, citing a company representative.
- Xpeng will also cancel the orders and refund down payments if requested by customers, the spokesperson said, adding that deliveries of the entry-level version of its P7 sedan, which has a driving range of 480 kilometers (298 miles), would be delayed up to 17 weeks.
- Several customers complained that the Alibaba-backed EV maker deliberately intends to prioritize deliveries of higher-end versions of P7, according to a post published Monday on “Black Cat,” a complaint platform owned by Sina. The P7 allows for a driving range of up to 670 km.
- When contacted by TechNode on Thursday, an Xpeng spokeswoman responded by calling the post’s accusation “factually wrong” and that the company “didn’t prioritize deliveries of the high-end P7.” The higher-version P7 models are equipped with the conventional cobalt lithium-ion batteries that guarantee more power and range than LFP batteries, the spokeswoman noted.
Context: Xpeng delivered 56,404 vehicles during the first three quarters of this year, a figure four times higher than the 14,077 vehicles it placed with customers during the same period in 2020. It set a delivery forecast of up to 36,500 vehicles for the last three months of this year.
- Speaking to analysts during an earnings call on Nov. 23, President Brian Gu said the company was aiming to hit a monthly delivery of 15,000 vehicles over the next two months, although he expected the supply chain constraints to remain “very severe.”
- Xpeng rival Nio on Nov. 10 predicted its fourth quarter deliveries would number between 23,500 and 25,500 vehicles, as chief executive William Li said during an earnings call that the company’s delivery volume was constrained by supply chain volatilities with regards to certain chips and batteries.
- Li added that the company is currently ramping up battery production with partner CATL and expected production volume to reach “a reasonable level” in the first quarter of 2022. Nio delivered 24,439 vehicles in the third quarter of this year, an 11.6% increase from the preceding quarter.