Investing.com -- The pre-sale price of Chinese electric vehicle group Xpeng's (NYSE:XPEV) P7+ offering came in lower than anticipated, according to analysts at Morgan Stanley.
At the Paris auto show on Monday, XPeng CEO He Xiaopeng revealed that the pre-sale price of the P7+ electric sedan is set at 209,800 yuan ($29,501). The car is due to go on sale and start deliveries in China in early November.
In a note to clients, the analysts said they had previously expected the price to be in a range of 230,000 yuan to 250,000 yuan ($32,341.56 to $35,153.87), adding that the official cost of the P7+ "may undercut the pre-sales level."
"We think aggressive strategies [...] shall help P7+ stand out in the close match among all major local heavyweights in B-segment [battery electric vehicle] market," the Morgan Stanley analysts wrote.
Investors have been focused on the potential of the P7+, which they hope can be an anchor for XPeng's growth into next year.
XPeng's announcement comes after the launch of its budget MONA M03 electric hatchback coupe, which was priced in August from 119,800 yuan ($16,813).
At that level, the Mona was within the range of EVs priced at between 100,000 yuan - 150,000 yuan ($14,035-$21,052). These account for a third of total car sales in China, according to Reuters. China is the world's largest automotive market.
The cheaper Mona is viewed as a push by loss-making XPeng to create a better economy of scale to help it reach break even. At least 100,000 of the vehicles are tipped to be sold annually, XPeng said.
"It remains early to conclude that P7+ could beat the market's expectation of [5,000-7,000 units per month], but we think P7+ is tracking to extend XPeng's sales momentum stemming from M03 – presenting upside risk," the Morgan Stanley analysts said.
(Reuters contributed reporting.)