• China has the world’s largest electric vehicle market.

• But Xpeng CEO He Xiaopeng says most Chinese automakers won’t exist in 10 years.

• He predicted that ultimately only seven major automakers would remain in China.

Xpeng CEO He Xiaopeng doesn’t think most Chinese automakers will survive the next decade.

“Out of 300 start-ups, only 100 survived. Today, there are less than 50 companies that still exist, and only 40 of them sell cars every year,” he told the Singapore newspaper. Strait Times in an interview published Monday.

“Personally, I think there will only be seven major automakers in the next 10 years,” added the Xpeng founder-CEO. He did not specify who he thought the seven survivors would be.

Representatives for He at Xpeng did not respond to a request for comment from Business Insider.

This is not the first time he has predicted brutal, self-eliminating competition among Chinese automakers.

In March, he told Singapore TV CNA that in the next three to four years, China’s electric vehicle industry will experience a “playoff tournament”, followed by intense competition between “all-star” players.

Who wins in 2030 will depend on the “capabilities” and “feasibility” of these actors, he said.

“The auto industry is a marathon, it’s not like a sprint,” he told CNA.

CEO of Mercedes-Benz Ola Källenius took a similar stance to He when asked about the threat posed by Chinese electric vehicle makers at the Berlin Global Dialogue conference in October.

“It’s strange. It’s a Darwinist type of price war, a cleansing of the market. And a lot of the players that exist now. A lot of them won’t be there in five years,” he said. said Källenius.

Chinese dominance of electric vehicles

China’s dominance in electric vehicles stems in part from generous grants the country’s government has given automakers the opportunity to reduce costs and encourage ownership of electric vehicles.

But the competition in China — the the largest electric vehicle market in the world -became increasingly steep.

Stephen Dyer, automotive consultant at AlixPartners, said The Wall Street Journal As of April 2023, a total of 123 brands have sold at least one electric vehicle on the Chinese mainland.

Chinese automakers like BYD have also tried to conquer the global electric vehicle market.

According to data compiled by technology company ABI Research For BI, Chinese automakers accounted for 70% of the electric vehicle market in Thailand and 88% in Brazil in the first quarter of this year.

In announcing its third quarter results last month, BYD said surpassed Tesla’s revenue from electric vehicle sales for the first time.

Prices of Xpeng’s U.S.-listed American depositary receipts have fallen nearly 11% since the start of the year. The company has not recorded a profit since its founding in 2014.

Xpeng Vice Chairman and President Brian Gu said in March that the company was on track to “reach profitability at some point in 2025.“

Xpeng is expected to announce its third-quarter results on Tuesday.

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