Since Tesla's stock rocketed in recent years, so has the stock Rivian, Lucid, Nio, Ford and even Xpeng. A lot of investors are sleeping on Xpeng's potential.

Chinese electric car start-up Xpeng plans to become a global automaker, with half of vehicle deliveries going to countries outside China, vice president and chairman Brian Gu said Wednesday. They also mentioned "Robotaxis" in their recent earnings report which has gotten some investors excited.

The stock is up 76% in the past six months. I would get in under $30.

  • The race to EVs is a global competition and China may likely be the winner. Gu said the company expects to enter Sweden, Denmark and the Netherlands next year.
  • The company's quarterly vehicle deliveries reached 25,666, representing a 199.2% increase year-over-year.
  • Xpeng and Chinese rivals Nio and BYD have already begun expanding to Norway in the last year.

A point of note in the earnings release was the CEO's mention of robotaxi's. Xiaopeng said the company has made solid progress in its Navigation Guided Pilot technology, which expands usage to "complex city driving scenarios." So have GM Cruise, Baidu, Aurora, Argo AI (with Ford) and others of course.

Gu said Guangzhou-based Xpeng would invest more in international markets this year and next. China accounted for over 22% of Tesla's recent sales. Xpeng began shipping cars to Norway in December 2020. Other Chinese automakers have focused their initial overseas expansion on the country, where government incentives have supported local demand for electric cars.

Over the long haul, the future looks bright for EV makers. Analysts are bullish about both China EV sales and global EV sales. In 2021, EV sales are expected to rise more than 30% to 1.8 million units in China, according to the China Association of Automobile Manufacturers. 

While the EV sector is likely a significant equity bubble, the winners will be very good car manufacturers if they can delivery on their very risky promises. Globally, EV sales are expected to rise 70% in 2021, according to IHS Markit. So no wonder investors are betting on these startups as if they were going to the races.

Xiaopeng said the technology has fueled "greater confidence" in its "ability to explore autonomous driving enabled mobility solutions in the future, such as robotaxi technologies."Last week, BYD said it launched deliveries to the Dominican Republic, following a similar expansion to Brazil, Mexico, Colombia, Uruguay, Costa Rica, and the Bahamas in October. China will be a powerhouse in EVs, it's just not clear how dominant they will become.

Xpeng has raised $4.6 billion. That's a bit less than half of what Rivian has raised. Xpeng said last month it has produced a total of just over 100,000 cars since its founding six years ago. The company launched its first commercially available vehicle, the G3 SUV, in December 2018. But the P7 sedan, which began deliveries last summer, has proven far more popular and accounts for more than 77% of deliveries, according to Gu.

For Q4, XPeng expects deliveries to be between 34,500 and 36,500, representing a year-over-year increase of approximately 166.1% to 181.5%. Xpeng began delivering a third electric model, the P5 sedan, in October. Last week, the start-up revealed a new electric SUV, the G9, which Xpeng said is designed for the international and Chinese markets. It's exciting times to invest in EV startups but be carefully, they are likely over-valued by 200% at this point.

The current price of $XPEV is $51.30.