XPeng's Biggest Launch Ever - Is Europe the Next EV Battleground? | China EVs & More #254

XPeng just held the biggest launch event in company history—and they chose Munich, Germany, the heart of Europe's automotive industry.

In Episode #254 of China EVs & More, Tu Le and Lei Xing break down XPeng's global launch of the new MONA L03, why Europe has become the next major battlefield for Chinese EV makers, and what this means for Volkswagen, BMW, Mercedes-Benz and the rest of the legacy auto industry.

The discussion covers XPeng's pricing strategy, autonomous driving ambitions, Google Maps integration, charging infrastructure investments, software licensing opportunities with Volkswagen, and whether Chinese automakers are entering a new phase of global expansion.

They also examine:

• Why Munich—not Shanghai—became XPeng's biggest event ever
• How the MONA L03 compares with the Volkswagen ID.4, Tesla Model Y and BYD Atto 3
• XPeng's plans for advanced driver assistance across Europe
• Why BYD continues raising the bar globally
• Could Volkswagen eventually manufacture XPeng vehicles?
• The future of software-defined vehicles and AI-powered driving
• Bill Ford's comments about competing with Chinese automakers
• Why Europe may become the proving ground for autonomous driving before the United States

If you want to understand where the global automotive industry is heading—not where it has been—this is an episode you won't want to miss.

Subscribe for weekly analysis of the global EV, autonomous driving and mobility industries from two of the most experienced China automotive analysts anywhere.

Chapters

00:00 Introduction & Welcome

01:00 Lei reports live from XPeng's biggest global launch in Munich

03:05 Why launching in Volkswagen's backyard matters

04:35 XPeng MONA L03 pricing: Europe vs. China

06:15 XPeng's autonomous driving strategy for Europe

08:00 Google Maps, AI and XPeng's global software stack

09:45 Why Europe is becoming the autonomous driving battleground

11:25 Is XPeng taking direct aim at Tesla and Volkswagen?

13:00 XPeng's charging infrastructure plans for Europe

15:15 Can the L03 become XPeng's next blockbuster?

16:45 Why Paris Motor Show just became much more important

18:00 Will Chinese marketing strategies work in Europe?

20:20 Can XPeng succeed in 65 global markets?

22:05 XPeng's global expansion challenges beyond China

24:10 Europe could become the proving ground for AI driving

25:20 Could Volkswagen build XPeng vehicles?

26:30 Is software licensing the next big opportunity?

27:30 Why BYD deserves credit for paving the way

29:00 Bill Ford admits Chinese automakers can't be ignored

31:20 Volkswagen's future and BYD's race to become the world's #1 automaker

35:15 China's slowing auto market and what it means for global OEMs

37:20 Live audience Q&A

38:00 Is the U.S. really closed to Chinese automakers?

39:15 XPeng's X9 recall explained

43:00 Are XPeng and Tesla becoming true rivals?

45:30 Toyota vs. BYD: Can BYD really become #1?

47:45 The future of battery swapping and autonomous charging

49:45 Closing thoughts & next week's preview

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China EVs & More

Tu Le

Lei Xing

Sino Auto Insights

Transcript

Tu Le (00:00)
 Welcome to the Munich and Detroit edition of China EVs and More. In the next hour or so, my co-host Lei Xing and I will go over the week's most important and interesting news coming out of the global EV, AV and mobility sectors. What Lei and I discuss today.
 
 is based on our opinions and should not be taken as investment advice. My name is Tu Le. I am the Managing Director at Sino Auto Insights, a global management consultancy that helps organizations bring innovative and tech-focused products and services to the transportation and mobility sectors. I write a free weekly newsletter that we pull many of our discussion topics from. You can sign up for it at sinoautoinsights.substack.com, which of course, I encourage you to do a...
 
 Guten Tag, Lei. Can you please introduce yourself?
 
 Lei Xing (00:51)
 Guten Tag Lei
 
 and good afternoon Tu This is your co-host Lei Xing, former chief editor of China Auto Review and coming to you live from Munich. Episode 254,
 
 Tu Le (01:02)
 Did you miss me? Should I have come?
 
 Lei Xing (01:04)
 You should have come. it's I don't even know where to begin because we always say at the top of the show the news coming out of the global EV, AV mobility sector. This felt like the only event really worth mentioning because of the significance of it being, my first ever
 
 event attending a Chinese EV brand's global launch outside of China.
 
 my first and I'm actually on China time. So the last few days I've been,
 
 Tu Le (01:38)
 And one, and one.
 
 Lei Xing (01:41)
 and the beer, but tonight will be fine. I'm looking forward to finally some cold beer. Cause last few days has been busy and not like really relaxing, relaxing, you know, just beer and talk about really Xpeng
 
 Boy, you missed a lot of things. I wish you were here. I definitely wish you were here. You should have been here. I know.
 
 Tu Le (02:02)
 Man, too many things going on. Honestly, was told what
 
 1600 guests 600 media.
 
 Lei Xing (02:09)
 So.
 
 Tu Le (02:09)
 I just seems like a lot.
 
 Lei Xing (02:12)
 So
 
 the way the event was held, basically there was a pre-conference, press conference show the night before at a kind of a warehouse. And yesterday the press conference was held at this location called Showpalast right next to the Allianz Stadium where the FC Bayern Munich plays soccer, football.
 
 This is one of the venues I hear it's the biggest theater opened in Munich in 100 years.
 
 And yes, the capacity was full. think it was at least 1,500 people. It's the biggest event for Xpeng this year, bigger than the Beijing Auto Show. the biggest product launch in the history of Xpeng because of the current landscape, the industry, the global industry, what's happening in China, the competition, the involution. And we're in the heart of the European auto industry.
 
 Tu Le (03:09)
 You're in BMW's backyard.
 
 Lei Xing (03:12)
 we're
 
 in the BMW Group's backyard. So any way you look at it, it's one of those events where it's almost like putting salt on the wound of the German automakers. But He Xiaopeng actually has shown a lot of humility in the
 
 press conference and interviews afterward. One of things he said, my industry in China, we're still a student. And Volkswagen is our shareholder. They're on the board and they're teaching us or they're showing us in terms of management, in terms of their German.
 
 engineering knowledge. And they want to just there was an interesting in the interview somebody asked. Yeah.
 
 Tu Le (04:02)
 Well, let me stop you there. Let me stop you there.
 
 You and I know because we're Asian, that's giving someone face. Whether or not they deserve it, that's giving Volkswagen face. Get tamen mianzi, right? So I think it's respectful and that's fine. I also think that there's some ironies to
 
 to him saying that being in Germany launching this vehicle aimed directly at the mass market Volkswagen branded vehicles. So the double-edged sword.
 
 Lei Xing (04:33)
 Yeah, just to
 
 give you an idea, I kind of call it the half Model Y or the half YU7. But the competitors that Xpeng showed is basically the Volkswagen ID.4, the Skoda Elroq, and the BYD Atto 3. That's their official comparison models. But.
 
 The Mona L03, it's definitely smaller than the Model Y. It's smaller than the G6. I think the pricing is one of the things that stood out to me because at the press conference, the pricing was announced for the Germany market and also seven other European markets. And on the live stream, they actually added a component of the China price announcement.
 
 which was not shown live at the event. And I actually didn't see it until later in the evening. I was expecting the price to fall into the 130,000. Well, guess what? They launched the Plus version at RMB123,800 $18,000. Now granted, that's the one that does not have the Turing chip.
 
 Only the Max and the Ultra SE versions has it. you have a discrepancy of pricing. $18,000 starting price in China. German starting price 35,600 euros. It's double. But from what I'm hearing that 35,000 euro from some of the media.
 
 is a good point for this type of vehicle with the pending approval of the VLA, which they have to meet this DCAS regulation that's going into effect end of this year. One of the significance is that this model should become, well, Xpeng claims to be the first
 
 Chinese OEM to offer advanced highway urban assisted driving outside of China in Europe once they get approval for this new rule, which is a United Nations rule, which means you don't have to go into individual countries for approvals. Once you get this approval,
 
 you can start using this NGP VLA 2.0 in Europe. So that's something that we can look forward to perhaps in Q1 of 2027.
 
 Tu Le (07:14)
 With those only with the Turing trip being able to use NGP.
 
 Lei Xing (07:18)
 Right,
 
 yeah, also important to mention, only the Ultra version will have this, which is the top version, which has three Turing chips, two for the smart driving, and one for the smart cockpit.
 
 Tu Le (07:32)
 One thing
 
 stood out to me that I'd mentioned this since kind of day one is that XPeng is using Google Maps as its global partner outside of China for its intelligent driving and its GPS. So this is part of that bifurcation where...
 
 they're going to have a stack for China and they're going to have a stack for the rest of the world. This also helps them take a large step towards entering the US market.
 
 Lei Xing (08:02)
 Yes, because
 
 again, that UN regulation is a global regulation. So theoretically, the capabilities of the VLA 2.0 is actually the same everywhere in the world. But in Europe, you have to meet this UN regulations DCAS, which has a requirement on safety, has a requirement on data security, privacy.
 
 stuff like that. And the Google Maps, remember Xpeng is notorious for the first one to offer high-def map in the early days. Also the first one to take out the high-def maps. They are the first one to offer lidar on the P5. Who still remember the P5? And they're the first one to take out lidar to become vision-based.
 
 This Google Map integration, basically, they don't need that for the autonomous driving. But it's required for the local European consumer habits of points of interest, kind of supporting the VLA and NGP. But it's not required. But it's critical,
 
 That's what He Xiaopeng says in Europe for Europe.
 
 Tu Le (09:23)
 So I don't know too much about these UN requirements, but I think it's still going to be a country by country. Maybe not so much in the EU, but in United States for sure. If and when the Chinese do come to US roads, there's going to be additional requirements outside of these UN requirements. If the US decides they want to use the UN requirements, if at all.
 
 Lei Xing (09:47)
 Yeah. And the jarring thing is, you know, I in the past, when I was at China Auto Review, I used to attend these events from the German premiums. They would invite media from China to come to Germany, to come to Europe for these tech events. And now it's the Chinese brands inviting global media to Europe outside of China.
 
 I
 
 have these flashbacks, How the tides have changed. You mentioned at the beginning of show.
 
 And in the backyard, under the backdrop of German automakers,
 
 horrendous sales, not only in China, but globally.
 
 Tu Le (10:25)
 shameless
 
 plug, Joe White and I, who is a retired Reuters and Wall Street Journal journalist, he and I did a deep dive because I wanted to ask him about, he had written a book about GM's failures in the 80s. And I wanted to compare and contrast what's going on with Volkswagen with what happened with General Motors. So for those interested in understanding and deep diving a little bit more on the Volkswagen thing.
 
 we did a show this week.
 
 This has to be...
 
 pretty bittersweet. The specs that stand out to me and quickly summarizing them is it's 40,000 euros, cha bu duo (almost), starting in Europe. It's 20,000 starting in China. It's already being compared price-wise to the Model Y. So it's 10,000 euro less expensive than the Model Y.
 
 To your point, it's a smaller vehicle than the Model Y. We knew the Model Y was going to be overpriced. It's already overpriced in Europe just because there's nothing new coming out of it. And now that XPeng has kicked this door open, you're gonna really see BYD get more aggressive because this is the same week or the week after Stella Li reaffirmed Wong Chuanfu's
 
 kind of goal of being the number one automaker. Now Stella Li had said within five years, Wang Chuanfu said by 2030. And
 
 Lei Xing (11:55)
 Mm-hmm.
 
 Tu Le (11:56)
 in the newsletter, kind of articulated out what it would take to get
 
 Lei Xing (11:58)
 I saw it.
 
 Tu Le (12:01)
 to 10.5 million units. And this is not going to help. Vehicle launches like this at 40,000 euro is not going to help. One thing that before I give it back to you, Lei,
 
 that is a little bit confusing to me right now that I'm not clear on.
 
 Lei Xing (12:18)
 Mm-hmm.
 
 Tu Le (12:19)
 The BEV and EREV in China starts at the same price for this LO3. There's a branding thing that's different from China and the rest of the world. It's an Xpeng LO3. In China, it's an Xpeng MONA LO3. And then currently, although that could be changing, there's a tariff.
 
 on BEVs, but not EREVs and PHEVs. And so do they eat that additional tariff on the BEV to keep pricing the same or how does that adjust for the European market?
 
 Lei Xing (12:54)
 So actually the EREVs are priced slightly higher than the BEVs in Europe and they're only offering the EREVs I think in the seven countries listed were Germany, Netherlands, Belgium, Sweden, Austria, Norway. Actually Norway, the starting price is 27,000 euros equivalent.
 
 So actually there's a kind of a gap depending on the country,
 
 Tu Le (13:28)
 So logic would tell you that the BEV should be more expensive because there's a tariff on the BEV, but they've
 
 Lei Xing (13:34)
 Right.
 
 Tu Le (13:35)
 priced it cheaper. The other thing that stood out to me, is that like BYD, they're going to invest in charging infrastructure because it's a 3C BEV. So it has charging speed of 3C.
 
 Lei Xing (13:50)
 Yeah,
 
 so also important to stress, this is a 400 volt platform, which is by design because it charges 10 % to 80 % in 20 minutes. And something that He Xiaopeng said was interesting, the charging part of it, they want to build 4,000 stations (points) by 2028.
 
 Something he said in an interview is that he believes the future will be autonomous charging. They want to do that. And I think it's almost like matching maybe what NIO's battery swapping is able to accomplish, doing things automatically. And then they also talked about megawatt charging, the next generation, with the energy storage.
 
 next to it
 
 back to the humility part of He Xiaopeng, right? He spoke entirely in his Hubei accent English. The night before, he says something that we want to be in Europe and it's a 10 year, 20 year journey.
 
 So he understands, right? I've been here three days. You count the number of EVs on the roads from China, the Chinese EV brands. Certainly a lot of BYDs, some LeapMotors, MGs, Xpengs here and there. A lot of BMW iX3s. This is BMW country.
 
 Tu Le (15:17)
 Those are company cars.
 
 Lei Xing (15:19)
 Yeah.
 
 Same as you see a lot of NIOs in Shanghai, right? So there's that regional discrepancy. But anyhow, this event, the biggest event being that this model has the potential to become the next biggest volume driver for Xpeng. And can it replicate the success of the MONA MO3? The market environment is different than two years ago.
 
 But it's shaping up to be, yeah.
 
 Tu Le (15:45)
 Well, the market is different too.
 
 Let's be clear, the market is different. We're talking about Europe versus China.
 
 Lei Xing (15:51)
 But the expectation is being an SUV, being that it's launching in 65 markets this year. China pricing, yeah, coupe. They
 
 Tu Le (16:00)
 It's more of a crossover, more of a crossover than an SUV. Like, model Y is more of a crossover.
 
 Lei Xing (16:07)
 call it the AI SUV coupe, coupe. The price point it's at in China, it got 48,695 firm orders.
 
 within
 
 the first hour. And of all the Xpeng models launched previously, this one has received the most orders in the same amount of time.
 
 Potentail is there to be a blockbuster. the event I could think about is so huge that I don't know how much they spent, the budget that they spent on this, global media, separate events at separate locations, renting out studios for static filming.
 
 Tu Le (16:46)
 The really
 
 important thing is that this is precedent setting, as you'd mentioned, and that raises the stakes for Chinese companies for the Paris Moto Show. And I'm talking to you directly, Li Auto, because you will be showing off your vehicle for the first time to European markets. So...
 
 You have a floor now. I'm not saying that you need
 
 Lei Xing (17:12)
 What? Yeah.
 
 Tu Le (17:13)
 to rent out all these different places, but if you're going to go into Europe with a whisper, You voice will be drowned out by other Chinese automakers.
 
 Lei Xing (17:25)
 event
 
 is only a sign of things to come for Chinese EV brands. Expect Xiaomi to hold similar event, if not bigger.
 
 Tu Le (17:34)
 I will go to that. I will go to that one. You know, one thing that,
 
 Lei Xing (17:34)
 Within a year's time. Within a year's time. Yeah. The auto certainly...
 
 Tu Le (17:42)
 you know, one thing that I questioned a little bit is that.
 
 Xpeng had this massive event and I just don't know. It's kind of a flood the zone mentality. The China mentality into Europe, I don't know how.
 
 That's going to work. Is it because there's a law of diminishing returns and you still need to position this vehicle. You still need to build trust. You still need to create awareness. The price point certainly makes it more attractive than others, but at 40,000 euro it's not cheap. It's not $20,000 cheap. So there will be
 
 Lei Xing (18:21)
 Hence the humility.
 
 Tu Le (18:22)
 competitors, so there will be competitors.
 
 And you know, 65 countries, but there's probably five or six that matter from a volume standpoint. And it's still right. Exactly.
 
 Lei Xing (18:32)
 Well, China being won. Still.
 
 Tu Le (18:36)
 And so if sales stall in China, it creates even more pressure for it to be successful outside of China. and we know that I don't know how you define success, but if you're
 
 In the top, once you launch for the six
 
 Lei Xing (18:50)
 So here.
 
 Tu Le (18:51)
 months or seven months, you're doing pretty well.
 
 Lei Xing (18:54)
 sold numbers. MONA MO3 sold 280,000 units in less than two years. If LO3 does that, I will call that a success. If it doesn't, probably not. That's how much expectations.
 
 Tu Le (19:06)
 Because, well,
 
 that would mean, Lei that probably about half of XPeng's capacity is taken up by two cars. the M03 sales have dropped. But let's say they have a million units of capacity. And I'm guessing. So at 250, and you're talking over two years, but.
 
 Let's assume because this is an international launch that there's going to be some incremental sales that matter for the LO3. Is it LO3 or L03? L03. Yeah, OK.
 
 Lei Xing (19:40)
 The other number is MONA MO3 averaged 13,000 units a month. Supposedly the L03 should do as much being an SUV, being a crossover.
 
 Tu Le (19:55)
 Yeah,
 
 I think it'll do maybe 1.3, 1.4 to 1 ratio. So for every one, MO3 is sold, 1.4, LO3s are sold. So you put that into a spreadsheet.
 
 Lei Xing (20:06)
 So we can kind of
 
 look at these numbers by the time the Munich Auto Show comes around in about a year's time of how the L03 has done. Then we can make a verdict. But now the potential, the expectations are through the roof for this model.
 
 Tu Le (20:27)
 it's very well appointed for 40,000 euro. So it is definitely going to create a much more value proposition for European buyers.
 
 And the fact that...
 
 two companies are announcing that they're investing so heavily into charging infrastructure into Europe, it shouldn't be lost on Americans. Because if we want, do we want to rely on the government to help with charging infrastructure? Maybe we just invite BYD and XPeng in as long as they pay for charging infrastructure.
 
 Lei Xing (21:02)
 And
 
 remember, Xpeng does not stop here. So the L03 is a suitable market, a compact crossover SUV, ID4 size, perfect for European urban city streets. But there's even a smaller SUV crossover coming soon.
 
 And all of these next models coming online, the G9L, sent you a photo of the G9L, is something, I don't know if it's the right vehicle for the European markets, but they're preparing.
 
 Tu Le (21:40)
 One thing I'll
 
 Lei Xing (21:40)
 and
 
 Tu Le (21:40)
 point out as well, Lei, is that Xpeng uses their comms team to do marketing.
 
 I really think they should separate that out because marketing is more about branding, more about promotion, more about creating awareness. Communications teams, and you and I have some pretty good contacts at XPeng on the communication side. They're overworked, we know that. Our friend,
 
 Lei Xing (22:05)
 yeah.
 
 Tu Le (22:05)
 I was told was not there.
 
 Lei Xing (22:08)
 Mm-hmm.
 
 Tu Le (22:09)
 She did not make the trip. So I'm sure they're...
 
 was even a bit more of like craziness going on because she
 
 Lei Xing (22:17)
 Yeah.
 
 Tu Le (22:17)
 wasn't able to join. But, I really do think
 
 Lei Xing (22:21)
 hope yeah
 
 Tu Le (22:22)
 part of being mature means that we separate certain functions out because 65 countries Lei, 65 countries, and let's say 20 of those countries are in Europe. Okay. Or let's say
 
 Lei Xing (22:34)
 Mm-hmm.
 
 Tu Le (22:36)
 20-ish countries are in Europe. Different languages.
 
 different customs, different charging infrastructure. So communications teams aren't equipped to really.
 
 communicate messaging that way. That's a marketing function. And
 
 Lei Xing (22:50)
 Yeah. But.
 
 Tu Le (22:54)
 social media doesn't work like it does in China, in Europe, especially in the Southern countries. So that
 
 Lei Xing (23:01)
 But,
 
 Tu Le (23:01)
 would be kind of my advice to Xpeng.
 
 Lei Xing (23:04)
 Yeah, but overall, think the event from, you know, landing to all the different activities was done as good as any company. as large as it an event like this. Right. The dinner, the press conference that the earlier this afternoon, as you know, we actually, Claudio and I was in the
 
 MONA L03 trying out the VLA 2.0, trying out the NGP on the streets of Munich. And well done.
 
 Tu Le (23:36)
 What kind of car was it?
 
 Lei Xing (23:38)
 The MONA L03 with the three Turing
 
 Tu Le (23:40)
 Okay, so it had, it was.
 
 Lei Xing (23:42)
 trips, the Ultra SE version.
 
 Tu Le (23:44)
 Was it regular plates or was it manufacturing plates?
 
 Lei Xing (23:46)
 Yes, no
 
 camos, regular, just the cars they brought. They must have, I heard that they shipped over, I don't know, must have been a few dozen of these cars to show obviously at the event.
 
 Tu Le (24:00)
 Had to be, had to they're probably
 
 gonna ship them to other markets after this week.
 
 Lei Xing (24:06)
 we're close to getting that point where the autonomous driving side of things will again pick up speed in terms of what you're offering in China, what Tesla is offering FSD wise in the US. They may be converging on in this European sector, European region, which is a neutral zone.
 
 Because Chinese, cannot get over to the US. And FSD is still waiting to get approval in China. But Europe could potentially be the battleground for the capabilities of FSD, of these smart driving solutions, once that DCAS comes online.
 
 And
 
 it's an important component of a selling point for Xpeng.
 
 so much is at stake, basically, what I'm saying.
 
 Tu Le (24:59)
 And the other thing that might be interesting to the robotics and humanoids followers is that Xpeng will be selling Iron
 
 Lei Xing (25:09)
 Mm-hmm.
 
 Tu Le (25:09)
 in retail stores next year. So they're continuing to push forward on the robotics side as well. My guess would be within the next 12, 14 months, we'll see more Volkswagens.
 
 with the Turing chip, maybe even in Europe.
 
 You never know.
 
 Lei Xing (25:27)
 Certainly. Yeah, certainly.
 
 also speaking of Volkswagen, He Xiaopeng did say that they're exploring a lot of things on the table, including finding new ways of cooperating with Volkswagen. What he means by that is possibly...
 
 this item on the table being producing Xpengs at one of the idle plants.
 
 Volkswagen. Because he did say
 
 Tu Le (25:53)
 Why are they also-
 
 Lei Xing (25:55)
 on the record, in addition to Magna in Austria, they're looking at regions around Germany for potential manufacturing sites.
 
 Tu Le (26:06)
 Well, let's take that a step further. Will
 
 Lei Xing (26:06)
 and discussion novel.
 
 Tu Le (26:09)
 Volkswagen use XNGP in Europe?
 
 if they're using the Turing chip and you know XPeng is pushing that, I'm certain. Hey, package deal. We'll give you Turing
 
 Lei Xing (26:20)
 He
 
 Tu Le (26:21)
 chips and the software.
 
 Lei Xing (26:22)
 He Xiaopeng
 
 also did mention software licensing.
 
 in European region.
 
 Tu Le (26:28)
 So I'm
 
 Lei Xing (26:29)
 Yeah.
 
 Tu Le (26:29)
 going to press rewind a little bit because at the beginning of the show, you talked about how unprecedented this press conference is, but we got to give the OG's credit. Stella Li has been working overtime. When I was at the FT conference, she was there. She's been to France for the launch of BYD vehicles there.
 
 She was just at Goodwood launching the Denza Z. So
 
 Lei Xing (26:58)
 Mm-hmm.
 
 Tu Le (26:58)
 she's pounding the pavement as well. So we should point out that BYD has really been setting the standard. Xpeng just raised it.
 
 I want to make sure that people do know that BYD is out there.
 
 and putting their number one person out there because she's a woman number one. So it's not like this old white guy
 
 Lei Xing (27:24)
 We were.
 
 Tu Le (27:26)
 kind of thing or man thing. So that's going to be disarming for a lot of people, but that doesn't change the fact that she is always on. She was always on. She's always got her foot on the gas, staying aggressive, being aggressive. She's effectively.
 
 Wong Chuan Fu's mouthpiece for the rest of the world and BYD's
 
 Lei Xing (27:48)
 Yes.
 
 Tu Le (27:49)
 mouthpiece. And I want to acknowledge that and recognize that. And there's going to be some fireworks in Paris for sure, for sure. So because Huawei will be there.
 
 Lei Xing (27:55)
 Yeah, I call it the Paris
 
 Paris Chinese Motor Show.
 
 Tu Le (28:01)
 Yeah, and then so I'll
 
 be in Munich in late September. I'll catch up with some friends. Hopefully, maybe I'll get to borrow an L03 or an L03 Xpeng for a couple of days. Anyways, really quickly and I have to run, but I really quickly did want.
 
 Lei Xing (28:20)
 I know you have to run
 
 and I mean this week for me, it's almost like once in a while that I kind of forced myself to not pay attention to what's happening elsewhere and just focus on Xpeng. Just relieve myself of trying to like follow everything Cause you know, on the date of the launch, seven other models launched.
 
 Tu Le (28:41)
 Yes.
 
 Yes, well, LiAuto launched the L6.
 
 Lei Xing (28:44)
 So L6,
 
 yeah. There's the new
 
 Tu Le (28:46)
 And of course...
 
 Lei Xing (28:48)
 IM, there's a Wuling, there's some other ones. don't even remember.
 
 Tu Le (28:52)
 And
 
 we got the video for the L9.
 
 Lei Xing (28:57)
 Ugh.
 
 Tu Le (28:58)
 And then of course, Germany or European press are drinking through a fire hose because Volkswagen, the aftershocks of Volkswagen's board meeting and the rejection of Bluem's proposal for restructuring is reverberating through the automotive industry.
 
 Bill Ford was in Washington DC and he said, eventually, effectively,
 
 Lei Xing (29:21)
 That was just about it.
 
 Tu Le (29:25)
 and eventually we're going to have to compete and beat the Chinese, which is important that such an important person in the US auto industry has acknowledged. Look, we can cry over spilt milk or we can roll our sleeves up and get to work. You and I as Americans, we know.
 
 how good the products are in China. And we can bitch and moan all we want, but at the end of the day, even if they're not in the US market, you're gonna have to compete with them outside of it. So.
 
 Lei Xing (29:58)
 Dongfeng just had an event with the VOYA and the NAMMI in Canada yesterday. He Xiaopeng, Claudio asked a question about Canada. Alex Tang, their head of overseas, did in fact say the Canadian and the US are their strategic markets and that discussions are ongoing for Canada.
 
 Let's be real, right? So Bill Ford is one of those people that is real. And do not be naive that the door is going to be closed forever. It's not.
 
 You cannot. You will not.
 
 Tu Le (30:31)
 You know, it's just
 
 getting interesting because you see these articles pop up now, Lei. Oh, the US EV sector is dead. All this or all that. I'm going to do this. I don't want to pull a muscle, but you and I should pat ourselves on the back. We've been here since day one, man. We've been here since day one talking about this stuff.
 
 Lei Xing (30:57)
 But again, really lucky being able to attend some of these events anywhere in the world, in China, in Europe, hopefully soon enough in the US. And just to, whenever you attend events, you learn more about the companies and get a better understanding.
 
 Tu Le (31:19)
 I don't know if you got a chance to read that post about the Volkswagen in my newsletter, but what did you think? So the premise of my post was they're at 4.6 million units. Let's say there's around 70 million passenger vehicles sold last year. The US had say 15 million of that. Okay, so if we take out 15 million, because Stella Li said we can get to this number,
 
 And it's going to be a moving target for BYD because today it's 10.5 million to make you the number one automaker. Maybe it's less, maybe it's more by 2030, but my bet is on Toyota or BYD having to overtake Toyota to be number one. I don't think that's going to change because Volkswagen was
 
 Lei Xing (32:05)
 I did
 
 Tu Le (32:07)
 the closest.
 
 Lei Xing (32:07)
 I did see basically that path you mentioned in the newsletter of the path getting
 
 narrower. But Volkswagen is something, They're cut to a 9 million capacity. They're probably going to do 8.5
 
 this year based on the first half numbers, based on the bottom is still not there in the Chinese market. And then you can do the math, right?
 
 Tu Le (32:29)
 And so what I
 
 had said was at 4.6 with 15 million units taken out. that makes the global market 70 million of 70 million, 55 million, So without calculation, 4.6 is around 8 % of global market share that currently BYD has. In order to get to 10 and a half, they need to have 20%.
 
 If we continue to take out that 15 million units and 10 and a half million units being the number that they need to sell 10.5 million and one vehicle to beat Toyota. so I don't doubt that that Stella and Wang Chuanfu believe in their hearts that they can be number one without the U S market.
 
 I just think that's really, really, really, and to your point, what I'd mentioned without the U.S. market, the path narrows. And that means the Japan market, the Australia market, the India market need BYD needs to own 25 to 30 % share in those larger markets in the next 18 to 20 months. But then if sales wasn't the biggest hurdle.
 
 I assumed that they have around 7 million units of capacity, 6 million units of capacity coming either currently or coming online, 7 million units. So I said, if they need to get to that 10.5 million, that means if I'm assuming 250,000 units,
 
 Lei Xing (34:03)
 Thursday.
 
 Tu Le (34:04)
 they need 13 factories more.
 
 Lei Xing (34:06)
 So there's two
 
 pathways I think that potentially could happen is the BYDs and the Chinese catching up to the top tier automotive groups much faster than expected. The other pathway is somehow these foreign automakers, find their mojo, at least in the EV game and regain some ground globally.
 
 But I think the way that it's been happening, things always exceed expectations. Who would have thought at the beginning of this year that domestic sales would be down that much in China?
 
 Tu Le (34:49)
 It's not a great sign.
 
 Lei Xing (34:51)
 Right, so we talk about both good and the bad. We must talk about the bad.
 
 Tu Le (34:55)
 here's the thing,
 
 it's one thing in a growing market if BYD sales flatten, that means competitors are out competing them for customers. But in a market that's actually shrinking, there's a chance everybody loses. There's a good chance everybody loses.
 
 Lei Xing (35:14)
 So
 
 the interesting thing in the back of our mind, the China's goal of having 30 % NEVs on the roads by 2030 and the goal of driving retail sales of consumers goods to 60 trillion RMB by 2030.
 
 Now, that's the overarching goal. How do you get there? There has to be, things happening that help you get there. And the auto industry is a major part of consumption of the economy.
 
 Tu Le (35:48)
 Well, there's two things going on with the automotive and this is the same thing in Germany and the United States is if companies are producing cars, that means people are working. And if people are working, they have to spend their money. And so it's a virtuous cycle, but what's going on now is kind of the opposite. The market is shrinking. That means eventually less people will be working if it stays that way. And that means.
 
 less consumption and effectively less confidence if you're a Chinese consumer because you're worried about being able to keep your job.
 
 Lei Xing (36:25)
 It's yeah.
 
 I know you gotta run, there's certainly too much to talk about but we slice and dice
 
 Tu Le (36:33)
 Let me take a quick look, if there are any questions or
 
 Lei Xing (36:33)
 I don't know if you want to add the comments.
 
 Tu Le (36:37)
 anything. So Tom H has been very active. So Tom, thanks for participating. Absent a change in administration, the US will be closed to China OEMs. Eventually US consumers will demand access to world-class EVs. We couldn't agree more, So yeah, everyone.
 
 we get a bit more people in participation when we're a little bit later in the day than 9 AM. So maybe we got to change that time. I know Felix doesn't
 
 Lei Xing (37:05)
 Well, alright.
 
 Tu Le (37:07)
 like later in the day, we got to, yeah,
 
 Lei Xing (37:09)
 He's probably having a beer somewhere.
 
 Tu Le (37:12)
 we have to do what's good for the masses for everyone. Anyways,
 
 Lei Xing (37:14)
 Yeah. Yeah. Yeah.
 
 Tu Le (37:16)
 we'll have to think about this. Maybe we move to like a 12 or a 1 PM timeframe to see if that's better for everyone.
 
 Lei Xing (37:24)
 But remember when I'm in China, it's going to be tough. I don't mind even doing
 
 Tu Le (37:27)
 Well, it's only not for another couple of weeks. It's only for another few weeks, right?
 
 Lei Xing (37:33)
 it at midnight China time, even if
 
 Tu Le (37:37)
 Okay.
 
 Lei Xing (37:37)
 that has to be done. Fine, be it. can. Yeah.
 
 Tu Le (37:40)
 Well, you're only doing it for another three weeks, right? Three or four weeks.
 
 Everyone, as always, have a good weekend. We will talk with you next week. Good morning, good afternoon, good evening.
 
 Lei Xing (37:53)
 Guten Abend, auf Wiedersehen!
 
 My bad German.