Volkswagen extends ties with China’s Xpeng to develop new EV models, technologies

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The two carmakers will jointly develop E/E architecture at project houses in Guangzhou, where Xpeng is headquartered, and Hefei, capital of China’s Anhui state

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Xpeng’s electric vehicle (EV) G9 is seen displayed at the Xpeng booth during the first China International Supply Chain Expo (CISCE) in Beijing, China November 28, 2023. Volkswagen Group has extended its collaboration with Chinese electric vehicle Xpeng to develop systems that enhance intelligent driving abilities. Photo: Reuters

Daniel Renin Shanghai

Published: 4:45pm, 22 Jul 2024

Volkswagen Group has extended its collaboration with Chinese electric vehicle (EV) maker Xpeng with the two companies signing an agreement to develop systems that enhance intelligent driving abilities.

The two carmakers also pledged to enhance their partnership and develop new models with the aim to save costs as competition intensifies on mainland China, the world’s largest automotive market.

Xpeng announced in a Hong Kong stock exchange filing on Monday the establishment of project houses in Guangzhou, where Xpeng is headquartered, and Hefei, capital of east China’s Anhui province. These will house engineers from both companies for jointly working on the development of electrical/electronic (E/E) architecture.

An E/E system connects all in-car electronic control units (ECUs), sensors and actuators to support a smart vehicle’s capabilities of self-driving, digital connectivity and infotainment.

“With the joint development of a highly modern E/E architecture, in which both partners contribute their technological expertise, we are now taking the next step together,” said VW’s China chief executive Ralf Brandsatter. “For us at Volkswagen, this project is also the next milestone in the consistent implementation of our ‘in China for China’ strategy, with a clear focus on Chinese customers and technological innovations.”

An undated selfie of Xpeng’s co-founder and chairman He Xiaopeng and Volkswagen’s China chief executive Ralf Brandstatter. The two companies signed an agreement to develop systems that enhance intelligent driving abilities. Photo: LinkedIn

The two companies said the first car fitted with their jointly developed E/E system would roll off the assembly line within 24 months, but it did not say which badge will be emblazoned on the vehicles.