Macquarie analyst Eugene Hsiao lowered his price target on XPeng‘s US-listed shares to $26.00 from $32.00, cutting 2026 sales estimates by 8% on reduced government subsidies for the company’s best-selling model.
Hsiao maintained an Outperform rating. Based on Thursday’s closing price of $20.88, the new target implies 24.5% upside potential.
“We lower our FY26E volumes by -8% to 545k due to lower govt subsidy for MONA M03 and cut our TP to HK$100/US$26 based on 1.7x P/S,” Hsiao wrote.
XPeng saw sales of its M03 model decline for the second consecutive month in December.
After delivering 16,424 units in October, the brand founded and led by He Xiaopeng recorded 14,886 units in November and 12,390 in December.
Macquarie’s analyst expects 2026 to be a transitional year for the Guangzhou-based automaker as it expands its lineup amid potentially slowing demand for electric vehicles in China.
“2026 would be a transition year for XPeng as it boosts its product portfolio with 4 new models potentially in a slowing China EV demand,” Hsiao wrote.
“Net income breakeven could swing widely depending on revenue structure of VW volume-based fees; we expect ‘Other’ GP [Gross Profit] to decline 27% YoY in 2026E,” the analyst added.
Macquarie now estimates XPeng will deliver 545,000 vehicles globally in 2026, below the company’s internal target of 550,000 to 600,000 units communicated at an internal meeting earlier this week, according to local media outlet 36Kr.
The call contrasts with Hsiao’s more bullish stance on rival Nio, which he upgraded to Outperform on Thursday while raising his 2026 delivery forecast by 7% to 451,000 vehicles.
2025 Performance
XPeng delivered 429,445 vehicles in 2025, exceeding its full-year target of 380,000 units by 13%. The company reached its guidance in mid-November, one month ahead of schedule.
Based on the 2026 target of 550,000 to 600,000 vehicles, XPeng is aiming for 28% to 40% growth this year.
Stock Volatility
US-listed shares of XPeng jumped 8% on Monday, driven by progress in China-EU tariff negotiations, a major credit facility from one of China’s largest banks, and leaked details of the company’s internal sales target and new model plans.
However, the stock erased most of those gains throughout the week.
Expanded Lineup
XPeng is expected to launch seven models in 2026, including range-extended variants of existing fully electric vehicles.
The company is aiming to boost demand by adding two SUVs to its Mona series, which includes the Mona M03 sedan — the brand’s most affordable and best-selling model.
According to 36Kr, two additional SUVs are also expected, including a luxury six-seater.
