Data security as issue to be watched
Even though XPeng delivered beautiful results in December, it was fined CNY100,000 for collecting 430,000 photos of people’s faces without permission. For the U.S. market, which values data security, many Chinese companies, including Xiaopeng, are also at risk of delisting.
According to the U.S. laws, the Holding Foreign Company Accountable Act (HFCA Act), companies listed in the U.S. are required to provide data, while according to the relevant Chinese laws, it is not possible to provide data, providing data is a violation of Chinese laws and subject to punishment, not providing data is a violation of U.S. laws, which is where the serious conflict will make it difficult for companies listed in the U.S. that have Chinese user data to deal with regulation. Delisting seems like the best option.
Xpeng believes that US delisting is not in near future
Brian Gu, president of XPeng, said the risk of forced delisting of US-listed Chinese concept stocks is a few years away. Brian said he has been closely monitoring China’s policies and is prepared for all possible risks.
He added that he believes there is still time for the Chinese and U.S. governments to reach a consensus.
But with XPeng currently dual-listed in the U.S. and Hong Kong, the company could also trade independently in Hong Kong if it eventually delists from the U.S.
XPeng previously announced global development plans, including entering Sweden, Denmark, the Netherlands and other international markets.
Notably, Xpeng is awarded the most known car newcomer of the year in Norway. Brain said that the Chinese government is supportive of XPeng’s global expansion, but thinks it is difficult to enter the U.S. market in the short term. He explained that previous attempts by car companies to enter the U.S. market have taken decades, so it is important to be well prepared before making relevant decisions.
In the future, data security cannot be ignored despite XPeng’s ongoing global expansion plans. How to balance Chinese and U.S. laws is one of the main reasons to decide whether to delist in the future.