Tesla Rival XPeng Aims To Mass-Produce Flying Cars By 2026, But Regulators May Ground Takeoff

A subsidiary of Xpeng Inc. XPEV XPNGF, a Chinese electric vehicle maker and Tesla Inc.‘s TSLA rival, plans to become the world’s first mass producer of flying cars by 2026.

What Happened: Xpeng Aeroht’s “land aircraft carrier” — a modular vehicle featuring a passenger drone that unfolds from a six-wheeled van — completed its first public flight at the November Zhuhai Airshow and has reportedly secured approximately 3,000 intended orders, reported The Straits Times.

“In 2026, Xpeng plans to mass produce, for the first time, our modular flying car,” Xpeng Chairman and CEO He Xiaopeng said on Friday. The company broke ground in October on a factory designed to produce 10,000 flying cars annually when completed in the first quarter of 2026.

Priced at no more than 2 million yuan ($275,000), the vehicle accommodates four passengers in the car portion and two in the detachable drone. Initial applications will likely focus on tourism and short-haul rescue missions rather than everyday transportation.

Why It Matters: China’s government has prioritized the “low-altitude economy” — economic activity below 1,000 meters — labeling it a “new growth engine” in its 2024 annual work report. The sector, projected to reach one trillion yuan ($138 billion) by 2025, encompasses drone deliveries, air shuttles, and flying taxis.

Regulatory hurdles remain the primary challenge. He Xiaopeng cited concerns about vehicle certification, takeoff regulations, and pilot licensing requirements. “Right now, I see many problems,” he acknowledged.

Xpeng’s ADR stock on NYSE rose 6.16% to $23.60 in Friday’s trading, though analysts maintain an average price target of $17.44, suggesting a potential 37.04% downside ahead of the company’s fourth-quarter earnings report due Mar. 18.