XPENG to Expand in A-class Smart EV Segment through Strategic Partnership with DiDi
28 August 2023
XPENG Inc. (“XPENG”), a prominent Chinese smart electric vehicle (“Smart EV”) company, has unveiled a strategic partnership with DiDi Global Inc. (“DiDi”), a leading mobility technology platform, to accelerate the adoption of Smart EVs and related technologies.
As part of this collaboration, XPENG plans to introduce an all-new EV brand in 2024, currently known as “MONA”. This brand will target the mass market segment with vehicles priced at around RMB150,000, aiming to expedite the acceptance of Smart EVs and related technologies within this price range. By launching the “MONA” project, XPENG aims to enhance its production and sales growth while achieving economies of scale.
In 2024, XPENG will introduce a new A-class Smart EV model as the inaugural product under the “MONA” brand. This model and brand will differentiate themselves from XPENG’s existing products and main brand. DiDi’s involvement will support the “MONA” project through access to its extensive shared mobility ecosystem, enabling XPENG to develop highly popular Smart EV models in the RMB150,000 price bracket.
To facilitate this partnership, XPENG will issue Class A ordinary shares, equivalent to approximately 3.25% of its outstanding share capital upon completion of the issuance, in exchange for assets linked to DiDi’s Smart EV project. DiDi will subsequently become a strategic shareholder of XPENG, subject to a lock-up period of 24 months post the initial closing. Additionally, the agreement outlines performance-based incentives based on the mass production of “MONA” and sales volume targets. DiDi will receive share-based incentives based on the fulfillment of these targets.
This collaboration positions XPENG as the first automotive manufacturer to receive comprehensive support from DiDi’s ecosystem. Both companies intend to explore strategic cooperation across various domains, including marketing, financial and insurance services, charging infrastructure, Robotaxi services, and international market expansion.
Mr. He Xiaopeng, Chairman and CEO of XPENG, stated, “XPENG's A-class Smart EV products under the new brand will not only significantly increase our scale but also accelerate the adoption of our Smart EV technologies in the mass market segment, bringing our technologies to a much broader customer base.” He further expressed that XPENG will continue to pursue value creation and capitalize on growth opportunities in the mobility ecosystem and autonomous driving.
Mr. Cheng Wei, Chairman and CEO of DiDi, also emphasized the alignment of the partnership with DiDi’s mission to promote shared, electric, and smart mobility. He affirmed their commitment to collaborate with XPENG across multiple domains, with the shared goal of transforming the transportation and automotive industries.