In the past year, Xiaopeng Automobile has been busy making amends.
Recently, it was reported that after Li Feng, Vice President and Head of Procurement Department of Xiaopeng Automobile, was suspended for investigation, Liu Yongjie took over Xiaopeng's procurement department. On October 23rd, insiders of Xiaopeng Automobile confirmed this news to Pengpai News reporters and stated that Liu Yongjie had extensive work experience in automotive supply chain enterprises before, and currently holds the position of Supply Chain Management Director internally.
Two weeks ago, it was reported that Li Feng had been suspended due to involvement in an internal anti-corruption investigation. Xiaopeng responded to the surging news reporter that the company's action is a normal anti-corruption and integrity building behavior. For any corrupt behavior, if discovered and corrected together, we will not tolerate it. This incident involves a small area and does not affect business or production processes.
The internal corruption issue of Xiaopeng this time is actually a long-standing root cause. An insider from Xiaopeng Automobile revealed to a reporter from Pengpai News that this internal anti-corruption campaign is related to the high cost of parts procurement for Xiaopeng Automobile before.
Previously pointed out by partner Volkswagen that the cost is too high
Xiaopeng Automobile CEO He Xiaopeng himself is candid about the internal organizational management issues of Xiaopeng Automobile.
The cooperation with Volkswagen not only restored the confidence of the outside world in Xiaopeng Automobile, but also made He Xiaopeng realize his insufficient capabilities in the automotive supply chain field. At the press conference of the facelift Xiaopeng G9, He Xiaopeng said at the beginning that after reaching a cooperation with Volkswagen, Volkswagen evaluated the Xiaopeng G9 as "very solid technology, not an excellent cost".
In the subsequent communication process, He Xiaopeng was no longer reserved. He mentioned that before reaching a long-term strategic partnership with Volkswagen, Volkswagen dismantled the Xiaopeng G9 and found that "this thing is 25% more expensive, and that thing is more than ten% more expensive". It is not difficult to see from He Xiaopeng's words that internal problems have become a major concern for him.
What made He Xiaopeng realize was the serious procurement problem, as well as Wang Fengying, the CEO of Xiaopeng Automobile. On January 30th this year, Wang Fengying, former Vice Chairman of Great Wall Motors, became the President of Xiaopeng Motors, fully responsible for the company's product planning, product matrix, and sales system.
He Xiaopeng stated that Wang Fengying has been a veteran of the automotive industry for over 30 years and has numerous detailed questions that she can easily understand. For example, the cost of seats in Xiaopeng Automobile is 1200 yuan, which features are unnecessary to use, how much leather coverage can be reduced without affecting the consumer experience, and so on; Another example is that car shipping to sea was originally the cheapest way to use ro/ro ships, but the relevant personnel insisted on using containers, which cost 70% more. However, Wang Fengying could see the problem and insisted on using ro/ro ships.
Repeated patching has a negative impact, and the industry is looking forward to Xiaopeng's "nirvana"
He Xiaopeng has won the praise of many people by openly bringing the "family clown" to the table. But after all, Xiaopeng Motors is not Tesla, nor is He Xiaopeng Musk.
Zhang Xiang, the director of the New Energy Vehicle Technology Research Institute of Jiangxi New Energy Technology Vocational College, stated that this type of corrupt behavior is actually common in many enterprises, but it can still have negative impacts when spread. Consumers may believe that Xiaopeng's internal management is not standardized and has loopholes, which may lead to the loss of some users. However, he also mentioned that from the precedents of other car companies, this negative impact is short-term and consumers will gradually forget.
In addition, the industry is also concerned about the effectiveness of Xiaopeng Automobile's aggressive "patching".
In October 2022, shortly after the launch of Xiaopeng G9 and its disastrous Waterloo, Xiaopeng Motors embarked on a massive organizational restructuring. Starting from February this year, all design teams, research and development teams, production teams, and supply chain teams, as well as organizational management teams and process management teams, of Xiaopeng Automobile have directly reported to He Xiaopeng, in order to improve planning ability, decision-making efficiency, execution efficiency, and reduce the cost of the entire chain.
In this organizational restructuring, Xiaopeng Automobile's original three procurement departments, Supply Chain Service Department, Marketing Service Procurement Department, and Parts Procurement Department, were merged and entrusted to Li Feng to achieve cost reduction and efficiency increase. However, ironically, as soon as the cost reduction "patch" was completed, another anti-corruption "patch" was backhanded.
As previously mentioned by Li Xiang, CEO of Ideal Automobile, the adjustment of internal organizational structure will affect performance. Since the end of 2022, Xiaopeng Automobile's performance has significantly declined, losing its position as the new sales champion and putting pressure on its gross profit margin. The industry is also looking forward to the results of repeatedly 'patching'.
In the second quarter of this year, Xiaopeng Automobile suffered losses that exceeded market expectations. According to the financial report, Xiaopeng Automobile's revenue in the second quarter was 5.06 billion yuan, a year-on-year decrease of 31.9% and a month on month increase of 25.5%; The net loss was 2.8 billion yuan, an increase of 3.8% year-on-year and 20% month on month, exceeding the market's expected net loss of 2.171 billion yuan; The gross profit margin of automobiles in the second quarter was -8.6%, 9.1% in the same period of 2022, and -2.5% in the first quarter of 2023.
However, Xiaopeng Automobile's sales are clearly recovering. Delivery data shows that Xiaopeng's sales reached 15300 units in September, a 12% increase compared to the previous month and an 81% increase compared to the same period last year. It has resumed growth for 8 consecutive months; The cumulative delivery volume in the third quarter was 40000 vehicles, an increase of 72% month on month.
Multiple institutions have analyzed that Xiaopeng Automobile's performance in the second quarter has reached a bottom, stating that it is expected to break through the "darkness before Li Ming" and "reduce costs and increase efficiency to bring dawn of recovery" in the third quarter. He Xiaopeng has revealed that 20000 vehicles will be delivered in the fourth quarter of the impact month.