XPeng in talks to buy VW plant

XPeng is in talks with Volkswagen and other automakers about buying a factory in Europe, the Chinese electric-vehicle maker’s northeastern Europe chief said on May 14. Elvis Cheng disclosed the discussions at the Financial Times’ Future of the Car summit, according to CnEVPost and Electrek. The talks come as XPeng pushes to expand output outside China and add to its existing contract manufacturing arrangement in Austria. Volkswagen and XPeng already have a strategic relationship in China after Volkswagen bought about 4.99% of XPeng in 2023 and agreed to collaborate on smart EV development. ### What exactly did XPeng say on May 14? Elvis Cheng, XPeng’s managing director for northeastern Europe, said on Wednesday that the company was discussing with Volkswagen the possibility of finding a production location in Europe, CnEVPost reported, citing the Financial Times summit. The same report said Cheng referred to talks with Volkswagen and other automakers about buying a factory. (cnevpost.com) Electrek reported on May 14 that the discussions involved acquiring a Volkswagen plant in Europe. That report described the move as a response to rising export volumes and tightening capacity at XPeng’s current European manufacturing setup. ### Why is Europe production capacity an issue now? XPeng’s April 2026 delivery statement said the company and Magna rolled the first locally produced P7+ off the line in Graz, Austria, on April 7. (cnevpost.com) The company said the P7+ became the third model to be locally manufactured in Austria after the G6 and G9, expanding its European manufacturing footprint through partnerships. (electrek.co) Magna said in a 2025 release that XPeng’s program in Graz marked its first complete vehicle assembly business with a Chinese automaker from Magna’s Austrian operations. Magna also says its Graz site is a complete vehicle engineering and production hub, and its contract manufacturing arm can build multiple powertrain types on the same lines. (ir.xiaopeng.com) Electrek said XPeng’s contract production in Austria was running out of capacity and reported exports had surged 62%. That figure was the clearest public marker in the reports for why XPeng might seek a second manufacturing base in Europe. ### How are Volkswagen and XPeng already connected? Volkswagen Group said in July 2023 that its VW brand had concluded a technological framework agreement with XPeng as part of a broader China strategy. (magna.com) In December 2023, Volkswagen completed the purchase of roughly 4.99% of XPeng’s outstanding share capital, the companies said in a later update. (electrek.co) The partnership has since centered on China-focused smart EV development. Volkswagen said in April 2026 that it was bringing more than 20 electrified vehicles to the Chinese market in 2026 alone, including products developed under its China strategy. (volkswagen-group.com) ### Is there evidence XPeng was already looking for plants abroad? Bloomberg reported on April 24 that XPeng Chairman He Xiaopeng said the company was in talks with overseas automakers on potential cooperation and wanted to expand production outside China. Bloomberg said He also described interest in XPeng’s driver-assistance technology from European companies, domestic carmakers and parts suppliers. (volkswagen-group.com) That April report predates the May 14 disclosure about talks over a European factory. Taken together, the reports show XPeng had already been signaling interest in overseas production before Cheng’s comments this week. ### Has Volkswagen confirmed a sale or a specific plant? Volkswagen’s recent press-release pages do not show an announcement of a plant sale to XPeng. (bloomberg.com) The available reports also do not identify a specific factory, price, or signing date. CnEVPost said XPeng was talking with Volkswagen and other automakers, which suggests the company was not limiting discussions to one counterpart. (bloomberg.com) Electrek’s report was more specific in describing a Volkswagen plant, but neither report cited a signed agreement. ### What should readers watch next? XPeng’s next concrete step would be a named factory, a transaction value, or a production timetable in Europe. (volkswagen-group.com) Volkswagen’s next formal disclosures would most likely appear through its press-release channels, while XPeng has recently used delivery statements to flag manufacturing milestones such as the April 7 P7+ roll-off in Graz. (volkswagen-newsroom.com) (cnevpost.com)