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1、Table of Contents UNITED STATESSECURITIES AND EXCHANGE COMMISSIONWASHINGTON,D.C.20549 FORM 20-F (Mark One)REGISTRATION STATEMENT PURSUANT TO SECTION 12(b)OR 12(g)OF THE SECURITIESEXCHANGE ACT OF 1934OR ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d)OF THE SECURITIES EXCHANGE ACT OF 1934For the fiscal

2、year ended December 31,2023OR TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)OF THE SECURITIES EXCHANGE ACT OF1934OR SHELL COMPANY REPORT PURSUANT TO SECTION 13 OR 15(d)OF THE SECURITIES EXCHANGEACT OF 1934Date of event requiring this shell company reportFor the transition period from _to_Commissi

3、on file number 001-39466 XPeng Inc.(Exact name of Registrant as specified in its charter)Cayman Islands(Jurisdiction of incorporation or organization)No.8 Songgang Road,Changxing StreetCencun,Tianhe District,GuangzhouGuangdong 510640Peoples Republic of China(Address of principal executive offices)Ho

4、ngdi Brian Gu,Honorary Vice Chairman and Co-PresidentTelephone:+86-20-6680-6680Email:At the address of the Company set forth above(Name,Telephone,E-mail and/or Facsimile number and Address of Company Contact Person)Securities registered or to be registered pursuant to Section 12(b)of the Act:Title o

5、f each class TradingSymbol(s)Name of each exchangeon which registeredAmerican Depositary Shares,each representing two Class A ordinary shares XPEV New York Stock ExchangeClass A ordinary shares,par value US$0.00001 per share*New York Stock Exchange*Not for trading on the New York Stock Exchange,but

6、only in connection with the listing on the New York Stock Exchange of Americandepositary shares.Securities registered or to be registered pursuant to Section 12(g)of the ActNone(Title of Class)Securities for which there is a reporting obligation pursuant to Section 15(d)of the ActNone(Title of Class

7、)Indicate the number of outstanding shares of each of the issuers classes of capital or common stock as of the close of the period covered by theannual report.1,536,728,823 Class A ordinary shares were outstanding as of December 31,2023348,708,257 Class B ordinary shares were outstanding as of Decem

8、ber 31,2023Indicate by check mark if the registrant is a well-known seasoned issuer,as defined in Rule 405 of the Securities Act.Yes NoIf this report is an annual or transition report,indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or 15(d)of the Secur

9、ities Exchange Act of 1934.Yes NoIndicate by check mark whether the registrant:(1)has filed all reports required to be filed by Section 13 or 15(d)of the Securities Exchange Actof 1934 during the preceding 12 months(or for such shorter period that the registrant was required to file such reports),an

10、d(2)has been subject to suchfiling requirements for the past 90 days.Yes NoIndicate by check mark whether the registrant has submitted every Interactive Data File required to be submitted pursuant to Rule 405 ofRegulation S-T(232.405 of this chapter)during the preceding 12 months(or for such shorter

11、 period that the registrant was required to submit suchfiles).Yes NoIndicate by check mark whether the registrant is a large accelerated filer,an accelerated filer,a non-accelerated filer,or an emerging growthcompany.See the definitions of“large accelerated filer,”“accelerated filer,”and“emerging gr

12、owth company”in Rule 12b-2 of the Exchange Act.Large accelerated filer Accelerated filer Non-accelerated filer Emerging growth company If an emerging growth company that prepares its financial statements in accordance with U.S.GAAP,indicate by check mark if the registrant haselected not to use the e

13、xtended transition period for complying with any new or revised financial accounting standards provided pursuant toSection 13(a)of the Exchange Act.The term“new or revised financial accounting standard”refers to any update issued by the Financial Accounting Standards Board to itsAccounting Standards

14、 Codification after April 5,2012.Indicate by check mark whether the registrant has filed a report on and attestation to its managements assessment of the effectiveness of itsinternal control over financial reporting under Section 404(b)of the Sarbanes-Oxley Act(15 U.S.C.7262(b)by the registered publ

15、ic accounting firmthat prepared or issued its audit report.If securities are registered pursuant to Section 12(b)of the Act,indicate by check mark whether the financial statements of the registrant includedin the filing reflect the correction of an error to previously issued financial statements.Ind

16、icate by check mark whether any of those error corrections are restatements that required a recovery analysis of incentive-based compensationreceived by any of the registrants executive officers during the relevant recovery period pursuant to 240.10D-1(b).Indicate by check mark which basis of accoun

17、ting the registration has used to prepare the financial statements included in this filing:U.S.GAAP International Financial Reporting Standards as issued Other by the International Accounting Standards Board If“Other”has been checked in response to the previous question,indicate by check mark which

18、consolidated financial statement item theregistrant has elected to follow.Item 17 Item 18If this is an annual report,indicate by check mark whether the registrant is a shell company(as defined in Rule 12b-2 of the Securities ExchangeAct of 1934).Yes No(APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPT

19、CY PROCEEDINGS DURING THE PAST FIVE YEARS)Indicate by check mark whether the registrant has filed all documents and reports required to be filed by Sections 12,13 or 15(d)of the SecuritiesExchange Act of 1934 subsequent to the distribution of securities under a plan confirmed by a court.Yes No Table

20、 of ContentsTABLE OF CONTENTS Page PART I.ITEM 1.IDENTITY OF DIRECTORS,SENIOR MANAGEMENT AND ADVISERS 5 ITEM 2.OFFER STATISTICS AND EXPECTED TIMETABLE 5 ITEM 3.KEY INFORMATION 5 ITEM 4.INFORMATION ON THE COMPANY 73 ITEM 4A.UNRESOLVED STAFF COMMENTS 114 ITEM 5.OPERATING AND FINANCIAL REVIEW AND PROSP

21、ECTS 114 ITEM 6.DIRECTORS,SENIOR MANAGEMENT AND EMPLOYEES 132 ITEM 7.MAJOR SHAREHOLDERS AND RELATED PARTY TRANSACTIONS 143 ITEM 8.FINANCIAL INFORMATION 145 ITEM 9.THE OFFER AND LISTING 146 ITEM 10.ADDITIONAL INFORMATION 147 ITEM 11.QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK 155 ITEM

22、12.DESCRIPTION OF SECURITIES OTHER THAN EQUITY SECURITIES 156 PART II.ITEM 13.DEFAULTS,DIVIDEND ARREARAGES AND DELINQUENCIES 158 ITEM 14.MATERIAL MODIFICATIONS TO THE RIGHTS OF SECURITY HOLDERS AND USE OF PROCEEDS 158 ITEM 15.CONTROLS AND PROCEDURES 159 ITEM 16A.AUDIT COMMITTEE FINANCIAL EXPERT 160

23、ITEM 16B.CODE OF ETHICS 160 ITEM 16C.PRINCIPAL ACCOUNTANT FEES AND SERVICES 160 ITEM 16D.EXEMPTIONS FROM THE LISTING STANDARDS FOR AUDIT COMMITTEES 160 ITEM 16E.PURCHASES OF EQUITY SECURITIES BY THE ISSUER AND AFFILIATED PURCHASERS 160 ITEM 16F.CHANGE IN REGISTRANTS CERTIFYING ACCOUNTANT 161 ITEM 16

24、G.CORPORATE GOVERNANCE 161 ITEM 16H.MINE SAFETY DISCLOSURE 161 ITEM 16I.DISCLOSURE REGARDING FOREIGN JURISDICTIONS THAT PREVENT INSPECTIONS 161 ITEM 16J.INSIDER TRADING POLICIES 161 ITEM 16K.CYBERSECURITY 162 PART III.ITEM 17.FINANCIAL STATEMENTS 163 ITEM 18.FINANCIAL STATEMENTS 163 ITEM 19.EXHIBITS

25、 163 -i-Table of ContentsCONVENTIONS THAT APPLY TO THIS ANNUAL REPORT ON FORM 20-FExcept where the context otherwise requires,references in this annual report to:“ADAS”are to advanced driver assistance systems,which are designed to assist drivers in driving and parking functions;“ADSs”are to America

26、n depositary shares,each of which represents two Class A ordinary shares;“affiliate shareholders of the Group VIEs”are to(i)the individual shareholders of the Group VIEs,(ii)Kuntu Technology,which isultimately beneficially owned by Mr.Heng Xia and Mr.Tao He and holds all of equity interest in Xintu

27、Technology;(iii)GuangzhouXuetao;and(iv)the individual shareholders of Guangzhou Xuetao,being Mr.Yeqing Zheng.For avoidance of doubt,affiliate shareholdersof the Group VIEs do not include(i)Xiaopeng Technology,which is our subsidiary and holds 50%of equity interest in Zhipeng IoV,or(ii)Xiaopeng Chuxi

28、ng,which is our subsidiary and holds 50%of equity interest in Yidian Chuxing;“App”are to computer program designed to run on smartphones and other mobile services;“BIS”are to the Bureau of Industry and Security of the U.S.Department of Commerce;“Chengxing Zhidong”are to Guangzhou Chengxing Zhidong A

29、utomotive Technology Co.,Ltd.(廣州橙行智動汽車科技有限公司);“China”and the“PRC”are to the Peoples Republic of China,including Hong Kong Special Administrative Region and Macau SpecialAdministrative Region,unless referencing specific laws and regulations adopted by the PRC and other legal or tax matters only appli

30、cableto mainland China;“PRC subsidiaries”and“PRC entities”refer to entities established in accordance with PRC laws and regulations;“CLTC”are to China Light-Duty Vehicle Test Cycle,which is developed by the China Automotive Technology&Research Center toreplace European testing procedures for fuel/en

31、ergy consumption and emissions;“DiDi”are to DiDi Global Inc.,an exempted company with limited liability incorporated under the Laws of the Cayman Islands and itssubsidiaries;“DiDi Share Purchase Agreement”are to the Share Purchase Agreement dated August 27,2023 among the Company,DiDi and Da VinciAut

32、o Co.Limited in relation to the Companys acquisition of the entire issued share capital of Xiaoju Smart Auto Co.Limited,inconsideration of the Companys newly issued Class A ordinary shares;“DiDi Strategic Cooperation Agreement”are to the Strategic Cooperation Agreement dated August 27,2023 between t

33、he Company andDiDi for the cooperation on,among others,the research and development of an A-class automobile vehicle;“Dogotix”are to Dogotix Inc.,a company incorporated in the Cayman Islands with limited liability;“E/E architecture”or“EEA”are to electrical/electronic architecture;“EV”or“electric veh

34、icle”are to the battery electric vehicle used for the carriage of passengers;Table of Contents “GIIA”are to Guangdong Intelligent Insurance Agency Co.,Ltd.(廣東智選保險代理有限公司,formerly known as Qingdao MiaobaoInsurance Agent Co.,Ltd.(青島妙保保險代理有限公司);“the Group”are to XPeng Inc.,the Group VIEs and their respe

35、ctive subsidiaries;“Group VIEs”are to(i)Zhipeng IoV,(ii)Yidian Chuxing,(iii)Xintu Technology and(iv)GIIA.Each of Zhipeng IoV,Yidian Chuxing,Xintu Technology and GIIA is a“Group VIE”;“Guangzhou Xuetao”are to Guangzhou Xuetao Enterprise Management Co.,Ltd.(廣州雪濤企業管理有限公司);“HD”are to high definition;“HFC

36、A Act”are to the Holding Foreign Companies Accountable Act;“Hong Kong Listing Rules”are to the Rules Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited,asamended or supplemented from time to time;“ICE”are to internal combustion engine;“individual shareholders of the Group

37、 VIEs”are to(i)Mr.Heng Xia,who holds 40%of equity interest in Zhipeng IoV and 10%of equityinterest in Yidian Chuxing,(ii)Mr.Tao He,who holds 10%of equity interest in Zhipeng IoV,and(iii)Mr.Xiaopeng He,who holds 40%of equity interest in Yidian Chuxing;“Kuntu Technology”are to Guangzhou Kuntu Technolo

38、gy Co.,Ltd.(廣州鯤圖科技有限公司);“LIDAR”are to light detection and ranging;“mid-to high-end segment”are to the segment in Chinas passenger vehicle market with prices ranging from RMB150,000 toRMB400,000,not including any government subsidy;“MIIT”are to the Ministry of Industry and Information Technology of t

39、he PRC;“MOF”are to the Ministry of Finance of the PRC;“MOST”are to the Ministry of Science and Technology of the PRC;“MPV”are to multi-purpose vehicle;“NEDC”are to New European Driving Cycle,which is designed to assess the emission levels of car engines and fuel economy inpassenger vehicles;“NEV”are

40、 to new energy passenger vehicles,comprising of battery electrics vehicles,plug-in hybrid electric vehicles(including extended-range electric vehicles)and fuel cell electric vehicles;“OEM”are to automotive original equipment manufacturer;“ordinary shares”are to our Class A ordinary shares,US$0.00001

41、 par value per share and Class B ordinary shares,US$0.00001 par valueper share;each Class A ordinary share is entitled to one vote;and each Class B ordinary share is entitled to 10 votes;“OTA”are to Over-The-Air technology;-2-Table of Contents “PCAOB”are to the U.S.Public Company Accounting Oversigh

42、t Board;“RMB”or“Renminbi”are to the legal currency of China;“SAFE”are to State Administration of Foreign Exchange of the PRC;“Smart EV”are to electric vehicles with a rich array of connectivity,advanced driver assistance systems and smart technology features;“Subsidiaries”are to an entity controlled

43、 by XPeng Inc.and consolidated with XPeng Inc.s results of operations due to XPeng Inc.sequity interest in such entity,instead of contractual arrangements;for avoidance of doubt,the Group VIEs are not subsidiaries of XPengInc.;“SUV”are to sport utility vehicle;“Taobao China”are to Taobao China Holdi

44、ng Limited,a limited liability company incorporated under the laws of Hong Kong;“US$,”“U.S.dollars,”or“dollars”are to the legal currency of the United States;“Volkswagen China”are to Volkswagen(China)Investment Co.,Ltd.(大眾汽車（中國）投資有限公司),a company incorporated under thelaws of the PRC;“Volkswagen Grou

45、p”are to Volkswagen AG,a company incorporated under the laws of Germany with limited liability,the shares ofwhich are listed on Frankfurt Stock Exchange in Germany and all of its subsidiaries(including Volkswagen China and VolkswagenNominee);“Volkswagen Investment”are to the investment by Volkswagen

46、 Group pursuant to the VW Share Purchase Agreement;“Volkswagen Nominee”are to Volkswagen Finance Luxemburg S.A.,a company incorporated under the laws of Luxembourg;“VW Share Purchase Agreement”are to the Share Purchase Agreement dated July 26,2023 among the Company,Volkswagen China andVolkswagen Nom

47、inee,pursuant to which Volkswagen China(or Volkswagen Nominee)agreed to subscribe 4.99%of the total issued andoutstanding ordinary shares of the Company(with a cap of 94,666,666 Class A ordinary shares)upon the completion of the VolkswagenInvestment;“VW Technical Framework Agreement”are to the Techn

48、ical Framework Agreement dated July 26,2023 and entered into betweenXiaopeng Motors and Volkswagen China in respect of the strategic technical collaboration between the Company and the VolkswagenGroup;“Xiaopeng Chuxing”are to Guangzhou Xiaopeng Zhihui Chuxing Technology Co.,Ltd.(廣州小鵬智慧出行科技有限公司);“Xia

49、openg Motors”are to Guangdong Xiaopeng Motors Technology Co.,Ltd.(廣東小鵬汽車科技有限公司);“Xiaopeng Motors Sales”are to Xiaopeng Motors Sales Co.,Ltd.(小鵬汽車銷售有限公司);“Xiaopeng Technology”are to Guangzhou Xiaopeng Motors Technology Co.,Ltd.(廣州小鵬汽車科技有限公司);-3-Table of Contents “Xintu Technology”are to Guangzhou Xin

50、tu Technology Co.,Ltd.(廣州欣圖科技有限公司);“XNGP”are to XPENG Navigation Guided Pilot,which is our full-scenario ADAS solution offering advanced driver assistance;“XOS Tianji”are to our next-generation smart in-car operating system;“XPENG,”“we,”“us,”“our company”and“our”are to XPeng Inc.and/or its subsidiar

51、ies,as the context requires;“XPower”are to our 800V electric drive system;“Yidian Chuxing”are to Guangzhou Yidian Zhihui Chuxing Technology Co.,Ltd.(廣州易點智慧出行科技有限公司);“Zhaoqing Kunpeng”are to Zhaoqing Kunpeng Motor Technology Co.,Ltd.(肇慶市鯤鵬動力有限公司);“Zhaoqing Xiaopeng New Energy”are to Zhaoqing Xiaopeng

52、 New Energy Investment Co.,Ltd.(肇慶小鵬新能源投資有限公司);“Zhipeng IoV”are to Guangzhou Zhipeng IoV Technology Co.,Ltd.(廣州智鵬車聯網科技有限公司);“Zhipeng Kongjian”are to Jiangsu Zhipeng Kongjian Information Technology Co.,Ltd.(江蘇智鵬空間信息技術有限公司,formerly knownas Jiangsu Zhitu Technology Co.,Ltd.(江蘇智途科技股份有限公司);and “2019 Equi

53、ty Incentive Plan”are to the equity incentive plan of our company approved and adopted in June 2020,as amended and restatedin August 2020 and June 2021.FORWARD-LOOKING INFORMATIONThis annual report on Form 20-F contains statements of a forward-looking nature.All statements other than statements of h

54、istorical facts areforward-looking statements.These forward-looking statements are made under the“safe harbor”provision under Section 21E of the SecuritiesExchange Act of 1934,as amended,or the Exchange Act,and as defined in the Private Securities Litigation Reform Act of 1995.These statementsinvolv

55、e known and unknown risks,uncertainties and other factors that may cause our actual results,performance or achievements to be materiallydifferent from those expressed or implied by the forward-looking statements.In some cases,these forward-looking statements can be identified bywords or phrases such

56、 as“may,”“will,”“expect,”“anticipate,”“aim,”“estimate,”“intend,”“plan,”“believe,”“potential,”“continue,”“is/are likely to”or other similar expressions.The forward-looking statements included in this annual report relate to,among others:our goal and strategies;our expansion plans;our future business

57、development,financial condition and results of operations;expected changes in our revenues,costs or expenditures;the trends in,and size of,Chinas EV market;-4-Table of Contents our expectations regarding demand for,and market acceptance of,our products and services;our expectations regarding our rel

58、ationships with customers,suppliers,third-party service providers,strategic partners and otherstakeholders;competition for,among other things,capital,technology and skilled personnel,in our industry;the impact of pandemic on our business,results of operations and financial condition;changes to regul

59、atory and operating conditions in the industry and geographical markets in which we operate;and general economic and business conditions.We have based these forward-looking statements largely on our current expectations and projections about future events and financial trends thatwe believe may affe

60、ct our financial condition,results of operations,business strategy and financial needs.You should read these statements in conjunction with the risks disclosed in“Item 3.Key InformationD.Risk Factors”of this annual report andother risks outlined in our other filings with the Securities and Exchange

61、Commission,or the SEC.Moreover,we operate in an emerging and evolvingenvironment.New risks may emerge from time to time,and it is not possible for our management to predict all risks,nor can we assess the impact ofsuch risks on our business or the extent to which any risk,or combination of risks,may

62、 cause actual results to differ materially from those contained inany forward-looking statements.The forward-looking statements made in this annual report relate only to events or information as of the date on whichthe statements are made in this annual report.Except as required by law,we undertake

63、no obligation to update any forward-looking statements to reflectevents or circumstances after the date on which the statements are made or to reflect the occurrence of unanticipated events.You should read this annualreport and the documents that we have referred to in this annual report,completely

64、and with the understanding that our actual future results may bematerially different from what we expect.PART I.ITEM 1.IDENTITY OF DIRECTORS,SENIOR MANAGEMENT AND ADVISERSNot Applicable.ITEM 2.OFFER STATISTICS AND EXPECTED TIMETABLENot Applicable.ITEM 3.KEY INFORMATIONCorporate StructureThe followin

65、g diagram illustrates our corporate structure as of March 31,2024.Certain entities that are immaterial to our results of operations,business and financial condition are omitted.Except as otherwise specified,equity interests depicted in this diagram are held as to 100%.-5-Table of Contents(1)Investor

66、s in our Class A ordinary shares and ADSs are purchasing equity interest in XPeng Inc.(2)Includes(i)139 subsidiaries that are wholly-owned by Chengxing Zhidong,(ii)six subsidiaries and three limited partnerships of which a majorityequity interest is held by Chengxing Zhidong,and(iii)Zhaoqing Xiaopen

67、g New Energy,of which 100%equity interest was held by ChengxingZhidong as of December 31,2023.Chengxing Zhidong and its subsidiaries are primarily involved in research and development,manufacturingand selling our Smart EVs and providing after-sales services.Zhaoqing Xiaopeng New Energy holds an Ente

68、rprise Investment Project FilingCertificate of Guangdong Province for the Zhaoqing plant and has been listed in Announcement of the Vehicle Manufacturers and Products issuedby the MIIT,which enables it to be a qualified manufacturer of EVs.(3)Includes(i)eight subsidiaries that are wholly-owned by Gu

69、angdong Xiaopeng Automobile Industry Holdings Co.,Ltd.and(ii)two subsidiaries,of which 73.8%and 75%equity interest,respectively,is held by Guangdong Xiaopeng Automobile Industry Holdings Co.,Ltd.GuangdongXiaopeng Automobile Industry Holdings Co.,Ltd.and its subsidiaries are primarily involved in pro

70、viding value-added services.(4)50%of equity interest in Zhipeng IoV is held by us,and Mr.Heng Xia and Mr.Tao He,our co-founders,hold 40%and 10%of equity interest inZhipeng IoV,respectively.(5)50%of equity interest in Yidian Chuxing is held by us,and Mr.Xiaopeng He,our co-founder,chairman and chief e

71、xecutive officer,and Mr.HengXia hold 40%and 10%of equity interest in Yidian Chuxing,respectively.(6)Xintu Technology is wholly owned by Kuntu Technology.The ultimate holding company of Kuntu Technology is Guangzhou ChengpengTechnology Co.,Ltd.,in which Mr.Heng Xia and Mr.Tao He hold 80%and 20%equity

72、 interest,respectively.(7)GIIA is wholly owned by Guangzhou Xuetao,and Mr.Yeqing Zheng,our joint company secretary,holds 100%equity interest in GuangzhouXuetao.(8)Wholly held by XPeng Dogotix Holdings Limited through intermediary holding entities.(9)Includes three subsidiaries wholly owned by Guangd

73、ong Pengxing Intelligent Co.,Ltd.:Shenzhen Pengxing Intelligent Co.,Ltd.,ShenzhenPengxing Intelligent Research Co.,Ltd.,Shenzhen Pengxing Intelligent Technology Innovation Co.,Ltd.Guangdong Pengxing Intelligent Co.,Ltd.and its subsidiaries are primarily involved in research and development of robots

74、 with human-robot interaction functions.-6-Table of ContentsContractual Arrangements with the Group VIEs and Their ShareholdersXPeng Inc.is a Cayman Islands holding company,and the Groups operations are primarily conducted through its subsidiaries in China.XPengInc.controls these subsidiaries throug

75、h Xiaopeng Motors,which is in turn wholly owned by XPeng Inc.s Hong Kong subsidiary,XPeng(Hong Kong)Limited.The Group also conducts certain non-core and non-essential operations through contractual arrangements with the Group VIEs.Holders of ourADSs and Class A ordinary shares do not hold direct sha

76、reholding in any operating entities that are Group VIEs or their subsidiaries,but instead holdequity interest in XPeng Inc.As used in this annual report,“XPENG,”“we,”“us,”“our company”or“our”refers to XPeng Inc.and/or its subsidiaries,and“the Group”refers to XPeng Inc.,the Group VIEs and their respe

77、ctive subsidiaries.Under the PRC laws and regulations,(i)the provision of value-added telecommunication service in the PRC is subject to foreign investmentrestrictions and license requirements,and therefore,we operate such business in China through Zhipeng IoV,which is primarily engaged in the busin

78、essof development and the operation of an Internet of Vehicles(IoV)network involving the XPENG App,and Yidian Chuxing,which is primarily engagedin the business of provision of online-hailing services through online platform including the Youpeng Chuxing App;(ii)the operation of land surfacemobile su

79、rveying and preparation of true three-dimensional maps and navigation electronic maps is subject to foreign investment prohibitions andlicense requirements,and therefore,we operate such business in China through Xintu Technology and its subsidiary,Zhipeng Kongjian,which isprimarily engaged in the op

80、eration of land surface mobile surveying and preparation of true three-dimensional maps and navigation electronic maps andis in the process of renewing the Surveying and Mapping Qualification Certificate(after the Surveying and Mapping Qualification Certificate isrenewed,we plan to develop mapping a

81、nd navigation solutions that will improve customers driving experience;and(iii)the provision of insuranceagency service in the PRC is subject to foreign investment restrictions and license requirements,and therefore,we operate such business in Chinathrough GIIA,which is primarily engaged in the busi

82、ness of providing insurance agency services.As such,the VIE structure provides investors withforeign investment access to China-based operating companies where the PRC laws and regulations either restrict or prohibit direct foreign investmentin such companies.Investors may never hold equity interest

83、s in such Chinese operating companies.We have entered into a series of contractual arrangements with each of Zhipeng IoV,Yidian Chuxing,Xintu Technology and GIIA,each a GroupVIE,and its respective affiliate shareholders,including(i)power of attorney agreements,equity interest pledge agreements and l

84、oan agreements,whichprovide us with effective control over such Group VIEs;(ii)exclusive service agreements,which allow us to receive substantially all of the economicbenefits from such Group VIEs;and(iii)exclusive option agreements,which provide us with exclusive options to purchase all or part of

85、the equityinterests in or all or part of the assets of or inject registered capital into such Group VIEs when and to the extent permitted by PRC law.For details ofsuch contractual arrangements,see“Item 4.Information on the CompanyC.Organizational StructureContractual Agreements with the VIEs andThei

86、r Shareholders.”As a result of these contractual arrangements,we maintain a controlling financial interest as the primary beneficiary of the GroupVIEs for accounting purposes(as defined in US GAAP,ASC 810).We have consolidated their financial results in our consolidated financial statementswithout o

87、wning a majority equity interest in Zhipeng IoV or Yidian Chuxing or any equity interest in Xintu Technology or GIIA.The Group VIEs donot have a material contribution to the Groups results of operations and the Group VIEs do not support material revenues reported within othersubsidiaries of our comp

88、any.The contractual arrangements with the Group VIEs and the respective affiliate shareholders of the Group VIEs may not be as effective as directownership in providing us with control over the Group VIEs and involve unique risks to investors.If any of the Group VIEs or the respective affiliateshare

89、holders of the Group VIEs fails to perform their obligations under the contractual arrangements,we may have to incur substantial costs and expendadditional resources to enforce such arrangements in reliance on legal remedies under the PRC law.These remedies may not always be effective,particularly i

90、n light of uncertainties in the PRC legal system.There are very few precedents and little formal guidance as to how contractualarrangements in the context of a variable interest entity should be interpreted or enforced under PRC law.Our contractual arrangements have not beentested in the PRC courts.

91、Furthermore,the Chinese regulatory authorities could disallow the VIE structure,and we may not be able to continue to obtain,hold,renew or maintain certain required permits or approvals.If we are unable to assert our control over the assets of the Group VIEs,we mayexperience disruptions to our busin

92、ess or be unable to continue to consolidate the financial results of the Group VIEs in our financial statements,whichmay result in a material change in our operations and/or decline in the value of our Class A ordinary shares and ADSs.See“Item 3.Key InformationD.Risk FactorsRisks Relating to Our Cor

93、porate StructureWe rely on contractual arrangements with the Group VIEs and their respective affiliateshareholders to operate certain businesses that do not have and are not expected in the foreseeable future to have material revenue contributions to theGroup.Such contractual arrangements may not be

94、 as effective as direct ownership in providing operational control and otherwise have a materialadverse effect as to our business.”-7-Table of ContentsOperations in ChinaThe Group faces various legal and operational risks and uncertainties associated with being based in and having its operations pri

95、marily in Chinaand the countrys complex and evolving laws and regulations.These risks could result in a material change in the Groups operations and/or the value ofour ADSs and Class A ordinary shares or could significantly limit or completely hinder our ability to offer or continue to offer securit

96、ies to investors andcause the value of such securities to significantly decline or be worthless.For example,the Group has incurred,and will continue to incur,significantexpenses to comply with laws and regulations relating to cybersecurity and data security,including those implemented recently by Ch

97、inas government.The Group also faces risks associated with regulations on offerings conducted overseas by and foreign investment in China-based issuers,the use of theGroup VIEs,and anti-monopoly regulatory actions,which may impact the Groups ability to conduct certain businesses,accept foreign inves

98、tments,orlist on a U.S.or other foreign exchange outside of China.See“Item 3.Key InformationD.Risks FactorsRisks Relating to Doing Business inChina.”Furthermore,the PRC authorities have recently promulgated new or proposed laws and regulations to further regulate securities offerings that areconduct

99、ed overseas by China-based issuers.For more detailed information,see“Item 4.Information on the CompanyB.Business OverviewRegulationsRegulations on M&A Rules and Overseas Listings”and“Item 4.Information on the CompanyB.Business OverviewRegulationsRegulation Related to Internet Security and Privacy Pr

100、otection”.According to these new laws and regulations and the draft laws and regulations ifenacted in their current forms,in connection with our future offshore offering activities,we may be required to fulfill filing,reporting procedures with orobtain approval from the CSRC,and may be required to g

101、o through cybersecurity review by the PRC authorities.On November 16,2023 andDecember 11,2023,we have submitted the filings with the CSRC with respect to our placement of Class A ordinary shares to DiDi and VolkswagenGroup,respectively.For details of these transactions,please see“Item 3.Key Informat

102、ionD.Risk FactorsRisks Relating to Our Business andIndustryFrom time to time we may evaluate and potentially consummate strategic investments or acquisitions,which could require significantmanagement attention,disrupt our business and adversely affect our financial results.”However,we cannot assure

103、you that we can obtain the requiredapproval or accomplish the required filing or other regulatory procedures in a timely manner,or at all.See“Item 3.Key InformationD.Risk FactorsRisks Relating to Our Business and IndustryActual or alleged failure to comply with laws,regulations,rules,policies and ot

104、her obligations regardingprivacy,data protection,cybersecurity and information security could subject us to significant reputational,financial,legal and operationalconsequences,”“Item 3.Key InformationD.Risk FactorsRisks Relating to Our Business and IndustryChanges and developments in the PRClegal s

105、ystem and the interpretation and enforcement of PRC laws,rules and regulations may subject us to uncertainties.”and“Item 3.Key InformationD.Risks FactorsRisks Relating to Our Corporate StructureUncertainties exist with respect to the interpretation and implementation of theForeign Investment Law and

106、 its implementing rules and how they may impact our business,financial condition and results of operations.”PRC Permissions and ApprovalsAs of the date of this annual report,we have obtained all requisite permissions and approvals that are material to the Groups operations in Chinaas of the date her

107、eof,and Zhaoqing Xiaopeng New Energy,as well as our Smart EVs(the P5,the P7,the G9,the G6 and the X9),has been listed inAnnouncement of the Vehicle Manufacturers and Products issued by the MIIT,which represented the governmental approval required for ZhaoqingXiaopeng New Energy to be a qualified man

108、ufacturer for the manufacturing and sales of our Smart EVs.Given the uncertainties regardinginterpretation,implementation and enforcement of relevant rules and regulations,as well as other factors beyond our control,we cannot assure you thatwe have obtained or will be able to obtain and maintain all

109、 requisite licenses,permits,filings and registrations.See“Item 3.Key InformationD.RiskFactorsRisks Relating to Our Business and IndustryCertain of our operating subsidiaries may be required to obtain additional licenses or permits ormake additional filings or registrations.”-8-Table of ContentsHoldi

110、ng Foreign Companies Accountable ActThe HFCA Act,may affect our ability to maintain our listing on the NYSE.Among other things,the HFCA Act provides if the SEC determinesthat we have filed audit reports issued by a registered public accounting firm that has not been subject to inspection by the PCAO

111、B,for two consecutiveyears,the SEC shall prohibit our securities from being traded on a national securities exchange or in the over the counter trading market in the U.S.Inthe event of such determination by the SEC,the NYSE would delist our ADSs.In December 2021,the PCAOB made its determinations,or

112、the 2021determinations,pursuant to the HFCA Act that it was unable to inspect or investigate completely registered public accounting firms headquartered inmainland China or Hong Kong including our independent auditor.After we filed our annual report on Form 20-F for the fiscal year ended December 31

113、,2021 on April 28,2022,the SEC conclusively identified us as an SEC-identified issuer on May 26,2022.On December 15,2022,the PCAOB issued areport that vacated its December 16,2021 determination and removed mainland China and Hong Kong from the list of jurisdictions where it is unable toinspect or in

114、vestigate completely registered public accounting firms.For this reason,we were not identified as a SEC-identified issuer under the HFCAAct after we filed the annual report on Form 20-F for the year ended December 31,2022 and we do not expect to be identified as a SEC-identified issuerunder the HFCA

115、 Act after we file this annual report on Form 20-F for the year ended December 31,2023.Each year,the PCAOB will determinewhether it can inspect and investigate completely audit firms in mainland China and Hong Kong,among other jurisdictions.If PCAOB determines in thefuture that it no longer has full

116、 access to inspect and investigate completely accounting firms in mainland China and Hong Kong and we continue to usean accounting firm headquartered in one of these jurisdictions to issue an audit report on our financial statements filed with the SEC,we would beidentified as a SEC-identified issuer

117、 following the filing of the annual report on Form 20-F for the relevant fiscal year.There can be no assurance thatwe would not be identified as a SEC-identified issuer for any future fiscal year,and if we were so identified for two consecutive years,we wouldbecome subject to the prohibition on trad

118、ing under the HFCA Act.See“Item 3.Key InformationD.Risks FactorsRisks Relating to Doing Businessin ChinaIf the PCAOB determines that it is unable to inspect or investigate completely our auditor at any point in the future for two consecutive years,our ADSs may be prohibited from trading in the Unite

119、d States under the Holding Foreign Companies Accountable Act,as amended,or the HFCA Act,and any such trading prohibition on our ADSs or threat thereof may materially and adversely affect the price of our ADSs and value of yourinvestment.”Restrictions on Transfer of FundsXPeng Inc.is a holding compan

120、y with no material operations of its own.We conduct our operations in China(i)primarily through our PRCsubsidiaries,and(ii)to a much lesser extent,the Group VIEs.As a result,although other means are available for us to obtain financing at the holdingcompany level,XPeng Inc.s ability to pay dividends

121、,if any,to the shareholders and ADSs investors and to service any debt we may incur will dependupon dividends paid by our PRC subsidiaries and service fees paid by the Group VIEs.If any of our subsidiaries incurs debt on its own behalf in thefuture,the instruments governing such debt may restrict it

122、s ability to pay dividends to XPeng Inc.Under PRC laws and regulations,our PRCsubsidiaries are subject to certain restrictions with respect to paying dividends or otherwise transferring any of their net assets offshore to us.Inparticular,under PRC laws,rules and regulations,each of our subsidiaries

123、incorporated in China is required to set aside at least 10%of its net incomeeach year to fund certain statutory reserves until the cumulative amount of such reserves reaches 50%of its registered capital.These reserves,togetherwith the registered capital,are not distributable as cash dividends.In add

124、ition,the PRC Enterprise Income Tax Law and its implementing rules impose awithholding income tax as much as 10%on dividends distributed by a foreign invested enterprise to its immediate holding company outside of China,unless such tax is reduced under treaties or arrangements between the PRC centra

125、l government and governments of other countries or regions where thenon-PRC resident enterprise is a tax resident.The undistributed earnings that are subject to dividend tax are expected to be indefinitely reinvested for theforeseeable future.-9-Table of ContentsFurthermore,we are subject to restric

126、tions on currency exchange.The Renminbi is currently convertible under the“current account,”whichincludes dividends,trade and service-related foreign exchange transactions,but not under the“capital account,”which includes foreign directinvestment and loans,including loans we may secure from our PRC

127、subsidiaries.Currently,our PRC subsidiaries may purchase foreign currency forsettlement of“current account transactions,”including payment of dividends to us,by complying with certain procedural requirements.However,therelevant PRC governmental authorities may limit or eliminate our ability to purch

128、ase foreign currencies in the future for current account transactions.Foreign exchange transactions under the capital account remain subject to limitations and require approvals from,or registration with,the SAFE andother relevant PRC governmental authorities.Since a significant amount of our future

129、 revenues and cash flow will be denominated in Renminbi,anyexisting and future restrictions on currency exchange may limit our ability to utilize cash generated in Renminbi to fund our business activities outsideof the PRC or pay dividends in foreign currencies to our shareholders,including holders

130、of the Class A ordinary shares and/or ADSs,and may limit ourability to obtain foreign currency through debt or equity financing for our onshore subsidiaries.Since inception,we have not declared or paid any dividends on our ordinary shares or ADSs.We do not have any present plan to declare or payany

131、dividends on our ordinary shares or ADSs in the foreseeable future.We intend to retain most,if not all,of our available funds and any futureearnings to operate and expand our business.See“Item 8.Financial InformationA.Consolidated Statements and Other Financial InformationDividend Policy.”None of ou

132、r subsidiaries nor any Group VIE has declared any dividends or made distributions to its shareholder for each of the yearspresented in this annual report.The service fees charged between the Group VIEs and other entities within the Group were immaterial for each of theyears presented in this annual

133、report.For certain Cayman Islands,PRC,Hong Kong and United States federal income tax considerations of an investment in the ADSs and Class Aordinary shares,see“Item 10.Additional InformationE.Taxation.”A.ReservedB.Capitalization and IndebtednessNot Applicable.C.Reasons for the Offer and Use of Proce

134、edsNot Applicable.D.Risk FactorsSummary of Risk FactorsInvesting in our ADSs and Class A ordinary shares involves significant risks.You should carefully consider all of the information in this annualreport before making an investment in our ADSs and Class A ordinary shares.Below please find a summar

135、y of the principal risks we face,organizedunder relevant headings.Risks Relating to Our Business and Industry We have a limited operating history and face significant challenges as a new entrant into our industry.As we continue to grow,we may not be able to effectively manage our growth,which could

136、negatively impact our brand and financialperformance.Chinas passenger vehicle market is highly competitive,and demand for EVs may be cyclical and volatile.Our research and development efforts may not yield expected results.-10-Table of Contents If our Smart EVs,including software systems,fail to off

137、er a good mobility experience and meet customer expectations,our business,results of operations and reputation would be materially and adversely affected.We may be subject to risks associated with ADAS technologies.We may not be able to expand our physical sales network cost-efficiently,and our fran

138、chise model is subject to a number of risks.Our financial results may vary significantly from period to period due to the seasonality of our business and fluctuations in our operatingcosts.We depend on revenues generated from a limited number of Smart EV models.Our customers may cancel their orders

139、despite their deposit payment and online confirmation.The shortage in the supply of semiconductors may be disruptive to the Groups operations and adversely affect our business,results ofoperations and financial condition.We have incurred significant losses and had recorded negative cash flows from o

140、perating activities in the past,all of which may continue inthe future.Our business plans require a significant amount of capital.If we fail to obtain required external financing to sustain our business,we maybe forced to curtail or discontinue the Groups operations.In addition,our future capital ne

141、eds may require us to sell additional equity ordebt securities that may dilute our shareholders or introduce covenants that may restrict the Groups operations or our ability to paydividends.From time to time we may evaluate and potentially consummate strategic investments or acquisitions,which could

142、 require significantmanagement attention,disrupt our business and adversely affect our financial results.We have entered into collaborations,and may establish or seek collaborations,and we may not timely realize the benefits of sucharrangements.The unavailability,reduction or elimination of governme

143、nt and economic incentives or government policies that are favorable for newenergy vehicles and domestically produced vehicles could materially and adversely affect our business,financial condition and results ofoperations.Actual or alleged failure to comply with laws,regulations,rules,policies and

144、other obligations regarding privacy,data protection,cybersecurity and information security could subject us to significant reputational,financial,legal and operational consequences.Forinstance,any misuse of smart technology,such as facial recognition technology,may have a material adverse effect on

145、our reputation andresults of operations.Risks Relating to Doing Business in China Changes and developments in the political,economic and social policies of the PRC government may materially and adversely affect ourbusiness,financial condition and results of operations and may result in our inability

146、 to sustain our growth and expansion strategies.TheChinese government may intervene or influence the Groups operations if we fail to comply with applicable PRC laws,regulations orregulatory requirements,and may exert more control over offerings conducted overseas and foreign investment in China-base

147、d issuers,which could result in a material change in the Groups operations and the value of our Class A ordinary shares and ADSs.Any actions bythe Chinese government to exert more oversight and control over offerings that are conducted overseas and/or foreign investment in China-based issuers could

148、significantly limit or completely hinder our ability to offer or continue to offer our Class A ordinary shares and ADSsto investors and cause the value of such securities to significantly decline or be worthless.-11-Table of Contents For instance,on February 17,2023,the China Securities Regulatory C

149、ommission,or the CSRC,promulgated the Trial AdministrativeMeasures of Overseas Securities Offering and Listing by Domestic Companies(“Overseas Listing Trial Measures”)and relevant fiveguidelines,which became effective on March 31,2023.The Overseas Listing Trial Measures impose filing requirements on

150、 both“direct”and“indirect”overseas offering or listing of PRC domestic companies.As of the date of this annual report,we have not been informed byany PRC governmental authority of any requirement that we shall apply for approval or filing for our initial public offering in the U.S.inAugust 2020,our

151、follow-on public offering completed in December 2020 or our listing on the Hong Kong Stock Exchange and theassociated public offering in July 2021.However,since the PRC authorities have promulgated new laws and regulations recently to furtherregulate securities offerings that are conducted overseas,

152、in connection with our future overseas securities offering or listing,we may berequired to fulfill filing,reporting procedures or other administrative procedures with the CSRC or other PRC government authorities.Inaddition,we cannot guarantee that new rules or regulations promulgated in the future w

153、ill not impose any additional requirement on us orotherwise to tighten the regulations on PRC companies seeking overseas listing.Any failure to obtain the relevant approval or complete thefilings and other relevant regulatory procedures may subject us to regulatory actions or other penalties from th

154、e CSRC or other PRCregulatory authorities,which may have a material adverse effect on our business,operations or financial conditions.Changes and developments in the PRC legal system and the interpretation and enforcement of PRC laws,rules and regulations may subjectus to uncertainties.The audit rep

155、ort included in this annual report is prepared by an auditor located in a jurisdiction which the U.S.Public CompanyAccounting Oversight Board was unable to inspect and investigate completely before 2022 and,as such,our investors have been deprivedof the benefits of such inspections in the past,and m

156、ay be deprived of the benefits of such inspections in the future.If the PCAOB determines that it is unable to inspect or investigate completely our auditor at any point in the future for two consecutiveyears,our ADSs may be prohibited from trading in the United States under the Holding Foreign Compa

157、nies Accountable Act,as amended,or the HFCA Act,and any such trading prohibition on our ADSs or threat thereof may materially and adversely affect the price of ourADSs and value of your investment.Certain PRC regulations establish procedures for acquisitions conducted by foreign investors that could

158、 make it more difficult for us togrow through acquisitions.PRC regulations relating to investments in offshore companies by PRC residents may subject our PRC-resident beneficial owners or ourPRC subsidiaries to liability or penalties,limit our ability to inject capital into our PRC subsidiaries or l

159、imit our PRC subsidiaries abilityto increase their registered capital or distribute profits.Risks Relating to Our Corporate Structure Revenue contributions from the Group VIEs have not been and are not expected in the foreseeable future to be material.Nonetheless,if thePRC government deems that the

160、contractual arrangements in relation to the Group VIEs do not comply with PRC regulatory restrictions onforeign investment in the relevant industries,or if these regulations or the interpretation of existing regulations change in the future,ourClass A ordinary shares and ADSs may decline in value if

161、 we are unable to assert our contractual control rights over the assets of theGroup VIEs.-12-Table of Contents We rely on contractual arrangements with the Group VIEs and their respective affiliate shareholders to operate certain businesses that donot have and are not expected in the foreseeable fut

162、ure to have material revenue contributions to the Group.Such contractual arrangementsmay not be as effective as direct ownership in providing operational control and otherwise have a material adverse effect as to ourbusiness.Our contractual arrangements with the Group VIEs may result in adverse tax

163、consequences to us.If we exercise the option to acquire equity ownership of the Group VIEs,the ownership transfer may subject us to certain limitations andsubstantial costs.The affiliate shareholders of the Group VIEs may have potential conflicts of interest with us,which may materially and adversel

164、y affectour business and financial condition.Risks Relating to Our Business and IndustryWe have a limited operating history and face significant challenges as a new entrant into our industry.We began operations in 2015 and have a limited operating history.We have limited history in most aspects of o

165、ur business operations,includingdesigning,testing,manufacturing,marketing and selling our Smart EVs,as well as offering our services.We started production of our first mass-produced Smart EV,the G3,a compact SUV,in November 2018.We have constructed a manufacturing plant in Zhaoqing,Guangdong provinc

166、e,and theplant is the first manufacturing facility owned by us.We have also constructed a manufacturing plant in Guangzhou,Guangdong province,and startedmanufacturing Smart EVs at this plant in December 2022.We started production of our second mass-produced Smart EV,the P7,a sports sedan,at theZhaoq

167、ing plant in May 2020.We unveiled the P5,our third Smart EV and a family sedan,in April 2021,and started delivery in September 2021.Furthermore,we introduced the G3i,which is the mid-cycle facelift version of the G3,in July 2021,and started delivery in August 2021.In September2022,we launched the G9

168、,which is our fourth Smart EV and a mid-to large-sized SUV,and started mass delivery in October 2022.In March 2023,weintroduced the P7i,which is the mid-cycle facelift version of the P7,and started delivery during the same month.In June 2023,we launched the G6,which is our fifth Smart EV,and started

169、 delivery to customers in July 2023.In January 2024,we launched the X9,which is our sixth Smart EV,andstarted delivery during the same month.You should consider our business and prospects in light of the risks and challenges we face as a new entrant into our industry,including,amongother things,with

170、 respect to our ability to:design and produce safe,reliable and quality vehicles on an ongoing basis;build a well-recognized and respected brand;expand our customer base;properly price our products and services;advance our technological capabilities in key areas,such as ADAS,intelligent operating sy

171、stem,electric powertrain and E/E architecture;successfully market our Smart EVs and our services,including our ADAS and various value-added services,such as insurance agencyservice,automotive loan referral and charging solutions;improve operating efficiency and economies of scale;-13-Table of Conten

172、ts operate our manufacturing plant in a safe and cost-efficient manner;attract,retain and motivate our employees;anticipate and adapt to changing market conditions,including changes in consumer preferences and competitive landscape;and navigate a complex and evolving regulatory environment.If we fai

173、l to address any or all of these risks and challenges,our business may be materially and adversely affected.Our Smart EVs are highlytechnical products that require ongoing maintenance and support.As a result,consumers will be less likely to purchase our Smart EVs if they are notconvinced that our bu

174、siness will succeed or that the Groups operations will continue for many years.Similarly,suppliers and other third parties will beless likely to invest time and resources in developing business relationships with us if they are not convinced that our business will succeed.As we continue to grow,we m

175、ay not be able to effectively manage our growth,which could negatively impact our brand and financial performance.We have experienced significant growth in the past several years.Our revenues increased from RMB20,988.1 million in 2021 toRMB26,855.1 million in 2022,and further to RMB30,676.1 million

176、in 2023,and the number of Smart EVs delivered by us increased from 98,155 unitsin 2021 to 120,757 units in 2022 and further to 141,601 units in 2023.We plan to further grow our business by,among other things,investing intechnology,expanding our product portfolio,strengthening our brand recognition,e

177、xpanding our sales and marketing network and service offerings.Ourfuture operating results will depend to a large extent on our ability to manage our expansion and growth successfully.Risks that we face in undertaking this expansion include,among others:managing a larger organization with a greater

178、number of employees in different divisions;controlling expenses and investments in anticipation of expanded operations;establishing or expanding design,manufacturing,sales and service facilities,as well as charging network;implementing and enhancing administrative infrastructure,systems and processe

179、s;and executing our strategies and business initiatives successfully.Any failure to manage our growth effectively could materially and adversely affect our business,prospects,results of operations and financialcondition.Chinas passenger vehicle market is highly competitive,and demand for EVs may be

180、cyclical and volatile.Chinas passenger vehicle market is large yet competitive,and we have strategically focused on offering Smart EVs for the mid-to high-endsegment.We directly compete with other pure-play EV companies,especially those targeting the mid-to high-end segment.To a lesser extent,our Sm

181、artEVs also compete with(i)NEVs,which include EVs,plug-in hybrid electric vehicles,hybrid electric vehicles and fuel cell electric vehicles,and(ii)ICE vehicles in the mid-to high-end segment offered by traditional OEMs.We may also in the future face competition from new entrants that willincrease th

182、e level of competition.Many of our current and potential competitors,particularly international competitors,have more financial,technical,manufacturing,marketing and other resources than we do,and may be able to devote significant resources to the design,development,manufacturing,distribution,promot

183、ion,sale and support of their products.We expect competition in our industry to intensify in the future in light of increased demand and regulatory push for alternative fuel vehicles,continuing globalization and consolidation in the worldwide automotive industry.Factors affecting competition include

184、,among others,product qualityand features,innovation and development time,pricing,reliability,safety,energy efficiency,sales and marketing capabilities,distribution network,customer service and financing terms.Increased competition may lead to lower vehicle unit sales and increased inventory,which m

185、ay result indownward price pressure and adversely affect our business,financial condition,operating results and prospects.There can be no assurance that we willbe able to compete successfully.Our competitors may introduce new vehicles or services that surpass the quality or performance of our Smart

186、EVs orservices,which would adversely affect our competitive position in the market.They may also offer vehicles or services at more competitive prices,which would have an adverse impact on our sales and profitability.We have witnessed increasing price competition in the Smart EV industry in recentye

187、ars,which imposed downward pressure on the sale prices of our products and our gross margin.For instance,since January 2024,certain of ourcompetitors have announced price cuts or discounts to their products and we have also announced price discounts to certain of our vehicle models.However,we cannot

188、 assure you that we will be able to compete successfully in price against our competitors,nor can we assure you that the competitivepressures we face currently will not decrease our revenue and profits in the future.In addition,we may compete with state-owned enterprises orcompanies that have receiv

189、ed investments or other forms of support from state-owned enterprises or other government entities,and such competitorsmay therefore possess more resources than us.If products from our competitors successfully compete with or surpass the quality or performance of ourvehicles at more competitive pric

190、es,our profitability and results of operations may be materially and adversely affected.-14-Table of ContentsIn addition,volatility in the automobile industry may materially and adversely affect our business,prospects,operating results and financialcondition.The sales volume of EVs in the mid-to hig

191、h-end segment in China may not grow at the rate that we expect,or at all.Demand for EVsdepends to a large extent on general,economic,political and social conditions in a given market and the introduction of new vehicles and technologies.As a new entrant to the EV market,we have fewer financial resou

192、rces than more established OEMs to withstand changes in the market and disruptionsin demand.Demand for our Smart EVs may also be affected by factors directly impacting automobile price or the cost of purchasing and operatingautomobiles,such as sales and financing incentives,prices of raw materials a

193、nd components,cost of oil and gasoline and governmental regulations,including tariffs,import regulation and sales taxes.Volatility in demand may lead to lower vehicle unit sales and increased inventory,which may resultin further downward price pressure and adversely affect our business,prospects,fin

194、ancial condition and operating results.These effects may have amore pronounced impact on our business given our relatively smaller scale and less financial resources as compared to many traditional OEMs.Our research and development efforts may not yield expected results.Technological innovation is c

195、ritical to our success,and we strategically develop most of key technologies in-house,such as ADAS,intelligentoperating system,powertrain and E/E architecture.We have been investing heavily on our research and development efforts.In 2021,2022 and 2023,our research and development expenses amounted t

196、o RMB4,114.3 million,RMB5,214.8 million and RMB5,276.6 million,respectively.Our researchand development expenses accounted for 19.6%,19.4%and 17.2%of our total revenues for 2021,2022 and 2023,respectively.The EV industry isexperiencing rapid technological changes,and we need to invest significant re

197、sources in research and development to lead technological advances inorder to remain competitive in the market.Therefore,we expect that our research and development expenses will continue to be significant.Furthermore,research and development activities are inherently uncertain,and there can be no a

198、ssurance that we will continue to achieve technologicalbreakthroughs and successfully commercialize such breakthroughs.As a result,our significant expenditures on research and development may notgenerate corresponding benefits.If our research and development efforts fail to keep up with the latest t

199、echnological developments,we would suffer adecline in our competitive position.For example,we believe ADAS is a key factor that differentiates our Smart EVs from competing products,and wehave dedicated significant research and development efforts in this area.Any delay or setbacks in our efforts to

200、improve ADAS capabilities couldmaterially and adversely affect our business,reputation,results of operations and prospects.Besides our in-house expertise,we also rely on certain technologies of our suppliers to enhance the performance of our Smart EVs.In particular,we do not manufacture battery cell

201、s or semiconductors,which makes us dependent upon suppliers for the relevant technologies.As technologies change,we plan to upgrade our existing models and introduce new models in order to provide Smart EVs with the latest technologies,including battery cells andsemiconductors,which could involve su

202、bstantial costs and lower our return on investment for existing models.There can be no assurance that we willbe able to equip our Smart EVs with the latest technologies.Even if we are able to keep pace with changes in technologies and develop new models,ourprior models could become obsolete more qui

203、ckly than expected,potentially reducing our return on investment.If our Smart EVs,including software systems,fail to offer a good mobility experience and meet customer expectations,our business,results ofoperations and reputation would be materially and adversely affected.We tailor our Smart EVs for

204、 Chinas middle-class consumers.Our Smart EVs offer smart technology functions,including ADAS and smartconnectivity,to make the mobility experience more convenient.There can be no assurance that we will be able to continue to enhance such smarttechnology functions and make them more valuable to our t

205、arget customers.In the design process,we pay close attention to the preferences of our targetcustomers.However,there can be no assurance that we are able to accurately identify consumer preferences and effectively address such preferences inour Smart EVs design.Furthermore,the driving experience of

206、a Smart EV is different from that of an ICE vehicle,and our customers may experiencedifficulties in adapting to the driving experience of a Smart EV.As consumer preferences are continuously evolving,we may fail to introduce desirableproduct features in a timely manner.Our Smart EVs may contain defec

207、ts in design or manufacturing that cause them not to perform as expected or that require repair,and certainfeatures of our Smart EVs may take longer than expected to become enabled.For example,the operation of our Smart EVs is highly dependent on ourproprietary software,such as XPILOT,XNGP,Xmart OS

208、and XOS Tianji,which is inherently complex.These software systems may contain latentdefects and errors or be subject to external attacks.Additionally,we are actively adding new smart technology features to our offerings,including thesmart voice assistant in our XOS Tianji in-car operating system.The

209、se new features are subject to market acceptance,and any incident involving ourSmart EV may negatively impact the perception of our products and services and may further result in damages to our brand image and customer trust.Although we attempt to remedy any issues we observe in our Smart EVs as ef

210、fectively and rapidly as possible,such efforts may not be timely or maynot be to the satisfaction of our customers.Furthermore,while we have performed extensive internal testing on the Smart EVs we manufacture,wecurrently have a limited frame of reference by which to evaluate detailed long-term qual

211、ity,reliability,durability and performance characteristics of ourSmart EVs.We cannot assure you that our Smart EVs are free of defects,which may manifest over time.Product defects,delays or other failures of ourproducts to perform as expected could damage our reputation and result in product recalls

212、,product liability claims and/or significant warranty and otherexpenses,and could have a material adverse impact on our business,financial condition,operating results and prospects.-15-Table of ContentsWe may be subject to risks associated with ADAS technologies.We continuously upgrade our ADAS tech

213、nologies through in-house research and development.ADAS technologies are subject to risks and fromtime to time there have been accidents associated with such technologies.Although we attempt to remedy any issues we observe in our Smart EVs aseffectively and rapidly as possible,such efforts may not b

214、e timely,may hamper production or may not be to the satisfaction of our customers.Moreover,ADAS technology is still evolving and is yet to achieve wide market acceptance.The safety of ADAS technologies depends in part on driver interaction,and drivers may not be accustomed to using such technologies

215、.To the extent accidents associated with our ADAS systems occur,we could be subject toliability,government scrutiny and further regulation.In April 2023,our G9 SUV obtained the Guangzhou Intelligent Connected Vehicle Passenger TestPermit,and the testing area covered all general testing roads in Guan

216、gzhou.As the penetration and availability of our ADAS systems continues to grow,the possibility that our ADAS technologies are involved in accidents may correspondingly increase.Furthermore,accidents or defects caused by thirdparties ADAS technology may negatively affect public perception,or result

217、in regulatory restrictions,with respect to ADAS technology.Such accidentswhere our or any third partys ADAS technology is involved may be the subject of significant public attention.There also remains significantuncertainty in the legal implications to providers of emerging ADAS and autonomous drivi

218、ng technologies of traffic collisions or other accidentsinvolving such technologies,particularly given variations in legal and regulatory regimes that are emerging,and we may become liable for losses thatexceed the current industry norms as the regulatory and legal landscape develops.Our ADAS techno

219、logies may be affected by regulatory restrictions.Government safety regulations are subject to change based on a number of factors that are not within our control,including new scientific ortechnological data,adverse publicity regarding the industry,recalls,concerns regarding safety risks of autonom

220、ous driving and ADAS,accidentsinvolving our solutions or those of others,domestic and foreign political developments or considerations and litigation relating to our solutions and ourcompetitors products.Changes in government regulations,especially those relating to ADAS and autonomous driving,could

221、 adversely affect ourbusiness,results of operations,and financial condition.For example,on November 17,2023,the MIIT,the Ministry of Public Security,the Ministry ofHousing and Urban-Rural Development,and the Ministry of Transport jointly promulgated the Notice of Implementing the Pilot Program of Ac

222、cess andOn-Road Traffic of Intelligent Connected Vehicles(the“2023 Pilot Program”),which took effect on the same day.Pursuant to the 2023 Pilot Program,vehicle manufacturers are eligible for carrying out on-road testing for intelligent connected vehicles equipped with autonomous driving functions(re

223、ferred to as Level 3 autonomous driving function(conditionally automated driving)and Level 4 autonomous driving function(highly automateddriving)as provided in the Taxonomy of Driving Automation for Vehicles)and ready for mass production in restricted areas only after passing theproduct testing and

224、safety assessment conducted by the relevant authorities and obtaining the access approvals from the MIIT.In addition,onDecember 5,2023,the Ministry of Transport issued the Guidelines on Transportation Safety Services for Autonomous Vehicles(for TrialImplementation),which provides relevant guidance f

225、or vehicles which are capable of performing all dynamic driving tasks under designed operatingconditions according to relevant national standards and have obtained the access approvals from the MIIT,including but not limited to,requirements forapplication scenarios,operators of autonomous vehicles,s

226、afety and security,supervision and overall management.Furthermore,our research anddevelopment activities on ADAS are subject to regulatory restrictions on surveying and mapping,as well as driverless road testing.Any tightening ofregulatory restrictions could have a material adverse impact on our dev

227、elopment of ADAS technology.We may not be able to expand our physical sales network cost-efficiently,and our franchise model is subject to a number of risks.As of December 31,2023,our physical sales network consisted of 500 stores,covering 181 cities in China.We plan to expand our physical salesnetw

228、ork through a combination of direct stores and franchised stores,and we increased our efforts on developing our franchise network in 2023.Thisplanned expansion may not have the desired effect of increasing sales and enhancing our brand recognition in a cost-efficient manner and requirescertain adjus

229、tments in our sales and marketing operation.For our direct stores,we may need to invest significant capital and management resources to operate existing direct stores and open new ones,andthere can be no assurance that we will be able to improve the operational efficiency of our direct stores.-16-Ta

230、ble of ContentsWhile our franchise model enables us to pursue an asset-light expansion strategy,such model is also subject to a number of risks,and ourincreasing focus on developing our franchise network may result in increasing dependence on the performance of our franchisees and our ability toeffe

231、ctively manage our network of distributors.We may not be able to identify,attract and retain a sufficient number of franchisees with the requisiteexperience and resources to operate franchised stores.We rely on our agreements with franchisees and the policies and measures we have in place tomanage o

232、ur franchise network,and any violation by our franchisees on such agreements may have an adverse effect on our business.Our franchisees areresponsible for the day-to-day operation of their stores.Although we offer the same trainings and implement the same service standards for staff fromboth direct

233、stores and franchised stores,we have limited control over how our franchisees businesses are run.If our franchisees fail to deliver highquality customer service and resolve customer complaints in a timely manner,if any of their misconduct leads to damages to our brand image andreputation or if they

234、fail to maintain the requisite licenses,permits or approvals,our business could be adversely affected.In addition,our agreementswith certain of our franchisees are non-exclusive.While they are required to only sell our Smart EVs in the XPENG-branded franchised stores,they mayoperate other stores tha

235、t sell vehicles of multiple other brands.These franchisees may dedicate more resources to the stores outside of our sales networkand may not be able to successfully implement our sales and marketing initiatives.Furthermore,our franchisees may engage aggressive competitionagainst each other,resulting

236、 in cannibalization among such franchisees.Any such behavior or occurrence may harm our business,prospects,financialcondition and results of operation.We are also planning to establish a new franchise model in our collaboration with our franchisees,with the hope of building up channel inventory,acce

237、lerating the speed of delivery to end customers and further incentivizing our franchisees to perform.Under this new franchise model,the scope ofour disclosures of deliveries numbers may change in the future by including the vehicles delivered to our franchisees.The new franchise model couldpotential

238、ly negatively affect certain of our financial metrics,including,for example,revenue,gross margin and trade receivables.For example,increasing revenue contribution from our franchisees may lead to increase in our trade receivables,which our franchisees may not be able to settle in atimely manner,and

239、any deterioration in the financial position and credit profile of the franchisees may give rise to difficulties of our collection of tradereceivables.In addition,our customers may encounter customer experiences and sale prices that are inconsistent across our different stores,resulting inpotential c

240、ustomer dissatisfaction.Our financial results may vary significantly from period to period due to the seasonality of our business and fluctuations in our operating costs.Our operating results may vary significantly from period to period due to many factors,including seasonal factors that may have an

241、 effect on thedemand for our Smart EVs.Demand for new cars typically declines around the Chinese New Year holiday,while sales are generally higher in the fourthquarter of a calendar year.Our limited operating history makes it difficult for us to judge the exact nature or extent of the seasonality of

242、 our business.The cyclicality in seasonal fluctuations may continue in the foreseeable future.Accordingly,our revenue,cash flow,operating results and other keyoperating and performance metrics may vary from quarter to quarter due to the seasonal nature of the market demand.Uneven cash flow from quar

243、ter toquarter may cause additional difficulties in our efforts to manage liquidity and may materially and adversely affect our liquidity and our ability to fundand expand our business.In addition,We may record significant increase in revenues when we commence mass delivery of a new product to fulfil

244、lcustomer orders accumulated in prior periods,but we may not be able to maintain our revenues at similar levels in subsequent periods.Also,any healthpandemic or epidemics such as the COVID-19 pandemic and natural disasters such as unusually severe weather conditions in some markets may impactdemand

245、for,and our ability to manufacture and deliver,our Smart EVs.Our operating results could also suffer if we do not achieve revenues consistentwith our expectations for this seasonal demand because many of our expenses are based on anticipated levels of annual revenues.We also expect our period-to-per

246、iod operating results to vary based on our operating costs,which we anticipate will increase significantly in futureperiods as we,among other things,design and develop new models,develop new technological capabilities,ramp up our manufacturing facilities andexpand our physical sales network,as well

247、as expanding our general and administrative functions to support our growing operations.We may incursubstantial research and development and/or selling expenses when we develop and/or promote a new product in a given period without generating anyrevenue from such product until we start delivery of s

248、uch products to customers in future periods.As a result of these factors,we believe that period-to-period comparisons of our operating results are not necessarily meaningful and that these comparisons may not be indicative of future performance.Moreover,our operating results may not meet expectation

249、s of equity research analysts or investors.If this occurs,the trading price of our ADSs and/orClass A ordinary shares could fall substantially either suddenly or over time.-17-Table of ContentsWe depend on revenues generated from a limited number of Smart EV models.Our business initially depended su

250、bstantially on the sales and success of the G3,a compact SUV,which was our only mass-produced Smart EV inthe market prior to May 2020.We started the production of our second mass-produced Smart EV,the P7,in May 2020.Furthermore,we havecommenced delivering our third Smart EV model,the P5,a family sed

251、an,in September 2021.In September 2022,we launched the G9,which is ourfourth Smart EV and a mid-to large-sized SUV,and started mass delivery in October 2022.In March 2023,we introduced the P7i,which is the mid-cycle facelift version of the P7,and started delivery during the same month.In June 2023,w

252、e launched the G6,which is our fifth Smart EV,and starteddelivery to customers in July 2023.In January 2024,we launched the X9,which is our sixth Smart EV,and started delivery during the same month.Wecurrently have ceased the manufacturing and sale of the G3 as well as the G3i,which we introduced an

253、d started to deliver in 2021.Historically,automobile customers have come to expect a variety of vehicle models offered in an OEMs product portfolio and new and improved vehicle models tobe introduced frequently.In order to meet these expectations,we plan to continuously introduce new models to enric

254、h our product portfolio,as well asintroducing new versions of existing Smart EV models.To the extent our product variety and cycles do not meet consumer expectations,or cannot beproduced on our projected timelines and cost and volume targets,our future sales may be adversely affected.Given that for

255、the foreseeable future ourbusiness will depend on a limited number of models,to the extent a particular model is not well-received by the market,our sales volume could bematerially and adversely affected.This could have a material adverse effect on our business,prospects,financial condition and oper

256、ating results.Our customers may cancel their orders despite their deposit payment and online confirmation.Orders and reservations for our Smart EVs are subject to cancelation by the customer prior to the delivery of the Smart EV.Our customers maycancel their orders for many reasons beyond our contro

257、l,and we have experienced cancelation of orders in the past.In addition,customers may canceltheir orders even after they have paid deposits.The potentially long wait from the time a reservation is made until the time the Smart EV is deliveredcould also impact customer decisions on whether to ultimat

258、ely make a purchase,due to potential changes in preferences,competitive developments,andother factors.If we encounter delays in the deliveries of our Smart EVs,a significant number of orders may be canceled.As a result,we cannot assureyou that orders will not be canceled and will ultimately result i

259、n the final purchase,delivery,and sale of the Smart EVs.Such cancelations could harmour business,brand image,financial condition,results of operations and prospects.The shortage in the supply of semiconductors may be disruptive to the Groups operations and adversely affect our business,results of op

260、erationsand financial condition.The automotive industry has experienced in recent years,and may continue to experience or experience in the future,a global shortage in thesupply of semiconductors.Since October 2020,the supply of semiconductors used for automotive production has been subject to a glo

261、bal shortage.Although such global semiconductor shortage has not yet had a material negative impact on the Groups operations,there is no assurance that we will beable to continue to obtain sufficient number of semiconductor-contained components at reasonable cost for the Groups operations,to the ext

262、ent thatsuch semiconductor shortage continues or occurs again in the future.In addition,we source a majority of semiconductor-contained components used byus from single-source suppliers,such as the components utilizing the semiconductors provided by NVIDIA.Should any single-source suppliers ofsemico

263、nductor-contained components become unable to meet our demand or become unwilling to do so on terms that are acceptable to us,it may takeus significant time,and we may incur significant expenses to find alternative suppliers.In October 2022,the BIS released broad changes in exportcontrols,including

264、new regulations restricting the export to China of advanced semiconductors,supercomputer technology,equipment for themanufacturing of advanced semiconductors and associated components and technology.On October 17,2023,the BIS announced additionalsemiconductor regulations expanding and enhancing expo

265、rt controls under the October 2022 regulations.While we do not expect the new regulations tomaterially affect our business,there can be no assurance that the United States or other countries will not impose more stringent export controls that mayprohibit or restrict our ability to,directly or indire

266、ctly,source semiconductor and other components and raw materials,or otherwise affect our business.It is difficult to predict what further trade-related actions the United States or other governments may take,and we may be unable to quickly andeffectively react to or mitigate such actions.If we were

267、required to utilize another supplier for semiconductor-contained components,we would need toqualify and customize the components from alternative suppliers,which could be time consuming and require substantial expenses.If we are unable tofind an alternative supplier willing and able to meet our need

268、s on terms acceptable to us on a timely basis or at all,our production and deliveries wouldbe materially disrupted,which may materially and adversely affect our business,results of operations and financial condition.-18-Table of ContentsWe have incurred significant losses and had recorded negative c

269、ash flows from operating activities in the past,all of which may continue in thefuture.We have not been profitable since our inception.The design,manufacture,sale and servicing of Smart EVs is a capital-intensive business.Wehave been incurring losses from operations since inception.We incurred net l

270、osses of RMB4,863.1 million,RMB9,139.0 million and RMB10,375.8million for 2021,2022 and 2023,respectively.We have had negative cash flows from operating activities since inception and in financial yearspreceding 2023.Net cash used in operating activities was RMB1,094.6 million and RMB8,232.4 million

271、 for 2021 and 2022,respectively.Although werecorded net cash provided by operating activities of RMB956.2 million for 2023,we cannot assure you that we will achieve or maintain such positivecash flow in the future.In addition,we have made significant up-front investments in research and development,

272、our manufacturing facilities inZhaoqing,Guangzhou and Wuhan,our sales and service network,our charging network,as well as marketing and advertising,to rapidly develop andexpand our business.We expect to continue to invest significantly in these areas to further expand our business,and there can be n

273、o assurance that wewill successfully execute our business strategies.We may not generate sufficient revenues for a number of reasons,including lack of demand for ourSmart EVs and services,increasing competition,challenging macro-economic environment,supply chain disruption,as well as other risks dis

274、cussedherein.Our ability to become profitable in the future will not only depend on our efforts to sell our Smart EVs and services but also to control our costs.If we are unable to adequately control the costs associated with the Groups operations,we may continue to experience losses and negative ca

275、sh flowsfrom operating activities in the future.We may need additional capital resources in the future if we experience changes in business condition or other unanticipated developments,or ifwe wish to pursue opportunities for investments,acquisitions,capital expenditures or similar actions.In addit

276、ion,we have not recorded net income sinceinception or positive cash flows from operating activities in financial years preceding 2023.As such,we may continue to rely on equity or debtfinancing to meet our working capital and capital expenditure requirements.If we were unable to obtain such financing

277、 in a timely manner or on termsthat are acceptable,or at all,we may fail to implement our business plans or experience disruptions in our operating activities,and our business,financial condition and results of operations would be materially and adversely affected.Our business plans require a signif

278、icant amount of capital.If we fail to obtain required external financing to sustain our business,we may be forcedto curtail or discontinue the Groups operations.In addition,our future capital needs may require us to sell additional equity or debt securities thatmay dilute our shareholders or introdu

279、ce covenants that may restrict the Groups operations or our ability to pay dividends.Our business and our future plans are capital-intensive.We will need significant capital to,among other things,conduct research anddevelopment,ramp up our production capacity and expand our sales and service network

280、.As we ramp up our production capacity and operations,wemay also require significant capital to maintain our property,plant and equipment and such costs may be greater than anticipated.We expect that ourlevel of capital expenditures will be significantly affected by user demand for our Smart EVs and

281、 services.Given we have a limited operating history,we have limited historical data on the demand for our Smart EVs and services.As a result,our future capital requirements may be uncertain and actualcapital requirements may be different from those we currently anticipate.We plan to seek equity or d

282、ebt financing to finance a portion of our capitalneeds.On December 6,2023,we completed the issuance of 94,079,255 Class A ordinary shares to Volkswagen Group for approximatelyUS$705.6 million.However,such financing might not be available to us in a timely manner or on terms that are acceptable,or at

283、 all,in the future.If wefail to obtain required additional financing to sustain our business before we are able to produce levels of revenue to meet our financial needs,we wouldneed to delay,scale back or eliminate our business plan and may be forced to curtail or discontinue the Groups operations.O

284、ur ability to obtain the necessary financing to carry out our business plan is subject to a number of factors,including general market conditionsand investor acceptance of our business plan.These factors may make the timing,amount,terms and conditions of such financing unattractive orunavailable to

285、us.In particular,recent disruptions in the financial markets and volatile economic conditions could affect our ability to raise capital.If weare unable to raise sufficient funds,we will have to significantly reduce our spending or delay or cancel our planned activities.In addition,our futurecapital

286、needs and other business reasons could require us to sell additional equity or debt securities or obtain a credit facility.The sale of additionalequity or equity-linked securities could dilute our shareholders.We may also raise equity financing through one or more of our operating subsidiaries inthe

287、 PRC.As a result,our net loss or net income would be partially attributable to the investors of such operating subsidiaries,which would affect netloss or net income attributable to shareholders of XPeng Inc.The issuance of debt securities and incurrence of additional indebtedness would result inincr

288、eased debt service obligations.Holders of any debt securities or preferred shares will have rights,preferences and privileges senior to those ofholders of our ordinary shares in the event of liquidation.Any financial or other restrictive covenants from any debt securities would restrict the Groupsop

289、erations or our ability to pay dividends to our shareholders.-19-Table of ContentsFrom time to time we may evaluate and potentially consummate strategic investments or acquisitions,which could require significant managementattention,disrupt our business and adversely affect our financial results.We

290、may evaluate and consider strategic investments,combinations,acquisitions or alliances to enhance our competitive position.Thesetransactions could be material to our financial condition and results of operations if consummated.If we are able to identify an appropriate businessopportunity,we may not

291、be able to successfully consummate the transaction and,even if we do consummate such a transaction,we may be unable toobtain the benefits or avoid the difficulties and risks of such transaction,which may result in investment losses.See“Item 4.Information on theCompany B.Business Overview Strategic T

292、ransactions.”Our past experience with any strategic investments,combinations,acquisitions oralliances may not be indicative of whether we are more or less likely to consummate these transactions in the future.Strategic investments or acquisitions will involve risks commonly encountered in business r

293、elationships,including:difficulties in assimilating and integrating the operations,personnel,systems,data,technologies,products and services of the acquiredbusiness;inability of the acquired technologies,products or businesses to achieve expected levels of revenue,profitability,productivity or other

294、benefits including the failure to successfully further develop the acquired technology;difficulties in retaining,training,motivating and integrating key personnel;diversion of managements time and resources from our normal daily operations and potential disruptions to our ongoing businesses;strain o

295、n our liquidity and capital resources;difficulties in executing intended business plans and achieving synergies from such strategic investments or acquisitions;difficulties in maintaining uniform standards,controls,procedures and policies within the overall organization;difficulties in retaining rel

296、ationships with existing suppliers and other partners of the acquired business;risks of entering markets in which we have limited or no prior experience;regulatory risks,including remaining in good standing with existing regulatory bodies or receiving any necessary pre-closing or post-closing approv

297、als,as well as being subject to new regulators with oversight over an acquired business;assumption of contractual obligations that contain terms that are not beneficial to us,require us to license or waive intellectual propertyrights or increase our risk for liability;-20-Table of Contents liability

298、 for activities of the acquired business before the acquisition,including intellectual property infringement claims,violations oflaws,commercial disputes,tax liabilities and other known and unknown liabilities;and unexpected costs and unknown risks and liabilities associated with strategic investmen

299、ts or acquisitions.Any future investments or acquisitions may not be successful,may not benefit our business strategy,may not generate sufficient revenues to offsetthe associated acquisition costs or may not otherwise result in the intended benefits.We have entered into collaborations,and may establ

300、ish or seek collaborations,and we may not timely realize the benefits of such arrangements.We have pursued and may continue to pursue strategic collaborations and strategic acquisition opportunities to increase our scale,expand ourproduct portfolios and capabilities and enhance our industry and tech

301、nical expertise.In 2023,we have entered into the VW Technical FrameworkAgreement and the DiDi Strategic Cooperation Agreement.We are in the process of implementing such cooperations,which we believe are conduciveto our business.In February 2024,we entered into the Master Agreement on Platform and So

302、ftware Strategic Technical Collaboration with theVolkswagen Group.See“Item 4.Information on the Company B.Business Overview Strategic Transactions.”However,whether such cooperationwill in fact yield the expected strategic benefits is subject to uncertainties and we may not realize the full benefits

303、of relevant strategic collaborations,including the synergies,cost savings or growth opportunities that we expect.For example,the vehicle models under the respective cooperation with theVolkswagen Group and DiDi may not achieve massive-production or customer delivery in a timely manner,or at all,and

304、the market acceptance of suchvehicle models may not be satisfactory.While there is an earn-out arrangement under the DiDi Share Purchase Agreement to incentivize our cooperationwith DiDi,the milestones under such earn-out arrangement may not be achieved.The implementation and outcome of the cooperat

305、ion depend onvarious factors,many of which may be beyond our control.Furthermore,if we are unable to maintain or expand our collaboration with our partners inthe future,our business and operating results may be materially and adversely affected.To the extent we cannot maintain any of our strategicpa

306、rtnerships,it may be very difficult for us to identify qualified alternative partners,which may divert significant management attention from existingbusiness operations and adversely impact our daily operation and client experience.The unavailability,reduction or elimination of government and econom

307、ic incentives or government policies that are favorable for new energyvehicles and domestically produced vehicles could materially and adversely affect our business,financial condition and results of operations.Our business has benefited from government subsidies,economic incentives and government p

308、olicies that support the growth of new energyvehicles.For example,each qualified purchaser of our Smart EVs enjoys subsidies from Chinas central government and certain local governments.Furthermore,in certain cities,municipal government may adopt quotas that limit the purchase of ICE vehicles but no

309、t EVs,thereby incentivizing thepurchases of EVs.On September 18,2022,the Ministry of Finance of the PRC,or the MOF,together with several other PRC government departments,issued Announcement on Continuation for the Exemption of Vehicle Purchase Tax for New Energy Vehicles,which extended the previous

310、vehiclepurchase tax exemption policy for new energy vehicles to December 31,2023.On June 19,2023,the MOF and the MIIT issued the Announcement onContinuation and Optimization for the Exemption of Vehicle Purchase Tax for New Energy Vehicles,pursuant to which new energy vehicles purchasedduring the pe

311、riod from January 1,2024 to December 31,2025 shall be exempted from the vehicle purchase tax and the exemption amount for each newenergy passenger vehicle shall not exceed RMB30,000;new energy vehicles purchased during the period from January 1,2026 to December 31,2027shall be subject to the vehicle

312、 purchase tax at a reduced rate by half and the exemption amount for each new energy passenger vehicle shall not exceedRMB15,000.Chinas central government also provides certain local governments with funds and subsidies to support the roll out of a charginginfrastructure.These policies are subject t

313、o certain limits as well as changes that are beyond our control,and we cannot assure you that future changes,ifany,would be favorable to our business.For instance,in January 2022,the MOF,together with several other PRC government departments,issued theNotice on the Fiscal Subsidy Policies for the Pr

314、omotion and Application of New Energy Vehicles for 2022,or the 2022 Subsidy Notice.The 2022Subsidy Notice provides that the subsidies for new energy vehicle purchases in 2022 will be generally lowered by 30%,and such subsidies will beeliminated at the end of 2022.The reduction and elimination of suc

315、h subsidies could adversely affect our gross margin.Furthermore,we have receivedsubsidies from certain local governments in relation to our Smart EV manufacturing bases.Any reduction or elimination of government subsidies andeconomic incentives because of policy changes,fiscal tightening or other fa

316、ctors may result in the diminished competitiveness of the EV industrygenerally or our Smart EVs in particular.In addition,as we seek to increase our revenues from vehicle sales,we may also experience an increase inaccounts receivable relating to government subsidies.Any uncertainty or delay in colle

317、ction of the government subsidies may also have an adverseimpact on our financial condition.Any of the foregoing could materially and adversely affect our business,financial condition and results of operations.-21-Table of ContentsWe may also face increased competition from foreign OEMs due to chang

318、es in government policies.For example,the tariff on imported passengervehicles(other than those originating in the United States of America)was reduced to 15%starting from July 1,2018.On June 23,2020,the NationalDevelopment and Reform Commission,or NDRC,and the Ministry of Commerce of the PRC,or the

319、 MOFCOM,promulgated the SpecialAdministrative Measures for Market Access of Foreign Investment,or the 2020 Foreign Investment Negative List,effective on July 23,2020,underwhich there is no limit on foreign ownership of new energy vehicle manufacturers.Furthermore,according to the latest revised Spec

320、ial AdministrativeMeasures for Market Access of Foreign Investment as promulgated on December 27,2021,or the 2021 Foreign Investment Negative List,whichreplaced the 2020 version and took effect from January 1,2022,there is no foreign investment restrictions on the industry of vehicle manufacturing.A

321、sa result,foreign EV competitors could build wholly-owned facilities in China without the need for a domestic joint venture partner.For example,Teslahas constructed the Tesla Giga Shanghai factory in Shanghai without a joint venture partner.These changes could increase our competition and reduceour

322、pricing advantage.Actual or alleged failure to comply with laws,regulations,rules,policies and other obligations regarding privacy,data protection,cybersecurity andinformation security could subject us to significant reputational,financial,legal and operational consequences.We have adopted strict in

323、formation security policies,and we use a variety of technologies to protect the data with which we are entrusted.Wemainly collect and store data relating to the usage of the ADAS,infotainment system,as well as data collected through our sales and services channels.To the extent we collect customer i

324、nformation,we obtain such data in accordance with applicable laws and regulations.We anonymize personal data byremoving personally identifiable information,when such information is not relevant to our business.We then analyze such information to improve ourtechnologies,products and services.We use a

325、 variety of technologies to protect the data with which we are entrusted.-22-Table of ContentsNevertheless,collection,use and transmission of customer data may subject us to legislative and regulatory burdens in China and otherjurisdictions,which could,among other things,require notification of data

326、 breach,restrict our use of such information and hinder our ability to acquirenew customers or serve existing customers.If users allege that we have improperly collected,used,transmitted,released or disclosed their personalinformation,we could face legal claims and reputational damage.We may incur s

327、ignificant expenses to comply with privacy,consumer protection andsecurity standards and protocols imposed by laws,regulations,industry standards or contractual obligations.If third parties improperly obtain and usethe personal information of our users,we may be required to expend significant resour

328、ces to resolve these problems.We are subject to various laws and regulations on privacy,data protection,cybersecurity and information security in China and other jurisdictions.See“Item 4.Information on the CompanyB.Business OverviewRegulationRegulation Related to Internet Security and Privacy Protec

329、tion”forfurther details.The interpretation and application of personal information protection laws and regulations and standards are still uncertain and evolving.We cannot assure you that relevant governmental authorities will not interpret or implement the laws or regulations in ways that negativel

330、y affect us.Wemay also become subject to additional or new laws and regulations regarding the protection of cybersecurity and information security,personalinformation or privacy-related matters in connection with our methods for data collection,analysis,storage and use.As of the date of this annual

331、report,we have not been informed by any PRC governmental authority of any requirement that we shall apply forapproval or filings for our initial public offering in the U.S.in August 2020,our follow-on public offering completed in December 2020 or our listing onthe Hong Kong Stock Exchange and the as

332、sociated public offering in July 2021.However,we are not certain whether the Revised Cybersecurity ReviewMeasures or any relevant future laws,rules or regulations will apply to our company and follow-on offerings of foreign listed companies,or whether thescope of financing activities that are subjec

333、t to the cybersecurity review may change in the future.We believe that the Group has complied with theapplicable regulations and policies that have been issued by the Cybersecurity Administration of China,or CAC,to date in all material respects.As ofthe date of this annual report,the Group has not been involved in any cybersecurity review initiated by the CAC,and the Group has not received anyinqu