Xpeng CEO He Xiaopeng has no doubt that the fierce competition in the automotive industry will lead to the downfall of even more car brands.
“It will be tougher than ever,” he warns, as cited by Boosted.
A Bleak Forecast for the Industry
He Xiaopeng predicts a challenging period for automakers between 2025 and 2027, describing it as a ruthless “excretion race” where only the strongest will survive. This competition is particularly evident in China, the world’s largest car market, where a major shakeout appears inevitable.
In November last year, He noted a drastic decline in the number of Chinese car manufacturers.
“From 300 start-ups, there are now fewer than 50 companies, and only 40 of them actually sell cars each year,” he explained in an interview with The Straits Times.
Looking ahead, He predicts that in a decade, only seven major car companies will remain.
He Xiaopeng’s skeptical outlook is shared by other leaders in the automotive sector.
Mercedes-Benz CEO Ola Källenius has also addressed the growing challenge posed by Chinese automakers in October, calling it an “existential struggle” for Western brands.
“It’s a Darwinian price war and a market purge. Many of the players who are here now won’t be here in five years,” Källenius said at the Berlin Global Dialogue conference.
A Brutal Knockout Race
He Xiaopeng foresees a series of brutal “knockout rounds” in the Chinese electric car industry over the next three to four years, followed by an “all-star competition” in the subsequent seven to eight years.
By then, only the most successful car brands are likely to survive.
In an internal letter to Xpeng employees, obtained by The Wall Street Journal, He described an automotive industry under immense pressure, where competition in 2025 will be fiercer than ever.
China’s heavily state-supported car industry includes a wide array of brands, such as NIO, BYD, Li Auto, Geely brands, and Great Wall Motors—all vying for dominance.
