Xpeng launches first EV production in Europe

Xpeng Inc., a Chinese-based electric vehicle manufacturer, has extended its operations in Europe after partnering with Magna Steyr, a contract automobile manufacturer in Graz, Austria.

With this collaboration, Xpeng can use Magna’s plant in Graz, situated in southern Austria, to develop its vehicles. Meanwhile, in a recent announcement, the Chinese EV manufacturer made public that it had already produced the first group of G6 and G9 SUVs.

By manufacturing cars locally, Xpeng intends to avoid the European Union’s tariffs on Chinese electric vehicles imposed in 2024. As for the extra fee for production from partnering manufacturers, it is set at 20.7%. This could go as high as 35.3% for some other manufacturers.

Xpeng applies a smart business strategy in its operations to increase sales

There is a growing trend among Chinese EV companies seeking to expand their operations internationally, mainly to find better profits and capture new customers. This move has been triggered by a lengthy price war and surplus supply in their home markets. However, they are still encountering more trade obstacles as they move forward.

Manufacturing firms like Xpeng and BYD have decided to establish plants in leading markets such as Europe and Southeast Asia to avoid high tariffs. 

Apart from establishing plants in Europe, Xpeng has also developed its own research and development center in Munich. Interestingly, this center demonstrated the capability to host over a dozen Chinese automakers during the recent IAA Mobility show.

The R&D center will also accelerate Xpeng’s model production at the Magna factory and broaden its reach in the European market. Considering its smart business strategy, the Chinese-based electric vehicle manufacturer, particularly in Guangzhou, has recently achieved a significant sales rise, with 271,615 electric vehicles delivered. That is in the first eight months of the year 2025. The rise is three times the sales figures recorded in 2024.

The firm’s American depositary receipts have also increased by approximately 77% since January.

Despite these exemplary results, it is worth noting that Xpeng encountered an issue in its operation when it needed to recall several of its P7+ models due to a steering problem last week. As earlier reported by Cryptopolitan, this scenario sparked concerns about the safety and quality of its vehicles.

The problem stems from a defect in the sensor wiring harness. Vehicles produced between August 20 of last year and April 27 of this year are affected, with some potentially showing a steering fault warning light before an actual steering failure.

China intends to solidify its position as a global leader of car exports

The surge in car exports from China is greatly transforming the entire car market globally. This influx of affordable automobiles has sparked a price war that affects dealerships from Mexico to Malaysia.

Following the situation, tech analysts have highlighted that President Xi Jinping’s administration intends to withdraw from this stiff competition as it reduces profit. The People’s Daily, under the leadership of the Communist Party, also weighed in on the topic of discussion, stating that there are no winners in this competition.

Even with this, China’s automotive sector, which encounters serious challenges due to the production of many cars, has revealed that it will be hard to reverse this trend.

In the meantime, research from reliable sources has highlighted that Chinese vehicles are more noticeable on the streets of some areas in South America, while BYD’s affordable and high-quality EV brands are attracting European customers.

Ron Zheng, a partner at global consulting firm Roland Berger GmbH, acknowledged that automobile manufacturers in China are seeking better profit margins abroad. He then concluded that, while the local market feels the impact, the price competition will not be as stiff as in China.

Get seen where it counts. Advertise in Cryptopolitan Research and reach crypto’s sharpest investors and builders.