--- title: "China's Xpeng launches EV production in Europe with Austria's Magna Steyr" type: "News" locale: "en" url: "https://longbridge.com/en/news/257473148.md" description: "Xpeng, partially owned by Volkswagen, has commenced EV production in Europe by partnering with Magna Steyr in Austria. The company is assembling G6 and G9 SUVs at Magna's Graz plant, aiming to enhance competitiveness and circumvent EU tariffs on Chinese-made EVs. This move is part of Xpeng's globalization strategy, with plans for increased localization and production. Other Chinese automakers are also expanding in Europe, leveraging their EV technologies to capture market share. Xpeng is known for its advanced autonomous driving technology, positioning it as a competitor to Tesla." datetime: "2025-09-15T09:30:00.000Z" locales: - [zh-CN](https://longbridge.com/zh-CN/news/257473148.md) - [en](https://longbridge.com/en/news/257473148.md) - [zh-HK](https://longbridge.com/zh-HK/news/257473148.md) generator: "portal-rs" --- # China's Xpeng launches EV production in Europe with Austria's Magna Steyr Xpeng, part owned by Volkswagen Group, has begun production in Europe in partnership with a contract manufacturer in Austria, as mainland Chinese electric vehicle (EV) makers make inroads into the continent and circumvent punitive tariffs. The Guangzhou-based carmaker said on Monday that it had started assembling the G6 and G9 SUVs at Magna Steyr's plant in Graz. Xpeng did not elaborate on its planned output, but added that cooperation with its partner would deepen over time. "\[The roll-out\] marked a milestone in Xpeng's globalisation strategy," the company said. "More Xpeng models will be assembled in the factory." Do you have questions about the biggest topics and trends from around the world? Get the answers with SCMP Knowledge, our new platform of curated content with explainers, FAQs, analyses and infographics brought to you by our award-winning team. Manufacturing locally will exempt Xpeng from tariffs imposed on imports of Chinese-made pure EVs in Europe, while simultaneously enhancing its competitiveness in one of the world's major automotive markets. *Xpeng and Magna Steyr staff with the first cars made at the Austrian contract manufacturer's plant in Graz. Photo: Handout alt=Xpeng and Magna Steyr staff with the first cars made at the Austrian contract manufacturer's plant in Graz. Photo: Handout>* Xpeng is currently subject to a 30.7 per cent duty in the European Union on its Chinese-made cars exported to the bloc. The company said it would initially use Magna's supply chain to build vehicles in Austria and work closely with the contract manufacturer to gradually ramp up the localisation level. "More Chinese carmakers and automotive supply-chain vendors will set up their production facilities in Europe to compete in the market banking on their EV technologies," said David Zhang, secretary general of the International Intelligent Vehicle Engineering Association. "They need to gain bigger market shares abroad to improve their profitability." BYD, the world's largest EV builder, and state-owned Chery Automobile are the only mainland Chinese carmakers that have built plants in European countries. BYD has a factory each in Turkey and Hungary, while Chery owns a plant in Spain. Last week, Stella Li, an executive vice-president of BYD, said at the IAA Mobility car show in Munich that the company was in discussions with dozens of local component manufacturers to set up a supply chain to support its growth in Europe. Separately, Contemporary Amperex Technol­ogy, the world's largest EV battery producer, plans to start operations at its €7.3 billion (US$8.6 billion) factory in Debrecen, Hungary, at the end of the year. The plant has 100 gigawatt-hours of production capacity, enough to power 2 million EVs, each with a driving range of 500km. In February last year, Xpeng signed a deal with Volkswagen to jointly develop two mid-sized battery-powered vehicles for the highly competitive Chinese market in 2026. The EVs, bearing the VW badge, will be designed and built based on "joint purchasing activities" and sharing of technologies. VW owns 5 per cent of Xpeng following a US$700 million investment in 2023. Chinese carmakers and component producers are at the vanguard of EV technology and production, bolstered by government support and consumers' willingness to embrace new innovations, according to analysts. Sales of pure electric and plug-in hybrids on the mainland accounted for more than 60 per cent of the global total in 2024, according to data from the China Passenger Car Association. Xpeng is known for its autonomous driving technology, which is believed to have the potential to take on Tesla's Full Self-Driving software. This article originally appeared in the South China Morning Post (SCMP), the most authoritative voice reporting on China and Asia for more than a century. For more SCMP stories, please explore the SCMP app or visit the SCMP's Facebook and Twitter pages. Copyright © 2025 South China Morning Post Publishers Ltd. All rights reserved. Copyright (c) 2025. South China Morning Post Publishers Ltd. 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