XPeng To Roll Out Affordable EVs for Around $20,000 Under Their New 'Mona' Brand

XPeng would thus launch models with zero emissions and with prices of around 150,000 RMB, which translates into approximately $20,500.

The carmaker would buy the development project in an all-stock deal worth of around $744 million. Didi is set to become a strategic shareholder, assisting XPeng with the development of the upcoming models. Developed under the project name 'Mona,' the first should drop sometime next year.

XPeng has been focusing on selling premium EVs. With Mona, they would enter a new low-budget segment. The move would increase the company's presence in the industry and increase sales figures. And the move comes right on time to play down competitors. BYD has been launching affordable models, while NIO has set up the Alps mass market EV brand.

The brand's debut product will be the A-class Smart EV, similar in size to the BYD Qin. The model should enter production in the second half of 2024 and should hit the market in the fall with prices of around RMB 150,000 ($20,500). XPeng and Didi Global will also collaborate on marketing, financials, insurance, charging, ride-hailing, and international expansion.

To focus on the new Mona brand, Didi Global has abandoned the Da Vinci project. Some of the R & D staff and equipment will be taken over by XPeng and used on the Mona.

Competition has been intensifying in China, the world's biggest EV market. Therefore, such a partnership has the potential to keep XPeng afloat and put Didi on the map of EV manufacturing. Otherwise, it would be impossible for companies with no car background to keep up with the industry.

XPeng sold approximately 41,000 electric cars in China in the first half of 2023, which means nearly 2% of the total of EVs sold in the country. Meanwhile, Tesla sold 294,000 cars in the same timeframe, all of them manufactured at the Shanghai plant, while BYD accounted for 550,000 examples. XPeng is hoping that, with the introduction of the Mona brand, things will take a turn for the better.

As per Reuters, Didi will gain around 3.25% of XPeng following the transaction, with shares worth $474 million in total. Fulfilling the delivery targets should take the deal up to $744 million, with the stake going as high as 5.26%,

The Chinese are planning to build at least 100,000 Mona cars per year, with the cars also being sold to retail customers. Yet they are focused on China and Norway, with plans of expanding to Sweden and the Netherlands. There are no immediate plans for them to take their models to the United States, despite being listed in New York.