Top executives from Volkswagen and Xpeng pose at the German automaker’s launch event in Beijing, China, August 24, 2024.
Bloomberg | Bloomberg |
BEIJING — Hundreds of Volkswagen Employees spend time at Xpeng As the German auto giant and the Chinese startup work on developing electric cars for China, Brian Gu, co-president of Xpeng, told CNBC on Monday.
He also said the partnership will support Xpeng’s global ambitions.
Volkswagen announced a $700 million investment in Xpeng in July 2023 to jointly develop two electric cars to be delivered in China in 2026. The vehicles will be based on the platform of Xpeng’s G9, a mid-size electric crossover SUV.
The German company’s employees spend more time in Xpeng’s offices than the startup’s employees do in Volkswagen’s, Gu said. They get to know the startup’s technology.
Xpeng’s driver-assistance technology is widely considered to be among the best currently available in China. Tesla’s version, marketed as “fully autonomous,” is not fully available in China.
The German automaker did not immediately respond to a request for comment.
Gu stressed that the upcoming vehicles will be “very different” from those currently sold by Xpeng or Volkswagen. He said the cars would likely have “better range, better charging capabilities, much smarter driving and more luxury technology – and potentially at the same price.”
China is a key market for Volkswagen. The German carmaker delivered 3.2 million cars to China last year, more than the 3.1 million in all of Western Europe.
But like many traditional foreign auto giants, Volkswagen is struggling in China as the market there rapidly shifts toward pure battery and hybrid vehicles. The company’s deliveries in China fell 19.3 percent year-on-year in the quarter to June.
Although Xpeng recorded a 30% increase in deliveries to over 30,200 vehicles in the second quarter compared to the same period last year, the startup is still lagging behind many of its Chinese competitors.
Looking overseas
The company, like Chinese electric car manufacturers, has now intensified its activities abroad. BYD And NioIn the second quarter, Xpeng announced that its overseas sales exceeded 10% of total sales for the first time.
He Xiaopeng, CEO and founder of Xpeng, told Bloomberg last week that the Chinese automaker is in the preparation phase of selecting a site in the European Union as part of its future plans to localize production. The interview was published on Tuesday.
When asked for comment, Xpeng said it had announced during the Beijing Auto Show in the spring that the company was considering the possibility of overseas production.
Gu also told reporters on Monday that localization efforts in Southeast Asia would likely come sooner than in Europe.
He said the 10-year-old startup aims to reach at least 40 countries and regions by the end of this year, up from around 30 so far.
Xpeng launched in Thailand, Hong Kong and Macao earlier this month. Gu said the startup will launch in Malaysia this week and officially announce its entry into Singapore, where Xpeng has a pop-up store.
The startup also plans to enter Australia, New Zealand, the UK and Ireland, Gu said.
Partnership in the supply chain
Speaking about how the Chinese company is learning from its German partner, Gu said Xpeng employees visit Volkswagen offices in Hefei, the capital of China’s Anhui province, to talk about design and technology, and in Beijing to discuss the supply chain.
The two companies announced in February that they had launched a “joint procurement program” for auto parts.
Xpeng has been investing in robotics since 2020 and is now focusing on human-like robots that can perform multiple tasks in factories, Gu told CNBC, hinting that Xpeng will likely announce more details soon.
When asked whether this humanoid integration would also include Volkswagen’s supply chains, he said it was still too early for such an implementation.
— CNBC’s Sonia Heng contributed to this report.
