Xpeng actively looking for a site in EU for factory

In July, as the temporary tariffs levied by the EU on imported Chinese EVs came into force, we reported that Xpeng was considering setting up a production plant in Europe. This appears to have moved a stage further. Xpeng chairman He Xiaopeng recently revealed that the company is now planning to produce EVs in Europe to reduce the impact of tariffs. Selection of the site is still in its early stages.

Xpeng was one of the companies that cooperated with the European Commission’s investigation into subsidies received by Chinese EV producers. However, it was not one of the companies individually sampled, so it is currently subject to the 20.8% tariff. Under the newly announced finalized tariffs, such companies, including Xpeng, will be subject to an increased rate of 21.3%, subject to alterations between the announcement made earlier this month and the final implementation due by November at the latest.

Xpeng began exporting to Europe in 2020, with the initial market being Norway, from which it has subsequently expanded. In an earnings call earlier this month, it was reported that Xpeng had entered a period where international sales were rapidly increasing, acting as an important driver for both sales and profit growth. For the first time in the second quarter, the contribution from overseas sales exceeded 10%. Xpeng’s flagship SUV, the G9, was the top-selling mid to large pure electric SUV in Norway and Denmark, and it was also in the top three in Sweden and the Netherlands. Already, the company has entered thirty countries and regions, including Europe, the Middle East, and Latin America.

Long range 4WD performance version of the XPeng G9 electric SUV being driven on the road in Shanghai, China.

Xpeng joins a growing list of Chinese producers actively looking at locating factories within the European Union member states, with a number of these being a direct result of the EU tariffs. Stelantis-backed Leapmotor has already begun production in Poland, and BYD is building a plant in Hungary. SAIC is due in September to make an announcement on where a new plant to produce MG-branded cars will be located.

The final tariffs due to be implemented by the EU will see Tesla subject to 9% for imports from China, BYD 17%, Geely 19.3%, cooperating producers that have not been individually sampled 21.3%, and finally SAIC and non-cooperating producers 36.3%.

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Source: Fast Technology

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