Shanghai Securities News China Securities Network (Reporter Yu Liyan) - Volkswagen Group, which has proposed the "In China, for China" strategy, is advancing its electric offensive in China. On February 29th, Xiaopeng Motors and Volkswagen Group jointly announced that they had signed a joint development agreement for platform and software strategic technology cooperation, marking a milestone in their strategic cooperation. The two sides will accelerate the joint research and development of two B-class pure electric vehicles.
In December 2023, Volkswagen Group completed the acquisition of 4.99% of the total issued and outstanding share capital of Xiaopeng Motors. The technology cooperation agreement signed this time focuses on two Volkswagen brand mid size cars jointly developed by both parties in the early stage of cooperation, with the first product being an SUV model. Through this collaboration, the Volkswagen brand will rapidly and targetedly expand its existing product portfolio, thereby better meeting the needs of new customer groups in the rapidly growing Chinese electric vehicle market. The two electric vehicle models jointly developed by both parties will be equipped with advanced software and hardware, providing Chinese customers with an intuitive and interconnected digital experience and advanced autonomous driving functions. Both sides will fully leverage their core strengths and jointly promote research and development.
According to the agreement, both parties will purchase shared automotive and platform components through a joint procurement plan. With this plan and the strong supply chain system of Volkswagen Group, this plan aims to create cost advantages and make the medium-sized intelligent connected vehicle models jointly developed by both parties more economically competitive. Through joint procurement and the application of innovative technologies in vehicle design and engineering, the product development cycle will be shortened by more than 30%. Volkswagen (China) Technology Co., Ltd. (VCTC) located in Hefei is the docking hub for this cooperation, ensuring the best synergy.
"China is the largest and fastest-growing electric vehicle market in the world. To explore highly promising sub markets and gain leading advantages, speed is crucial. We firmly implement the 'In China, for China' strategy, with the aim of meeting the unique needs of Chinese customers, continuously expanding our local product portfolio, and continuously improving our research and development capabilities," said Bered, Managing Director of Volkswagen Group's business in China. Through cooperation with Xiaopeng Motors, we will shorten the product development cycle, improve efficiency, and optimize the cost structure. In a highly price sensitive market environment, this will significantly enhance the product's economic competitiveness
Berry added, "After announcing the strategic partnership last year, the two sides quickly completed the signing of this technology cooperation agreement, demonstrating the tremendous potential of this cooperation. Currently, the two teams are working at full speed towards a common goal and will fully leverage their advantages to create smart car products for customers."
Xiaopeng Motors Chairman and CEO He Xiaopeng said, "The signing of the joint development agreement marks another major milestone in our strategic cooperation with Volkswagen Group.". The strategic cooperation model between Volkswagen Group and Xiaopeng Motors has no precedent in the automotive industry. The deep consensus on strategic cooperation between the two sides and the strong trust bond created between their R&D teams over the past eight months have laid a solid foundation for the smooth launch of the project. Gathering Volkswagen Group's globally renowned vehicle research and engineering capabilities, as well as Xiaopeng Automobile's leading intelligent electric vehicle technology in the industry, we will strive to create the ultimate intelligent electric vehicle products for Chinese consumers. Based on a long-term perspective of strategic cooperation, both parties have invested their core strengths and resources into strategic cooperation. Through the joint procurement plan, synergies have begun to be realized. I firmly believe that the strategic partnership between Xiaopeng Motors and Volkswagen Group holds broad prospects, and both sides will further explore together
Meng Xia, CEO of Volkswagen's passenger car brand in China, said, "The Volkswagen brand is continuously expanding its product portfolio of electric vehicle models to meet the needs of Chinese customers.". The cooperation with Xiaopeng Motors will inject more momentum into our development, and both parties will fully leverage their respective advantages to quickly and efficiently create two models specifically developed for the Chinese market based on our existing product portfolio, with the first model being an SUV. In the fiercely competitive market environment, this cooperation is of great significance, and I sincerely appreciate the efforts of both teams. Both models will be launched in 2026. The Volkswagen brand plan is clear and will further explore the promising and steadily growing mid size car segment market. The progress made by both parties is an important milestone in implementing our 'In China, for China' strategy, demonstrating Volkswagen's firm commitment to Chinese customers