Business

EV Startup Xpeng in Talks to Buy Volkswagen's European Factory
By Reuters | 13 May, 2026

The Chinese EV maker is in talks with Volkswagen and other automakers about buying a factory in Europe just days after Volkswagen CEO Oliver Blume said the company could bring cars developed in China to Europe or share factory capacity with Chinese partners.

Chinese electric vehicle startup Xpeng is in talks with Volkswagen and other automakers about buying a factory in Europe, the Financial Times reported on Wednesday.

The development comes days after Volkswagen CEO Oliver Blume said the company could bring its cars developed in China to the European market or even share factory capacity in Europe with Chinese partners.

Elvis Cheng, Xpeng's managing director for northeastern Europe, told FT's 'Future of the Car' summit that the Hong Kong-listed company is in talks with the German carmaker to see if "there is any possibility we can find a location here in Europe."

Volkswagen owns a stake in Xpeng, and has three joint venture partners in China - SAIC, FAW and JAC, none of whom currently have production capacity in Europe.

Xpeng would also consider building a new European plant, FT reported. "We think not all the factories can satisfy the requirements of our latest or future product requirements," Cheng told FT, adding that Volkswagen's plants were "a little bit old"

Volkswagen declined to comment on the FT report, when contacted by Reuters.

Blume had previously said Volkswagen would check "if there are opportunities for our Chinese partners in Europe" to deal with excess plant capacity.

To counter domestic weakness, Xpeng is expanding aggressively overseas. However, its push into Europe faces challenges due to tighter rules on foreign investment.

(Reporting by Abu Sultan in Bengaluru, additional reporting by Mrinmay Dey in Mexico City; Editing by Shailesh Kuber)