XPeng Plans to Acquire Volkswagen's European Plant

[Capacity Layout] XPeng is in talks with Volkswagen to acquire its idle European factory to address surging sales in the European market.

Core Development: XPeng Seeks Localized Production in Europe to Overcome Capacity Constraints

Cheng Xiaoguang, Head of XPeng for Northeastern Europe, confirmed at the Financial Times' 'Future of Cars' summit that the company is negotiating with Volkswagen and other manufacturers regarding the acquisition of European factories. Currently, XPeng’s G6 and G9 models sold in Europe are contract-manufactured by Magna in Austria, but this capacity is nearing saturation.

Key Metrics: European Sales Surge 179% Year-over-Year in Q1 2026

In the first quarter of 2026, XPeng delivered 6,968 vehicles in Europe, a year-over-year increase of approximately 179%. April’s monthly sales continued this strong growth trajectory, making the current contract manufacturing model unsustainable.

Strategic Rationale: Leveraging Volkswagen’s Idle Assets to Accelerate Localization

Volkswagen CEO Oliver Blume revealed at the end of April that the company is exploring new uses for its idle European plants—such as the Transparent Factory in Dresden—including potential capacity-sharing arrangements with Chinese automakers. However, Cheng Xiaoguang candidly noted that some of these facilities are "somewhat outdated," and XPeng is also evaluating the option of building its own new plant.