He Xiaopeng: High-end smart driving will reach an inflection point in the next 18 months

On March 16, at the China Electric Vehicle 100 Forum (2024), He Xiaopeng, Chairman and CEO of Xpeng Motors, gave a speech. He said: “In the past ten years, we can see that R&D in the first five years, and In the next five years, Xpeng Motors will launch one car every year, but in the next ten years, as we iterate the third architecture, I believe that China's new energy vehicles will definitely enter a very market-oriented competition stage in the next three years. . In the next 18 months or longer, Xiaopeng sees a trend, that is, the inflection point of high-level intelligent driving will come."

"Xpeng Motors Chairman and CEO He Xiaopeng"

The following is a transcript of the content:

Dear Chairman Wan Gang, Chairman Qingtai, Minister Miao, Minister Shan, leaders and colleagues, hello!

Everyone who spoke after Li Bin actually followed the new car-related start-ups or revolutionary companies in the past ten years. You can see that we basically don’t talk about history because we don’t have any special history to talk about. The past ten years have really been a magical decade. We had a closed-door meeting yesterday and we are very grateful to Chairman Wan Gang, Chairman Qingtai, Minister Miao, and all leaders. I think the past ten years have pointed us in a direction. New energy vehicles are the future, and this future is not the "NIO" of NIO. There are a number of companies thinking, practicing and innovating in this industry, and I think Xpeng Motors is also a very lucky one among them. Looking back, in August 2014, that is, ten years ago, Xpeng Motors was established. At that time, we had many processes that we did not expect. In the past ten years, Xpeng Motors has conducted research and development behind closed doors for the first five years, which means that the first car was not launched until the fifth or sixth year, that is, in 2019.

Let's recall that in 2019, there were more than 300 new car-making forces in China. Now, there may be a few of us here today, about 10 in total. This month is very symbolic. Xiaomi, the latest car company in China's new energy vehicle industry, will start a press conference this month. Basically, those who have ideas and are willing to act in this industry in the past ten years will be the tenth year. Everyone will play their cards.

The second thing I didn't expect is that in 2019, I remember that I was very impressed. I went to the department to discuss with many colleagues and experts from the OEMs about how big the penetration rate would be in 2025. I remember that most of our brother companies were Say it may be 20% in 2025. At that time, we had just released our first car, and we had not yet released several thousand vehicles. We boldly said that it might exceed 20% by then. Just like the data from Wang Chuanfu, who is currently the best top student in new energy vehicles, This past week it has reached 48%. I am a National People's Congress representative in the new energy automobile industry, and I have a particularly strong feeling this year. Basically, we are talking about the development of new productivity based on local conditions. New productivity has three characteristics. I looked up this term specifically. First, high technology; second, high quality; third, high efficiency. In fact, we are very lucky. I think all new energy vehicles in our industry adhere to these three requirements, adapt to local conditions, and can go global based on Chinese characteristics. In fact, you need to see an interesting data. Chinese brands of new energy vehicles account for more than 90% of the entire car sales. This is something that fuel vehicles did not achieve in the past. More than 90% of car sales come from Chinese brands.

In the past ten years, we can see that in the first five years, Xpeng Motors did research and development, and in the next five years, Xpeng Motors launched a car every year. But in the next ten years, when we iterate the third architecture, in the next three years I believe that China's new energy vehicles will definitely enter a very market-oriented competition stage. It's a knockout from my perspective.

So for Xpeng Motors, how to meet this knockout round? Many people have asked me. I think the most important thing is that companies like ours should learn from their big brothers and build all system capabilities, organizational capabilities, and operational capabilities. Xpeng Motors will release its financial report next week and will report to everyone at that time. In the past year or so, Xpeng Motors has spent its greatest energy on solving and improving organizational efficiency and operational capabilities, and I have seen tremendous changes. I think that in today's changing technology, changing market competition, and there are so many high-level players, if we follow the original approach, we will not be able to win the war.

Second, many people are mentioning that the last decade of Xpeng was a decade of new energy, and the next decade will be a decade of intelligence. Many friends know that Xpeng Motors has believed that intelligence is the future from the first day it was founded. We believe that the core inflection point of smart cars, just like Apple’s iPhone 4 at the time, will be that its revolution comes from intelligence, not just styling, not just cost, not just quality. So the decade of intelligence has arrived. How should we welcome and embrace it? Today I would like to spend a few minutes reporting to you.

At Xpeng Motors, we have been unswervingly investing in autonomous driving for the past ten years. In 2021, we launched China's first NGP solution that uses high-precision maps on highways. Today you can see that all cars built by more than 200,000 new car manufacturers are standard equipment, but at that time no one believed it. We launched the industry's first high-level assisted driving in unpictured cities a year and a half ago. It was in Guangzhou at the time, and in the 243 cities we launched in January this year, high-level assisted driving is available in the city. The first challenge many people ask me is, is smart driving safe? I would like to share a data with you. From our current point of view, the accident rate of intelligent driving is less than 1/10 of that of manual driving. In fact, I think that with the improvement of intelligent driving capabilities, more and more intelligent driving upgrades to For fully autonomous driving, this number can be between one percent and one thousandth. Many friends may not understand that according to unofficial data, more than two million people die due to automobiles in the world every year. If we really do fully autonomous driving or high-level autonomous driving with car, road, and cloud collaboration within ten to twenty years, and reduce the number of people from two million to less than 20,000, I believe this will be huge. the value of. So I think all our new energy vehicle colleagues should be working hard, and Xiaopeng is also working hard.

Let me make a point here. In the next 18 months or longer, Xiaopeng sees a trend, that is, the inflection point of high-level intelligent driving will come. What is high level? What have we accomplished on the highway in the past three years? The number of active and passive takeovers for high-speed intelligent assisted driving is about 0.1 times per 100 kilometers, that is, every 100 kilometers of driving, you don't need to take over at all most of the time. But today in cities, the number of takeovers is more than 10 per 100 kilometers. I believe that in the next 18 to 36 months, if we can make all cities, 99% of roads, and 99% of scenes so that we only need to take over less than 1 time or even 0.1 times per 100 kilometers, we will drive It will be completely different.

The second point is that high-end intelligent driving is smarter for everyone to see. ChatGPT at the beginning of last year, including Sora at the beginning of this year, allowed everyone to see the changes in AI with greater computing power and larger data models. Later I will also introduce Xpeng Motors’ progress in real mass production of large models. A development in cars. In addition, I think an important reason why intelligent assisted driving has not formed the top three car purchasing decisions of customers in the past is that it is too expensive. We have seen that high-level intelligent assisted driving is about 50,000 yuan more expensive than ordinary intelligent assisted driving that only provides ACC. And if it is only 10,000 or 20,000 yuan more expensive, we believe that high-level intelligent assisted driving or even driverless driving will quickly occupy this market. In the past, most industries did not discuss this topic because there was no way, because the CPU was not ours, because a lot of sensors were needed, because R&D was very expensive, and because the platform was not well implemented. In the past, Xpeng had one car every year. In the next three years, when Xpeng has more than a dozen brand-new cars and multiple vehicles for the world, it can be amortized significantly, allowing cheaper autonomous driving to come.

Xpeng Motors' investment in intelligent research and development will reach 3.5 billion yuan in 2024. In fact, today's intelligent research and development has become a workload with big computing power, big data, a lot of money and many people, which is extremely difficult for ordinary computing power companies. One thing I want to share with you today is that in terms of intelligent driving, in the second quarter of this year, Xpeng will become the first company in the industry to put large models on cars. We'll start converting video streams into plans and rules that cars can understand, and what will that lead to? For example, to give an example, we recently saw that it was snowing in Beijing. Is the method of driving with autonomous driving the same when it snows as when it is not snowing? Same road but completely different scene. In the past, there was no way to make intelligence smart. But I believe that today has opened a window for us. Whether it is the intelligence of smart driving or the launch of large models, in fact, Xiaopeng will be the first to launch it in the second quarter of this year.