On Jan. 21, Xpeng Inc. (“XPeng” or the “Company”, NYSE: XPEV, HKEX: 9868. HK) announced that Xpeng P7 has reached the first Over-The-Air technology(OTA) major upgrade. The corresponding Xmart OS version number for this upgrade is 2.7.0.
The OTA brings 12 new features and over 40 optimizations to the user experience, according to XPeng.
Some of the core functions that were enhanced included Xpeng P7’s sharable parking memorization, NGP AI assistance in driving, all scene dubbing, AI assistance in parking, and many more core functions.
Valet Parking Assist(VPA)
- One of the most significant upgrades of OTA is making the memory parking routes in VPA able to be shared.
- Users can get to their destination quickly when going to the elevator entrance of a large superstore or an underground charging station.
- Xpeng suggested that this is the first parking assistance that can share routes in the whole industry.
Navigation Guided Pilot (NGP)
- Xpeng’s NGP system, named as XPILOT, also received a major upgrade. The cost of XPLIOT will increase from CNY20,000 to CNY36,000 when bought with a car.
- Xmart OS 2.7.0 also optimises the cone bucket display strategy, off-ramp experience, and congestion following experience for the freeway Navigation Guided Pilot (NGP) startup state.
- As of January 2022, NGP has accumulated more than 20 million kilometres and has 96 percent user penetration, the company said.
AI assistance safety system
Xpeng added the new blindspot safety assistance system. This system allows a route-changing car to alarm the driver when it detects an adjacent car also trying to change its route.
OTA is an essential function in nowadays new energy vehicles(NEV). The application of OTA not only allows audio and data services to be provided online but also enables new services to be downloaded in the car.
Besides Xpeng, other companies also upgraded their OTA service:
Tesla launched a pay-required service of the backseat and steering wheel heating that costs CNY2400.
It also provides Premium vehicle connectivity, which costs USD9.9 per month, the service includes:
- a satellite real-time rendering map
- car-based audio streaming
- car-based browsers
Li Auto updated its OTA in the vehicle model ‘Li Auto ONE’ by adding
- Visual car parking service
- Navigation guided pilot
- ’Li Auto classmates’ voice command
NIO pilot, which costs CNY150,000 for the standard version and CNY390,000 for the advanced version.
As shown, classical car companies’ OTA focuses on the upgrade of car assistance, such as maps or online audio services.
New car-manufacturing companies such as Xpeng focus on extra paid services that could enhance the driving experience.
Tesla’s upgrade costs the most, while Xpeng and NIO follow it.
OTA’s importance for Xpeng
OTA is one of the main ways car companies used to decrease car maintenance costs and directly create income via software.
- The core of OTA development is similar to software development. The cost of production mainly focuses on technological advancements. Therefore, there is a high profit at about 90%, according to professionals.
- Also, OTA can have a positive influence on customers’ impression of Xpeng’s brand image. A good OTA service can increase customer loyalty and encourage repeat purchase behaviour.
Considering the fact that Xpeng’s customers concentrated on middle-aged men who have high customer loyalty but relatively low purchasing power, OTA income might be one of the most important sources of income for Xpeng.