Xpeng in Talks With Volkswagen Over European Factory

Chinese electric carmaker Xpeng is in talks with Volkswagen and other carmakers about a possible factory acquisition in Europe, the Financial Times reported, citing company officials.

The company is looking at ways to expand production directly in the European market, according to Elvis Cheng, Xpeng’s managing director for northeastern Europe. Xpeng is considering buying an existing plant, but has not ruled out building its own factory.

The talks come shortly after Volkswagen CEO Oliver Blume raised the possibility of deeper cooperation with Chinese partners in European production. Volkswagen owns a stake in Xpeng and already works with several Chinese manufacturers.

Cheng said not all existing factories met the technological requirements of modern electric vehicles. He described Volkswagen’s plants as “a bit old”.

Volkswagen declined to comment on the report. Blume has previously said the company is exploring ways to deal with excess production capacity in Europe, including through cooperation with Chinese partners. Europe remains strategically important for Xpeng, but entry into the market is complicated by tighter foreign investment rules and tensions between the EU and China over electric vehicles.

(reuters, max)