Xpeng (NYSE: XPEV) has officially launched its 'Jupiter Project' aimed at recruiting dealers to its sales network, confirming earlier reports from last month. Since the project's launch, Xpeng has received an impressive 1,200+ applications from prospective dealers looking to join its sales system, as announced by the Chinese electric vehicle (EV) manufacturer on Weibo today.
While Xpeng did not specify the exact launch date of the Jupiter Project, it was initially reported by local media outlet LatePost on September 14. The project, unveiled at a dealer conference on September 2, seeks to entice prominent dealer groups into Xpeng's expanding sales ecosystem.
LatePost's report aptly noted that Jupiter is the planet in our solar system with the strongest gravitational pull and the most moons.
Xpeng's dealer recruitment drive has reached across 230 cities, with 34% of applications originating from dealers ranking among the top 100 in China, according to the company's statement.
Throughout August and September, Xpeng granted approvals for 107 franchise stores, marking significant progress in its expansion strategy.
Xpeng's sales network will encompass both directly-managed stores and authorized dealerships, operating on a "1+N" sales channel model. The company has set specific criteria for potential dealership stores, mandating locations in prominent automotive shopping districts with a minimum area of 1,000 square meters and showrooms spanning no less than 300 square meters, as indicated in promotional materials released today.
Priority will be given to dealerships with registered capital exceeding RMB 10 million, annual automotive business revenue surpassing RMB 100 million, and a gearing ratio of under 70 percent.
Xpeng originally followed a direct sales model when it first emerged, with its initial 20 stores being company-operated. However, in April 2019, shortly after delivering its inaugural production vehicle, the G3, the company announced its openness to dealers and service providers joining its network. Since then, Xpeng has maintained a sales system comprised of both directly-managed and dealer-operated stores, emphasizing order-based sales without dealer inventory and uniform retail pricing.
As of June 30, Xpeng's sales network included a total of 411 stores, as disclosed in the company's Q2 earnings report on August 18. However, a breakdown between directly-managed and dealer-operated stores was not provided.
On September 11, another local media outlet, Jiemian, reported that Xpeng was in the process of phasing out inefficient directly-managed stores while expanding the number of dealer-operated outlets.