Alibaba Group has recently sold a portion of its stake in XPeng Inc., a prominent Chinese electric vehicle (EV) manufacturer. The sale involved 33 million shares of XPeng, amounting to $317 million, which decreased Alibaba’s ownership in the company by 2.9%.
The transaction was completed at a slight discount compared to XPeng’s market price, with shares priced between $9.60 and $9.75 per American depositary share (ADR). This pricing reflected a 2.9% reduction from XPeng’s ADRs’ closing price, which was $9.89 per share at the time of the sale.
Initially investing in XPeng in September 2019 before its IPO, Alibaba has maintained collaborative ties with the EV manufacturer. Despite the divestment, both companies are committed to continuing their partnerships, particularly in research and development endeavors.
XPeng’s financial performance for the fourth quarter of 2021 showcased notable growth in vehicle deliveries and revenue. The company achieved a remarkable 357% increase in vehicle deliveries, totaling 14,562 units compared to the same period in 2020. Furthermore, revenue surged by an impressive 461% year-over-year, reaching 21.4 billion Chinese yuan (approximately $3.37 billion).
In addition to its collaboration with Alibaba, XPeng is actively expanding its operations and product offerings. Recently, the company unveiled plans to establish a new manufacturing facility in Guangzhou, with an anticipated annual production capacity of 150,000 vehicles. Moreover, XPeng introduced its latest EV model, the P7, boasting a range exceeding 700 kilometers on a single charge.
Despite Alibaba’s divestment, XPeng remains resilient and poised for growth in the EV market, both domestically and internationally. With robust financial performance and an expanding product portfolio, XPeng is well-equipped to capitalize on the burgeoning demand for electric vehicles.
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