The shares of electric car companies including Nio, Xpeng, and Li Auto have soared this year, raising questions about whether their valuations are too high.

He Xiaopeng, chairman and CEO of Xpeng, recently expressed his views on this issue.

He believes that intelligence, high gross profit, and the changes brought about by this are the main reasons for the surge of electric car companies' stocks.

In a speech at a recent event held by Tencent, he said the market value of auto companies was previously too low. Traditional auto companies such as Toyota and Volkswagen used to be valued at only between $150 billion and $200 billion, but in many countries and regions, auto-related industries are among the largest markets.

SAIC, for example, only ranked ninth in the global auto industry when its revenue reached more than 800 billion yuan, he said.

He said that in April this year, top investors around the world were suddenly very convinced of the future of smart cars, and with top global investors leading the way, many people also started to pay more attention to the electric car industry, which has created a crazy rise in electric car stock prices this year.

Xpeng is up over 80% since its IPO in late August, Nio is up 1,130% this year, and Li Auto is up 78% since its IPO in late July.