Shares of Chinese Tesla rival Xpeng fall 5% after head of autonomous driving resigns

Xpeng shares fell around 5% on Wednesday after the company announced its head of autonomous driving will leave the company at what is seen as a critical juncture for the Chinese electric vehicle start-up.

Xinzhou Wu, vice president of autonomous driving at Xpeng, tendered his resignation "for personal and family reasons," Xpeng said in a statement.

Liyun Li, senior director of Xpeng's autonomous driving team, will takeover Wu's role. Li has been leading the project team behind Xpeng's advanced driver-assistance system known a XNGP. Xpeng said Li has been "prepared for the transition for a long period."

He Xiaopeng, CEO of Xpeng, praised Wu's contribution to getting Xpeng into a "leading position in autonomous driving technology."

Wu's departure comes at a time when Xpeng is looking to recover lost ground to upstart rivals Nio and Li Auto as well as trying to take on giants BYD and Tesla in China as the market gets increasingly cut-throat.

Xpeng continues to get hit by losses but delivered 11,008 vehicles in July, up by 28% on the month. It was the sixth consecutive month of delivery growth, highlighting signs of recovery to Xpeng's business.

The Guangzhou-headquartered firm has tried to position itself as more advanced on autonomous driving and other technologies than its competitors. It's main semi-autonomous driving product is XNGP which it has positioned as a rival to Tesla's Autopilot.

Xpeng's Xiaopeng sought to reassure investors that the company's technology development will continue.

"Looking forward, we will remain fully committed to our clear roadmap for the full-stack in-house developed autonomous driving technology and our strategic partnership with the Volkswagen Group," Xiaopeng said.

"I will continue to personally lead our autonomous driving team and strengthen our leadership in Smart EV technologies," the CEO added.