Xpeng Hires Banks for Hong Kong IPO of Flying Car Unit

Xpeng Inc. has selected JPMorgan Chase & Co. and Morgan Stanley to assist in preparing an initial public offering (IPO) for its flying car unit, Xpeng Aeroht, in Hong Kong according to Bloomberg. The company has filed confidentially for the IPO, which could take place as early as this year according to Bloomberg. A source close to the matter said that discussions are ongoing, and the IPO plan could still change according to Bloomberg.

The company has rebranded its flying car unit internationally as Aridge and is targeting the low-altitude economy, a sector in China that includes activities like flying taxis and drone operations according to Bloomberg. Xpeng has constructed a 120,000 square meter intelligent factory in Guangzhou, capable of eventually producing one flying vehicle every 30 minutes according to Bloomberg.

Xpeng's CEO He Xiaopeng owns a portion of Xpeng Aeroht and has previously secured a $150 million funding round in 2024 according to Bloomberg. The company's share price has risen 69% over the past year, giving it a market value of approximately $19 billion according to Bloomberg.

Why Did This Happen?

Xpeng is seeking to expand beyond its core automotive business and into emerging technologies such as extended-range hybrids and autonomous driving according to Bloomberg. By doing so, the company aims to position itself as a leader in the next wave of mobility solutions according to Bloomberg.

The company's flying car unit is part of a broader strategy to capitalize on China's push for a low-altitude economy according to Bloomberg. This includes developing infrastructure and services for aerial transportation, which could eventually include flying taxis and other airborne solutions according to Bloomberg.

Xpeng's recent developments in hybrid technology also reflect its strategy to meet customer demands for long-range vehicles according to SCMP. The company launched a hybrid version of its G7 SUV with a claimed driving range of 1,704km between Beijing and Shanghai according to SCMP.

How Did Markets React?

Xpeng's shares have shown strong performance in recent months, with a 69% rise over the past year according to Bloomberg. This is reflected in the company's decision to upgrade its IPO plans, as it seeks to attract further capital for its flying car unit according to Bloomberg.

In late December, Freedom Capital Markets upgraded Xpeng's stock rating from Hold to Buy according to Investing.com. The firm also raised its price target for Xpeng from $20 to $25, citing the company's improved financial position and market expansion according to Investing.com.

The company reported strong delivery numbers in 2025, with 391,937 units delivered between January and November. This represents a 156% year-on-year increase according to Investing.com. Xpeng's overseas deliveries grew by 95% in the same period, reaching 39,773 units according to Investing.com.

What Are Analysts Watching Next?

Analysts are closely watching the outcome of Xpeng's IPO plans and whether the company can maintain its momentum in the global EV market according to Bloomberg. The company has also announced plans to begin mass production of humanoid robots in the second half of 2026 according to National Technology. Xpeng's robotaxi trials are expected to begin soon, with three models planned for release in 2026 according to National Technology. The company is also developing its own AI chip, the Turing chip, which will power these new technologies according to National Technology.

The company's CEO has emphasized the importance of integrated AI in future products, stating that Xpeng is not just an automaker but a technology company according to National Technology. This repositioning is expected to attract new investors and differentiate the company from traditional automakers according to National Technology.

The financial performance of Xpeng's flying car unit remains a key focus for analysts, who are monitoring whether it can generate significant revenue and contribute to the company's overall profitability according to Bloomberg. Xpeng's shares remain volatile, with recent swings in price reflecting investor sentiment toward the EV sector according to Investing.com.

Xpeng's strategy to expand into physical AI and robotics is part of a broader industry trend according to National Technology. Companies like Tesla and Toyota are also investing in similar technologies, and the competitive landscape is expected to intensify according to National Technology.

The company's ability to execute on its IPO and expand its AI and robotics offerings will be crucial in determining its long-term success according to National Technology. Analysts will continue to monitor these developments and how they impact the company's market position and financial results according to Bloomberg.

Xpeng's stock has outperformed many of its peers in recent months according to Investing.com. However, the company still faces challenges, including intense competition in the EV market and the need to generate consistent profits according to Bloomberg.

Investors will also be watching the company's financial health, including its cash reserves and debt levels according to Investing.com. Xpeng has maintained more cash than debt on its balance sheet, which is a positive sign for its financial stability according to Investing.com.

The company's IPO could provide a significant boost to its capital base, allowing it to fund its expansion into new markets and technologies according to Bloomberg. It could also signal to investors that Xpeng is confident in its future growth prospects according to Bloomberg.

Overall, Xpeng's plans for an IPO of its flying car unit represent a major step forward for the company as it seeks to solidify its position as a leader in the EV and AI sectors according to Bloomberg.