Xpeng announced that it is evaluating options for production in Europe. Xpeng Vice President and Co-Chairman Brian Gu stated that they are examining possibilities such as contract manufacturing, partnering with existing factories or building new facilities in Europe.
Xpeng evaluates options for production in Europe
The European Union plans to impose tariffs of up to 45 percent on electric vehicles and components imported from China. These taxes could threaten automakers’ sales if China retaliates.
German carmakers such as Volkswagen and Mercedes-Benz have spoken out against the proposed tariffs, arguing that they could hurt sales in Europe. VW, which has a strategic partnership with Xpeng, emphasized that it is important to keep markets open.
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Gu emphasized the strategic importance of Europe for Xpeng’s global goals. Production in Europe will allow the company to avoid high taxes. It will also help it adapt its vehicles and brand to European consumers.
Xpeng is expanding rapidly outside China, with plans to launch in 40 countries this year. Accordingly, last month it claimed to have reached a large audience in China with its Mona sedan model and achieved record sales figures.
But continued price competition in China’s electric vehicle market is squeezing profit margins. Local production in Europe can offset some of these pressures, thanks to Xpeng’s partner VW. The company is also continuing to target the US market.
