For example, for our first generation ES6, it was launched in 2019, and it was not until 2021 that it has a rather stable and sound monthly delivery. So, we are very confident with our new products. In terms of the volume products, including ET5, ET5T, ES6 and EC6, these are 4 volume products. For the EC6, it will be delivered starting September and it will take some time for the production and the delivery ramp up. But within its own segment, it will be dominating the major market share. So, with these four models combined, we believe that its monthly volume will be stabilized at around 15,000 to 20,000 units. In terms of higher volume — higher service products like EC7, ET7 and ES7 as well as ES8, we are expecting also increments on their sales volume.
Yes, Stanley will answer the second question.
Stanley Qu: Yeah. Hi, Tim. Regarding the gross profit margin, as shown in our Q2 financials, the vehicle margin is 6.2%, similar with Q1. The key reasons are sales and production volume at a lower level, driving higher manufacturing costs and other cost allocation and also more promotions to the users and also marketing efforts during the product transition period. But along with our sales and volume ramp-up of our — all our NT2 product, our target to achieve double-digit gross profit margin in Q3 and 15% in Q4, if we can control the battery cost and other costs well.
William Li: [Foreign Language] [Interpreted] So, we have already digested the impact of the price reduction.
Tim Hsiao: Got it. Thank very much, William and Stanley. Thank you.
Stanley Qu: Thank you, Tim.
William Li: Thank you, Tim.
Operator: The next question comes from Yuqian Ding of HSBC. Please go ahead.
Yuqian Ding: Thanks, team. Yuqian here. I got two. First question is, we practically have all the models are now refreshed and then newly launched based on 2.0 platform model is a pretty comprehensive coverage. We will be expecting strong ramp-up in the coming six months in a visible way. But how do we expect the key growth drivers, if we’re looking at 12 to 18 months, especially in terms of new product? How do we fill in the already comprehensive product portfolio or the software is going to be the next leg of growth? The second question is on the OpEx side. So, this year, we have new model launches and we have the sales channel upgrade. But next year, when we’re rolling into next year, could we see the absolute OpEx value dialed down a little bit? Thank you.
William Li: [Foreign Language] [Interpreted] Thank you for your question. Regarding your first question, as you may know that starting from September, we will launch our EC6 into the market. And with that all its models on the NT2 platforms will be launched to the market. And over the past several months, we have launched five brand new models plus a facelift. In such a short timeframe, we are able to realize the high-quality deliveries of this model. This has also demonstrated our R&D efficiency as well as the strong execution. But in the meantime, we also need to realize that it’s a challenge brought by the smart electric vehicles to the entire industry as in a very short timeframe, we needed to catch up to the changes of all the smart technologies.
But in the meantime, for all the NT2 products, we are looking at more software features to be updated and released. For example, our new assisted and intelligent driving. For the coming months, we will be rolling out some new features and also services. This will help us to improve the competitiveness of the product. And also, as we’ve mentioned, we are developing the sales capabilities inside of the company so that we can reach out to broader channels with more salespersons and support the new orders of 30,000 units per month. This will also be a very concrete foundation for the continuous growth of the sales and deliveries in the coming months. If you look at our eight models on the NT2 platform, they are already covering 80% of the needs in the premium market.
And also, we have also adjusted our organizational structure starting from the third quarter. So that from the headquarters to the regional companies, we will be having dedicated teams managing and responsible for each of the model across the life cycle. This is also the efforts we’ve made from the sales and marketing perspective.
Stanley Qu: Hi, Yuqian. Regarding the OpEx of next year, the next year budget for us has not been ready. So at this moment, I may not be able to give you the precise number, but I can give you some feeling. Regarding the R&D expense, as introduced in last quarters, on average, each quarter this year, the non-GAAP R&D investments will be RMB3 billion to RMB3.5 billion for this year. I think for next year, the — we will keep similar like investment R&D activities. And regarding the SG&A expense, as explained by William, we have a relatively more aggressive sales targets for the second half of this year, I think, should be for next year. So the absolute value for SG&A will grow accordingly since we need more market activities and events.
But the percentage of total sales revenue, I think, will decline compared with the first half of this year and also the whole — I think the whole year of 2023, because of the improvements in both, I think, delivery volume and also operating efficiency. Thank you, Yuqian.
Operator: The next question comes from Jeff Chung of Citi. Please go ahead.
Jeff Chung: [indiscernible] Hello. I have two questions. First question is our refinancing plan going forward. And the second question is our cash flow projection into the third quarter and fourth quarter. So, why I am asking this is because we saw the first quarter, the net cash outflow was RMB10.6 billion, but improved to a cash outflow of RMB5.9 billion in the second quarter. And within the second quarter, we also saw the inventory Q-on-Q delta of around RMB5 billion, while the account payable — account receivable remained stable. So that said, if the third quarter inventory came down plus the operating leverage with a volume hike, whether we should see the cash outflow should be significantly narrowing further? This is my first question.
