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Xpeng’s Steady Climb Amid Fierce Price Cuts

Chinese electric vehicle (EV) maker Xpeng is proving to be one of the more resilient players in the increasingly chaotic Chinese EV market. In June 2025, the company reported 34,611 vehicle deliveries, marking its eighth straight month of topping 30,000 units, even as price wars and discounting spiral among competitors.

The announcement pushed Xpeng’s shares up over 2% in New York trading. While the company didn’t break down the proportion of sales between its flagship intelligent EVs and its budget-focused Mona brand, the consistent momentum puts Xpeng ahead of many domestic and global competitors who are struggling to maintain pace.

China's EV Price War: A Growing Concern

The backdrop for Xpeng’s performance is a highly saturated and aggressively priced EV market. In recent weeks, China’s electric car sector has come under fire from the central government, which criticized the industry for entering a state of “involution”—a term used to describe unproductive hyper-competition.

At a recent high-level financial and economic policy meeting, President Xi Jinping called for tighter regulation on “low-price, disorderly competition”, hinting at potential intervention if price wars continue destabilizing the sector.

Mixed Results from U.S.-Listed Chinese EV Makers

Xpeng’s American-listed peers, such as Nio, Li Auto, and Zeekr, saw uneven performance in June.

• Nio delivered 24,925 vehicles, a modest uptick from May, buoyed by newer models under its Onvo and Firefly sub-brands.
• Zeekr, backed by Geely, posted 16,702 deliveries, an 11.7% decline month-over-month and down 16.9% year-over-year.
• Li Auto delivered 36,279 units, down 11.2% from May, despite achieving 111,074 units for Q2—slightly above its downgraded forecast of 108,000. The drop followed the company’s decision to eliminate commission-sharing incentives among sales staff in an effort to reduce internal discounting.

Li Auto’s strength has long been its range-extended SUVs, which alleviate range anxiety by combining electric propulsion with small fuel tanks. However, the brand's monthly deliveries have fallen from 50,000+ units late last year, underscoring the impact of shifting market dynamics.

Tesla Struggles to Compete on Price and Volume

Tesla, which once enjoyed strong momentum in China, is now feeling the heat from a wave of competitive local launches. While Tesla raised the price of its Model 3 long-range AWD by 10,000 yuan (~$1,400) in June, the U.S. automaker saw falling sales figures.

Analysts at JL Warren Capital estimate Tesla’s Q2 deliveries in China to have dropped by 12% year-over-year to approximately 128,000 units, largely due to aggressive pricing and model refreshes by domestic brands.

Xiaomi Sparks Frenzy with Cheaper SUV Alternative

Smartphone maker-turned-EV challenger Xiaomi announced its new YU7 SUV, priced 10,000 yuan below Tesla’s Model Y, and received more than 240,000 locked-in orders in under 24 hours.

Xiaomi claims the YU7 offers superior range, though it admits Tesla maintains an edge in assisted driving technology. As of June’s end, Xiaomi’s total EV deliveries exceeded 150,000 units for H1 2025, but order backlogs now stretch over six months.

Other Players Gain Ground

Leapmotor, in partnership with Stellantis, reached a record 48,006 deliveries in June, while Aito, powered by Huawei’s intelligent systems, saw 44,685 units delivered.

Both companies are showing signs of expansion domestically and internationally, thanks to strategic alliances and a focus on intelligent driving features.

BYD Still Dominates—But Faces Mounting Competition

Despite growing competition, BYD remains China’s EV titan. The company recorded 377,628 passenger vehicle sales in June, over half of which were battery-only EVs, with the remainder being plug-in hybrids. That pushed BYD’s H1 2025 total to 2.1 million units—far ahead of competitors.

By comparison:

• Li Auto and Leapmotor both surpassed 200,000 units in the first half of 2025.
• Xpeng trailed slightly with 197,189 units.
• Nio’s H1 total was not disclosed but is expected to fall short of Xpeng’s numbers.

What Comes Next: Market Consolidation Ahead?

Experts predict a period of industry consolidation. Michael Dunne, CEO of Dunne Insights, told CNBC that BYD, Xiaomi, and Geely are most likely to emerge as long-term survivors due to scale, cost advantage, and strong tech capabilities.

He added that while Nio has excellent products and innovation, its financial troubles might jeopardize its future.

The intense discounting and uneven delivery figures across brands suggest that survival will depend not just on product or price, but also on operational efficiency and strategic adaptability in a rapidly maturing market.

Final Thought

With global attention fixed on China’s electric vehicle race, Xpeng’s consistency amidst chaos is a notable outlier. As rivals falter or realign strategies, Xpeng’s performance reinforces the brand’s growing presence in a crowded field—and perhaps signals a broader shift toward sustainable growth over price-driven battles.