Volkswagen buys stake in Xpeng, will jointly develop two new EVs with the Chinese automaker

Volkswagen said connected Wednesday that it has signed a woody to jointly make 2 caller electrical vehicles for China with Chinese EV shaper Xpeng. As portion of the deal, Volkswagen volition put astir $700 cardinal successful Xpeng, taking a 4.99% stake.

Xpeng's U.S.-traded shares were up implicit 40% connected Wednesday greeting pursuing the news.

Under the deal, Volkswagen and Xpeng volition make 2 midsize battery-electric models based connected the level that underpins Xpeng's G9, a midsize electrical crossover SUV.

In a separate statement confirming the deal, Xpeng said that the 2 caller vehicles volition besides incorporated its precocious driver-assist software.

The caller EVs, which volition beryllium branded arsenic VWs and sold lone successful China, are expected to motorboat successful 2026.

Volkswagen is paying $15 per U.S.-traded stock for its Xpeng involvement and volition person a spot connected the EV maker's committee of directors, taxable to regulatory approvals.

Volkswagen besides confirmed that its Audi subsidiary has signed a abstracted woody with its longtime Chinese associated task partner, Shanghai-based SAIC Motor, to jointly make caller Audi-branded EVs for the Chinese market. The program is to make caller EVs successful segments wherever Audi does not presently person entries successful China, the institution said.

"We are leveraging the strengths of Volkswagen and our partners to make synergies to bring further products to marketplace faster," said Ralf Brandstätter, Volkswagen's China chief, successful a statement. "In doing so, we absorption connected the circumstantial needs of our customers successful China. At the aforesaid time, we privation to importantly optimize improvement and procurement costs."