Xpeng announces Mona: a sub-brand of lower priced electric vehicles

Xpeng Inc (NYSE: XPEV) is up 10% on Friday after announcing plans of launching a new sub-brand. 

Xpeng's Mona will launch in the coming months

The electric vehicles company is calling the new brand “Mona” which is expected to go live over the next two to three months. 

Xpeng will roll out new, lower-priced vehicles under this brand for the mass market. Price it’s targeting for Mona EVs is under $20,700. Brian Gu - the Vice Chairman of $XPEV told CNBC today:

Note that the Model Y of Tesla - the best-selling electric SUV in China costs over $30,000. Xpeng stock is down some 45% for the year at writing.

Here's what the launch of Mona means for Xpeng

The launch of Mona puts Xpeng Inc in more direct competition with the likes of Volkswagen and its local rival BYD. 

$XPEV touts its driver-assist software as a key selling point in China while the autonomous drive software of Tesla is not so far available in the world’s largest auto market. 

Vice chair Gu also noted in his interview with CNBC that premium segment of the EV space has over a dozen competitors while the mass market in China is currently dominated by two or three brands only. 

Xpeng showcased its flagship line-up of AI-powered smart EVs at the Beijing Auto Show 2024 as well. In March, it reported a per-share loss of 21 cents only versus a much higher 40 cents expected.