00:00Brian, good to have you with us. We know that you're a step closer to profitability.
00:04Those numbers are pretty encouraging. We have losses shrinking by about 50%.
00:09What will drive the momentum going forward?
00:12Yeah, I think we delivered a very strong quarter.
00:16I would say in the first quarter of this year, our delivery number, our gross profit all hit record highs.
00:23We also locked year-over-year growth over 300%,
00:27which I think, given the backdrop of the competition and economy, I think there's very strong numbers.
00:33I think all that, I think, is interpinned by a number of very strong product launches we have seen the last six months.
00:40Our Mona 03, which was launched in August last year,
00:45has now successfully delivered over 100,000 vehicles in a little bit more than half a year.
00:51And also our P7+, which is launched in November, has delivered over 50,000 since its launch.
00:59So these actually are really, you know, the important sort of catalysts for us to maintain the steady growth.
01:06But looking ahead, I think what we actually see is even more exciting growth coming
01:11because we actually have three new models soon to be launched in the next, I would say, couple quarters.
01:18And also these models are higher priced and higher margin products.
01:23So with better scale, better product mix, and also, you know, more efficiency we can gain from that,
01:30I think we are very confident we can hit profitability finally in the fourth quarter this year.
01:34You talk about better scale, better models, you talk about a higher end.
01:40Therein lies the question of whether your higher end models can do as well, can sustain the numbers.
01:46Well, I think if you look at X-Pen as a brand, we actually historically have been focused on what we call the mass premium mid to high end segments.
01:56So, for example, when we, you know, started our main product range, the P7, the G6, G9,
02:04all was in, let's say, around $200,000 to $350,000 price range.
02:08That actually has a lot of our, you know, historical customers as well as our historical product sales.
02:14Last year, we did reach down to lower price segments with Mona03.
02:19That expanded our, you know, user, I would say, target market segment.
02:25But I think the upcoming models will fall into our historical, traditional strong range.
02:31And also coupled with the new technologies that we can incorporate into these models,
02:36as well as some of the designs people have started seeing,
02:39I think it will be very, very attractive for the mid to premium segments again.
02:44We know the China market is a key market for you, but you're also wanting to internationalize.
02:50Talk to us about the strategy.
02:51You're targeting overseas markets, but not the U.S.
02:55just to put it out there.
02:57Well, we would love to sell our cars to all customers in the world.
03:02And we are obviously trying to enter into as many markets as we can.
03:07Currently, we're already entered into more than 40 countries,
03:10and we have plans to probably enter more this year.
03:14First of all, I think our product has a strong appeal to these local customers.
03:19If you look at some of the numbers, it's actually been very encouraging.
03:22The same quarter, our international sales actually grew 370% year over year.
03:28It's even faster than our domestic growth.
03:31At the same time, if you look at some of the products positioned in key markets,
03:36they're actually leading in their respective categories.
03:38For example, the G6, the mid-sized SUV, as well as the G9, the full-sized SUV.
03:43So for us, I think our goal is, one, is to make sure we diversify our global presence into more markets.
03:50At the same time, trying to introduce more products, as well as building local capabilities and skill to tackle the opportunity.
03:58Of course, you made a debut at the Shanghai Auto Show with the flying car.
04:03Where are you going with that?
04:04And realistically, what kind of pickup, what kind of interest do you foresee?
04:09Well, I think the low-altitude economy is a very big thing now in China, and I see that coming also globally.
04:16I think mobility should not be just limited to two-dimensional travel.
04:20So I think there is definitely a policy trend that's propelling the growth of a low-altitude economy, including the flying car.
04:29On the product side, we actually have our very first product that we call the Land Aircraft Carrier,
04:34which is a modular design with a car and a flying drone together in one product.
04:40We actually hope to receive final approvals by the end of this year and hope to launch to retail consumers later next year.
04:50And that will be world's first volume-produced, I would say, flying car in the market.
04:54And of course, all eyes on your chip, the Turing, I mean, is it a game-changer?
04:59Some say that perhaps it represents a deep-seek moment for the outer space in the country?
05:05Well, I think the AI chip is a very core part of our AI strategy.
05:13I think you need the funding to building blocks, and also to have that building block integrated into your overall full-stack R&D.
05:20The Turing chip is actually designed to be used with our autonomous driving software in our AI vehicles.
05:29And because the design is highly customized, so it actually shows very, very strong efficiency.
05:35So the computing power, for example, actually could be much better than the currently available chips on the market.
05:41So we're actually very excited to see that Turing chip to be volume-produced this quarter,
05:46and hopefully to be in our vehicles later this year.
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