Chinese electric vehicle maker XPeng Inc (XPEV) saw its stock soar on Monday following the revelation that CEO Xiaopeng He had acquired over 2 million shares of the company. This move, which saw He purchase 1 million H-shares at 27.13 Hong Kong dollars per share and 1.42 million American depositary shares at $7.02 each between August 21 and August 23, was interpreted as a vote of confidence in the company’s future.
The CEO, in a statement quoted by the Wall Street Journal, explained that his share buyback reflects his conviction in XPeng’s growth trajectory and prospects. He aims to increase his personal exposure to the stock’s potential gains.
The news comes on the heels of a mixed second quarter for XPeng. While the company reported a 60.2% year-on-year increase in revenue, reaching $1.12 billion, it fell short of analyst expectations of $1.13 billion. Vehicle deliveries rose by 30.2% year-on-year to 30,207 units, with the Volkswagen partnership contributing to improved margins during the quarter. The net loss for the quarter, however, halved to 1.28 billion Chinese Yuan ($0.18 billion), down from 2.80 billion Chinese Yuan a year ago.
The CEO had previously signaled XPeng’s entry into a robust product cycle with the launch of the MONA M03 in August. Despite these positive developments, XPeng’s stock has experienced a significant decline of over 62% in the past year, largely due to weak domestic demand and the impact of protectionist tariffs imposed on the industry.
Last week, reports surfaced indicating that China voiced its support for the electric vehicle industry by criticizing Europe’s import tariffs.
The news of the CEO’s share buyback triggered a positive market response, with XPEV stock climbing by 3.71% to $7.27 in premarket trading on Monday. This surge suggests that investors are optimistic about XPeng’s future, particularly in light of the CEO’s commitment to the company’s success.
