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HEFEI – Volkswagen Group plans to invest $700 million in Xpeng and jointly develop electric vehicles in China.
The Group will hold a 4.99% stake in the Chinese manufacturer through a capital increase and will obtain a seat on the company’s board. VW Group and Xpeng will develop two battery-powered VW brand models on the MEB platform at the new technology center in Hefei, VW’s largest development location outside of Wolfsburg.
Mid-size electric vehicles will be launched in China starting in 2026. Volkswagen is looking to buck the trend in China, where Tesla and local manufacturer BYD have gained market share by producing vehicles with locally-oriented technology and software . The German company’s electric vehicle sales in China fell in the first half of the year, in a market that grew by 20%.
IlGruppo Group also announced plans for the cooperation between Audi and SAIC Motor, which includes jointly developed models and a new platform. The partnership will cover premium EVs and start with models in a segment where the brand is not yet represented in China. Both agreements are aimed at the future joint development of new local platforms for the next generation of intelligent, fully connected vehicles, the VW Group said.