XPeng's new generation sales champion, will aesthetics become a major selling point?

Author | Wang Xiaojun

Editor | Chai Xuchen

XPeng's transformation is still ongoing.

On August 6th, the all-new XPeng P7 officially debuted and opened for reservations, with three models released: the 702km long-range version, the 820km ultra-long-range version, and the 750km high-performance version.

Compared to a few years ago, XPeng's capabilities have stepped up several levels this time, and the story being told is completely different. At this launch event, XPeng Motors Chairman and CEO He Xiaopeng frequently used the words "emotion" and "aesthetics." Within six minutes of opening reservations, the number of orders exceeded 1,000—without a pre-sale price or even complete parameters announced, the new P7 set the record for the fastest pre-sale in XPeng's history solely based on aesthetics and emotion.

"We used to prioritize technology first, but this year we have shifted to aesthetics first." He Xiaopeng candidly stated in an interview after the event, "If aesthetics and technology are two brothers arguing, at this stage, aesthetics takes precedence." This statement may seem casual, but it is actually a strategic shift made by XPeng Motors after gaining insights into user preferences. This pivot also reflects XPeng's recalibration of market pain points.

In 2021, the first-generation P7 became the sales champion among new forces with an annual sales volume of 60,000 units, and its NGP intelligent driving system was once regarded as a benchmark. However, technological advantages can quickly be surpassed, and there will always be more advanced technologies; XPeng needs to continuously create blockbuster models. For a long time, XPeng has faced the issue that the popularity of blockbuster models is often short-lived.

This time, XPeng hopes to let users remember more of its characteristics, thereby extending its lifecycle, with "aesthetics" being the newly chosen anchor point.

Wang Tan, General Manager of XPeng Motors' Design Center, stated that with the new generation P7, XPeng wants users to exclaim "wow" at first sight, rather than just expressing that it looks good. Therefore, during the design process, the XPeng design team proposed 1,259 design schemes and continuously refined them.

Additionally, in recent launch events, He Xiaopeng frequently mentioned emotion, summarizing: "When making cars, the left hand must have technology, and the right hand must have art; quality is the foundation, and emotion is the height."

The deeper reason lies in the changing logic of user decision-making.

Market research has found that among consumers of pure electric sedans priced between 200,000 to 300,000 yuan, exterior design has surpassed range and intelligent driving as the primary factor for purchasing a car for the first time. When competing products' intelligent driving capabilities become similar, and "technical parameter competition" can no longer directly engage users, exterior design can become the first impression for users. This is also XPeng's current logic, shifting from hardware stacking to emotional resonance.

To make this emotional perception more tangible, that evening, XPeng also invited four celebrities as ambassadors for the four major colors, with different colors targeting different consumer groups.

Interestingly, after the new car started featuring HUD, XPeng also wanted to add more playfulness to this function beyond practicality. At the launch event, He Xiaopeng introduced the new feature "Road Rage Relief." It can be seen that this feature is also based on emotional value Returning to hard technology, as the first generation vehicle with high-speed NGP functionality, the all-new XPeng P7 has also received new upgrades in intelligent assisted driving and intelligent cockpit.

The all-new XPeng P7 is equipped with three self-developed Turing AI chips, with an effective computing power of 2250 TOPS, leading globally. Two of these chips drive the intelligent driving VLA large model, giving the car the ability to understand and make proactive decisions; the other chip collaborates with the 8295P chip to drive the intelligent cockpit VLM large model.

In contrast, the new P7's central control screen features a robotic IRON-like three-axis structure that can "turn its head" to gaze at passengers based on voice commands; when switching to sports mode, the flowing ambient lights and dashboard interact to simulate track effects. These designs directly target He Xiaopeng's definition of an "emotion-awakening intelligent coupe," bringing technology from the parameter table into real-life scenarios.

However, He Xiaopeng believes that the above is only one-third of the all-new XPeng P7, with the rest to be revealed at the launch conference. For this vehicle, He Xiaopeng's expectation is to "create a model that subverts imagination, making the all-new XPeng P7 a totem for XPeng, re-entering the top three in the market for sedans priced above 200,000 yuan."

In addition to the new car, He Xiaopeng also revealed some progress in other areas of XPeng's business, such as the highly anticipated Robotaxi in the capital market, which He Xiaopeng stated is coming soon.

By the end of July this year, XPeng has sold over 230,000 new cars, making it seem not difficult to achieve this year's target. Meanwhile, another important task for XPeng is to achieve quarterly profitability in the fourth quarter, which He Xiaopeng reaffirmed in an interview that evening.

However, despite XPeng's positive outlook, the survival difficulty in the industry has not diminished at all. "The new forces in China's car manufacturing have officially transitioned from the market enlightenment stage to the second-generation cycle of deep technological iteration." He Xiaopeng's assertion reflects the harsh reality of the industry's watershed.

As the penetration rate of new energy gradually increases, leading car companies are capturing more sales, and new forces need stronger comprehensive capabilities to gain more market share.

As He Xiaopeng mentioned, XPeng needs to continue to work on technology, organization, commercialization, and globalization, making these aspects core advantages to complete the next iteration.

Below is the dialogue after the press conference between He Xiaopeng, Chairman and CEO of XPeng Motors, Wang Tan, General Manager of XPeng Motors' Styling Center, and Nick, Product Manager of the XPeng P7 model (edited without affecting the original meaning):

Q: Why did XPeng choose to launch the all-new P7 at this moment? What role will this model play in the company's future development and operations? You mentioned that with the launch of the all-new P7, domestic new car manufacturers like XPeng and Li Auto will successively enter the second-generation vehicle platform. Why do you say this is the "second-generation vehicle platform cycle," and what new characteristics does it have compared to the first generation?

He Xiaopeng: The P7 has long been our totem and has been our best-selling car, especially in 2021 and 2022.

I believe that the automotive cycle is much faster now than before; previously, a platform for a car would take about 7 years, but now many companies can produce a generation in two and a half years. I think five years is a "big generation," and in fact, many companies replace two generations of cars with a "big generation" in about five years For example, the P7 initially had a computing power of 30 TOPS and a range of 700 km. At that time, very few could achieve a range of over 600 km, but today our mass-produced vehicles have a maximum range of over 800 km. Back then, there was no 800V, no 5C, nothing at all.

I am very much looking forward to the P7 becoming the totem of XPeng again, re-entering the "top three" market above 200,000 yuan. Previously it was the "top one," but later the XPeng P7 and BYD Han rushed in to become the "top three."

With the launch of the all-new P7, I believe the XPeng P7 will re-enter the "top three" system. This is something I am very excited about. We can see that the all-new XPeng P7, whether in design, performance, intelligent driving, or intelligent cabin, is completely leading a generation compared to before. Many of our internal colleagues are particularly excited because they have really invested a lot of emotion, effort, and hard work into this project. We will definitely make the all-new generation P7 even better.

Q: Compared to the intelligent breakthroughs of the first-generation P7, what are the core technological breakthroughs of the all-new generation P7? How does it continue XPeng's pioneering spirit?

He Xiaopeng: The first is a distinctive design. We want to make it both beautiful and differentiated. To be honest, it is very difficult to achieve both at the same time. Sometimes, something beautiful cannot be differentiated, and differentiation may not look good.

For example, the highest computing power we talk about today, when "highest computing power" becomes "strongest differentiation," is very important. I have set a goal internally that, in the near future, XPeng's intelligent assisted driving should be many times higher than it is now.

Q: How do users distinguish between the P7i, P7+, and the all-new P7?

He Xiaopeng: Today we launched the new generation P7, which can actually be considered the next generation of P7i. P7+ and P7 are both part of the P7 family. These two cars are both 5 meters long; one is aimed at families, while the other focuses on aesthetics, sports, and individuality, but both are very technological. P7+ pays more attention to space and comfort, while P7 focuses more on aesthetics and sports.

Q: After the all-new P7 is launched, how will you ensure its production capacity and guarantee quick delivery?

He Xiaopeng: Our modular production is getting better and better, for example, the modularization of battery cells. This time, we will produce some cars in advance for the P7, so there will be some existing vehicles available for delivery in the future. The previous logic was to first place an order, then lock in configurations, place orders, produce, and logistics, making it difficult to accurately estimate production capacity. Now we will broadly understand user preferences in advance and produce some existing vehicles ahead of time for customers to choose from. This approach will help solve the production capacity issue in the first phase.

The first phase of production capacity is the most challenging. Because new car-making forces are very different from traditional car companies, they produce cars and sell them to dealers, who will stock up. We do not stock. Their inventory period can sometimes be two months, three months, or five months, while ours is only about 0.35 months because we want to maintain a very short inventory period. Apart from a small number of existing vehicles produced in advance, all others are produced after orders are placed. Through this cycle, we try to minimize the risks for dealers, the supply chain, and ourselves.

Q: Has the market been undergoing subtle changes in recent years regarding what consumers want? From four dimensions: aesthetics, performance, safety, and brand, how do you assess the ranking of consumer preferences for these four dimensions? How do companies weigh and negotiate?

He Xiaopeng: Today is the debut, and I mainly talked about aesthetics, covering about 1/3 of the functions, with the remaining 2/3 saved for the next press conference. In the past, automotive brands, especially mid-to-high-end cars, prioritized "brand" first; for some cars sold at lower prices, "cost-performance ratio" was first. In my view, XPeng used to prioritize "technology first," but this year it has shifted to "aesthetics first, technology leading." In the short term, we are elevating aesthetics because previously aesthetics took a backseat to technology; now aesthetics and technology are equally important, but aesthetics lead by half a step.

I believe safety is very important. XPeng is not only working on the integration of hardware and software but also on cross-domain integration research. Active safety will become increasingly important in the future. You can see why we need ultra-high computing power; for example, someone driving at 200 kilometers per hour using highway assist. Many current solutions are not safe. When we sell cars in Germany, many people are accustomed to driving at high speeds, so we need to address the safety factor of highway assist at high speeds, which requires significant computing power, even at high speeds.

Therefore, our comprehensive requirements for active safety and intelligent driving safety are continuously improving because all of XPeng's products, including Ultra, are considering globalization. I personally believe that safety and quality are fundamental; without these two, there's no point in doing anything else. But at the same time, design, technology, brand, as well as operational and business capabilities are also very important.

Question: How do you view the tribute to classics versus original design?

Wang Tan: Design itself is part of the product attributes and must align with the brand tone of the company that produces such products. (XPeng's brand tone) is about being a pioneer; we want to create innovative things that lead with technology and innovation, benefiting consumers.

With this thinking in mind, all actions and design aesthetics are executed based on this design philosophy. I believe the design of the all-new XPeng P7 aligns with "technology in the left hand, art in the right hand," which is about how to integrate emotion and rationality. From the images, you can see that the (all-new XPeng P7) has a very rational framework that conveys order, technology, trust, and safety. We even embedded all the functional keys into this framework. Outside of this framework is a dynamic and energetic curvature full of tension.

When we were designing this, we focused most on subtraction. Adding to the design is simple; you can pile on many elements, but they become unappealing and unsustainable. The challenge is to do subtraction well; you can see that the (all-new XPeng P7) has a clean profile, using high gloss to express the tension of its dynamic curvature, which conveys emotional value and is highly sensuous.

How to truly integrate emotion and rationality is the philosophy and aesthetic spirit behind our P7 design. So whether it's originality or other considerations, it must be based on the next layer of this design logic.

Question: In what ways does the all-new XPeng P7 reflect the changes XPeng Motors has undergone in the past few years? He Xiaopeng: The P7 is just a product; it mainly represents direction, positioning, styling, and technology. I think it is still far from "representing XPeng as a company."

First of all, congratulations to Nio for doing an excellent job with the L90. However, I believe the competition in the market has just begun; we are still in a "sea of blood," and we haven't even swum into the red sea yet. Whether it's XPeng or other car manufacturers, everyone is striving to swim. Returning to your topic, the P7 represents XPeng's aspiration to further elevate the design, performance, technology, details, quality, and safety based on the first-generation totem and the best classic cars.

At this new height of the (all-new XPeng P7), I believe that XPeng's overall capabilities have greatly improved compared to five years ago, including our weaknesses, mid-level strengths, and strengths. Sometimes companies are easily seen as having only strengths, but I think the other two aspects are more important: one is the weaknesses, because in the barrel theory, the weakness is the most frightening; the second is the mid-level strengths. Some companies consider 70 points as mid-level, while others think 75 or 80 points are mid-level. I believe it is also very important to raise the average of mid-level strengths. The goal of the all-new XPeng P7 is to have "no weaknesses, high mid-level strengths, and several strong points," which is what we aim to improve in our products.

Q: What do you think is XPeng's core advantage?

He Xiaopeng: Internally, I have expressed the hope that in the next two years, we can do four things well at a steady pace, which means moving a bit slower, focusing on building a solid foundation and ensuring quality.

We need to focus on four things:

First, technology comes first; I believe design is also a form of technology.

Second, the organization must be top-notch, including the team, efficiency, and collective effectiveness.

Third, we need to excel in commercialization capabilities, defining commercial products, managing commercial profits, saving money, spending wisely, and making profits.

Finally, we need comprehensive global capabilities, which is very challenging. Many people say that China's new energy vehicles are doing well and can compete globally. In fact, from a global market perspective, Chinese new energy vehicles are much better than before, but truly achieving globalization requires serious learning for 10 to even 20 years. These four capabilities are what we are striving for, and they are the four directions we hope to become super strong in; we are still on this journey.

Q: In the eyes of the public, technological intelligence seems quite hard, while emotional value is more soft. How will XPeng reflect "emotional value" in terms of technological intelligence in the future, and what are the plans?

He Xiaopeng: In fact, the "road rage emoji" is an emotional expression under technology. It first requires AR-HUD, and secondly, it needs very high computing power. If we continue to expand capabilities, we will also need higher software integration capabilities. This is why I say that traditional car companies rarely have full-stack self-research, and future car companies cannot just do full-stack self-research; they need cross-domain integration, which means combining multiple stacks when doing "full self-research." At this point, we can create many things, including truly valuable functional value, performance value, safety value, and a lot of emotional value, which makes people happy and joyful, and they will say "wow" at first glance. (It's like) telling you something very cool, which may not be that important but will make you feel happy; that makes all the difference So sometimes a very small detail, for example, in the future when you walk in front of the car, the car recognizes you, drives out by itself, opens the door for you, and says "Hello, master," of course, the second sentence is not so good, it's "Are you going to the company?" This is a kind of emotional value, which is based on technology to ensure safety and technology well. "Cross-domain integration" is emotional value. So I really believe that in the next era, as long as one has the ability for cross-domain integration and two figures out where emotional value can be generated, achieving these two will lead to better outcomes. We will continue to strive to provide more emotional value.

Q: Why are cars designed to be larger now?

Nick: This car is indeed getting larger. The actual situation is that this time the wheelbase has increased by 10mm compared to the previous generation P7, mainly considering two points. First, the previous P7 had a drawback: the rear space was not good. This time, the rear space has been improved significantly, with a seat cushion length of 513mm and 120mm of knee space, making it very comfortable for someone who is 1.8 meters tall, mainly considering the needs of family travel and previous user pain points.

Second, it considers the styling requirements, the ratio of wheelbase to vehicle length, taking into account "technology in the left hand and art in the right hand," so we have gradually optimized the dimensions together with the design team.

Q: How can Chinese new energy vehicles radiate to more overseas markets in terms of design and emotional value? Is it possible for China to lead globally in automotive design?

He Xiaopeng: Let me mention a failed case. Our first-generation P7 went overseas in 2021, and there weren't many users abroad who thought it was beautiful. I was very surprised. (We) have at least two points that differ from European users' thinking logic. First, European users believe that no matter how beautiful it is, it must be practical for family use; the trunk absolutely cannot be small. They need a huge trunk to buy a week's worth of items for one person going out. For example, I believe that all good-looking coupes in the future may need to have air suspension, which is something I have increasingly pondered in the European market.

Therefore, the emotional value of China is different from the global emotional value because emotional value is local, related to local needs, culture, perception, and thinking, so they are completely different. We should not use our emotional value to view the global market. When can China's emotional value reach the global stage? I believe that when Chinese culture, films, etc., can well go global, then it will be possible. This is a much more challenging and long-term task.

Q: By the end of this year, can we achieve comprehensive profitability by 2025? Which is better, lidar or pure vision? Or which is more suitable for the environment of Chinese consumers?

He Xiaopeng: Regarding profitability, the publicly stated commitment is to achieve the first quarterly profit in the fourth quarter of this year.

As for lidar or vision, last year everyone saw changes in our products, and not only in the current intelligent assisted driving but also in the next generation of autonomous driving, even driverless driving, we are using a fully visual (technical solution). The previous visual (technical solution) was not good because the computing power was too weak; it could not see things with enough pixel density, frame rate, or spatiotemporal logic, so it didn't work For example, in the future, can we see a nail on the road that might puncture a tire? Future vision technology can achieve that; can we see that a manhole cover has been partially moved, and the car might fall in? Future vision technology might be able to do that, but lidar has great difficulty. Therefore, the upper limit of vision (technical solutions) far exceeds that of lidar solutions. I still firmly believe that by 2027, this issue will no longer be a problem, although it may still be a problem today