Chinese EV maker Xpeng’s operating loss widens on costs tied to production ramp-up -November 15, 2023 at 06:45 am EST

Nov 15 (Reuters) – China’s Xpeng
posted a wider-than-expected quarterly operating loss on
Wednesday due to costs stemming from a production ramp-up,
sending the U.S.-listed shares of the electric vehicle maker
down 2.5% in premarket trading.

Smaller Chinese EV makers such as Xpeng and Nio
are trying to compete with Tesla on their home turf,
but their ride so far has been bumpy given the massive costs
involved in bolstering production and launching new cars.

Operating loss for the third quarter stood at 3.16 billion
yuan($436.33 million), compared with the estimates of 3.79
billion yuan, according to five analysts polled by Visible
Alpha. Its year-earlier operating loss was 2.18 billion yuan.

Revenue for the quarter came in at 8.53 billion yuan,
missing analysts’ estimates of 8.55 billion yuan.

The company expects deliveries in the fourth quarter to grow
at least two-fold to between 59,500 and 63,500, as it places
huge bets on the G6 sport utility vehicle, which looks to
compete with Tesla’s Model Y.

Xpeng expects revenue for the current quarter to be between
12.7 billion yuan and 13.6 billion yuan, above estimates of
12.10 billion yuan.

Chinese EV makers have been exporting vehicles to Europe
where they get higher prices on their cars than in the domestic
market. But they face the threat of higher tariffs as well, with
the European Commission seeking to probe EV exporters that
receive Chinese state subsidies.

Xpeng also reported wider net loss of 4.49 yuan per American
depositary share (ADS) for the third quarter ended Sept. 30 from
2.77 yuan per share a year earlier.
($1 = 7.2423 Chinese yuan renminbi)
(Reporting by Harshita Mary Varghese in Bengaluru; Editing by
Anil D’Silva)