XPeng's Delivery Surge vs. Tesla's Decline: Market Implications

XPeng Inc. reports impressive delivery growth, with March 2025 deliveries soaring 268% YOY. In contrast, Tesla faces declining sales in China, raising concerns for its market position. This analysis examines the potential impact on stock prices amid a competitive EV landscape.

Date: 12-04-2025

AI Rating: 7

Market Overview: XPeng Inc. has seen a remarkable surge in EV deliveries, particularly a staggering 268% year-over-year increase in March 2025, with total deliveries reaching 33,205 units. Additionally, its first-quarter figures showed an impressive 331% YOY growth totaling 94,008 electric vehicles delivered. This sustained performance marks a robust trend for XPeng, contrasting sharply with Tesla Inc., which has reported a worrying decline in deliveries within its core market of China.

Performance Against Competitors: The contrasting trajectories of XPeng and Tesla raise critical questions for investors. Tesla's deliveries came in at 336,681 units for Q1 2025, notably falling short of expectations and showcasing a 13% decrease from the previous year. Meanwhile, competitor BYD has consistently outperformed Tesla, reporting over 166,000 units sold in March alone. These trends indicate potential shifts in market share, with XPeng positioning itself as a formidable challenger in the Chinese EV market.

Impact of Tariffs: Tesla's reliance on imported components could place strain on its margins, especially as the U.S. has implemented significant tariffs on foreign-made parts. Elon Musk has acknowledged the tariff impacts, which notably affect Tesla's production costs. On the other hand, Tesla's operations in China, where local manufacturing minimizes tariff impacts, contradict this concern to some extent.

EPS and Revenue Insights: Despite its strong delivery numbers, XPeng’s Q4 2024 adjusted EPS still reflected losses of $0.20 per ADS, slightly below expectations. Revenue stood at $2.21 billion, underperforming against the $2.25 billion consensus forecast, albeit with a notable increase in gross margin from 6.2% to 14.4% year-over-year. This positive trajectory in margin, despite EPS losses, underlines XPeng’s effort to improve operational efficiency, signaling potential for future profitability.

Analyst Sentiment: Investor sentiment appears bullish on XPeng, with analysts raising price targets by an average of 14.27% to a consensus target of $22.20. This upward adjustment contrasts sharply with prior forecasts and reflects a growing confidence in XPeng's growth potential in the dynamic EV market.

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