Xpeng CEO He Xiaopeng has forecasted that competition within the automotive industry will intensify significantly over the next few years. In an internal letter to company staff last month, He stated that the period from 2025 to 2027 will serve as a critical phase in the industry, describing it as an “elimination round.” He further emphasized that 2025 will see an unprecedented level of competition.
“Competition in 2025 will be fiercer than ever,” He wrote, signaling the escalating pressures companies will face in the rapidly evolving market.
Xpeng, which delivered 190,068 vehicles in 2024—marking a 34% increase from 2023—continues to position itself for growth, with Vice-Chairman Brian Gu stating earlier this year that the company aims to achieve profitability by 2025. In comparison, Tesla, the world’s leading electric vehicle (EV) manufacturer, delivered 1.79 million vehicles in 2024, a slight dip of 1% from the previous year.
He’s outlook echoes earlier comments, including those made last year in an interview with The Straits Times, where he predicted that many Chinese carmakers would not survive the next decade. “From 300 start-ups, only 100 of them survived. Today, there are fewer than 50 companies that still exist,” he said, forecasting that only seven major carmakers would remain in the next 10 years.
Other executives in the auto industry, such as Mercedes-Benz CEO Ola Källenius, have also expressed concerns over increasing competition. Källenius recently stated at the Berlin Global Dialogue conference that Western automakers are facing an “existential battle” against their Chinese counterparts, describing the situation as a “Darwinistic-like price war” that will see many players fall out within the next five years.
Source: The Wall Street Journal