XPeng has announced on Friday that it is issuing a physical recall of 47,490 P7+ vehicles due to poor contact in the steering assist motor sensor wiring harness.
According to China’s State Administration for Market Regulation, these vehicles could experience poor contact in the steering assist motor sensor wiring harness.
The recall will take place from September 15, and affects all the sedans produced until late April.
The issue could lead to fluctuations in the steering gear sensor signal, illumination of the steering fault warning light, and failure of the power steering assist, posing a safety hazard.
According to the notice, the recall affects the P7+ EVs produced between August 20, 2024 and April 27, 2025.
Reacting to the news, Morgan Stanley analyst Tim Hsiao wrote in a new research note that — as other models do not use the same steering system — the recall will have a low impact on the brand.
In the note published this Friday, the analyst stated that he expects “a manageable impact” on the company’s target of a steady gross profit margin in the third quarter and net profit breakeven by year-end.
In the second quarter, XPeng posted a record gross margin of 17.3%, while vehicle margin rose for the eighth consecutive quarter to 14.3% — more than doubling from a year ago.
According to Hsiao, “the best way out is always through” and a timely reaction with this recall “can make more of a hiccup than a disruption.”
Morgan Stanley reiterated its Overweight rating and $28 price target on the Chinese automaker’s shares.
Based on Thursday’s close at $20.58, the target implies an upside potential of 36%.
The stock performance more than doubled in the past twelve months, with a 74.1% gain since the year began.
XPeng has delivered 72,024 P7+ vehicles since the beginning of deliveries in November 2024.
This year alone, from January through August, the company delivered 55,039 units of the model.
This means that the 47,490 vehicles affected by the recall represent 65.9% of the model’s total deliveries since its launch.
As the recall was filed, XPeng also revealed that the P7+ sedan is “soon” going to be arriving in Europe, after the new P7 and the refreshed versions of the G6 and G9 SUVs.
Earlier on Friday, the Guangzhou-based automaker also announced that the P7+’s intelligence assisted driving — the ‘Navigation Guided Pilot,’ or NGP — will have its speed limit double from 60 km/h to 130 km/h.
This means that the co-driving system will be expanded to highways.
