Xpeng Motors Considers Building Production Line in Germany

China – Chinese automaker Xpeng will hold the global launch event for its MONA L03 model in Munich, Germany on July 16, with sales set to begin in 64 countries worldwide by 2026. On July 16, Xpeng CEO He Xiaopeng stated that the company is exploring the possibility of utilizing idle factories in Germany to produce vehicles, as major German automakers seek solutions to address overcapacity issues.

Speaking in Munich, He Xiaopeng said: "Many countries in Europe could accommodate large-scale factories," adding, "Most of them are in Germany."

Confronted with U.S. tariffs, declining profit margins for electric vehicles, and intensifying competition from Chinese manufacturers, German automakers are striving to use their industrial capacity more effectively to avoid costly plant closures—issues that carry significant economic and social consequences. Volkswagen CEO Oliver Blume mentioned in April that it might be possible to use the group’s European facilities to produce cars for German partners.

On Monday, he also informed employees that four factories in Germany may face closure as part of a large-scale workforce reduction plan. Volkswagen holds a 4.99% stake in Xpeng, and the two companies have already collaborated in China to jointly develop models tailored for the Chinese market.

For Chinese manufacturers, local production in Europe would allow them to circumvent tariffs imposed by the EU on electric vehicles made in China.

This strategy could also help reassure European policymakers, who are increasingly concerned about a potential "China Shock 2.0." The term "China Shock 2.0" refers to the rise of Chinese high-tech manufacturers, which poses challenges to many traditional industries across Europe.

Data from automotive market research firm Dataforce shows that brands such as BYD, Geely, and Chery captured nearly 11% of the European car market in May—up from less than 3% just a few years ago. Among leading Chinese EV manufacturers, Xpeng saw almost double its deliveries in Europe during the first half of this year, reaching 31,000 units, with sales in Germany nearly doubling. However, He Xiaopeng emphasized that discussions regarding potential industrial partnerships in Europe are still in the early stages.

The executive noted that Xpeng has already reached an agreement with Austrian supplier Magna Steyr to produce vehicles in Europe, while stating that the group currently aims to "increase investment in Europe."

"We are ready to collaborate with numerous partners, including Volkswagen," he said. He further added that Xpeng ultimately hopes to establish "multiple factories" in Europe, along with research and development centers focused on automobiles and robotics.

Source: rfi

Original: toutiao.com/article/1870912745270272/

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