XPeng begins localized EV production in Europe with plans to expand

Six months after announcing plans to begin EV production in Europe with the help of contract manufacturer Magna Steyr, XPeng Motors has begun rolling two initial all-electric models off those assembly lines overseas. The Chinese automaker continues to deepen its presence in the EU to gain a larger market share.

While XPeng Motors remains one of the more popular Chinese BEV brands in its native country, the company has continued to expand to new markets over the last half-decade or so. We’ve extensively covered XPeng’s expansion into Europe, where it now sells its EVs in 12 different countries in the region, including the Netherlands where we have test driven several of its models.

As you may recall, the EU implemented a probe into the Chinese automakers that the European Commission believes had been “unfairly” subsidized as exports into the region by the boatload. To combat this alleged advantage, Europe imposed tariffs on imports of EVs built in China, including marques like NIO, BYD, and XPeng.

That has not deterred Chinese automakers, who continue to import from China by the boatload while setting up local production to alleviate some of those duties. In May 2024, we reported that Magna Steyr’s president confirmed nearly every Chinese EV automaker, including XPeng Motors, had been in touch with the contract manufacturer about localized EV production in Europe.

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This past March, the Austrian production arm of Magna International confirmed it was finalizing two EV assembly contracts with two Chinese brands – XPeng and GAC Group, which could begin as early as June. Today, six months after those reports arose, XPeng has confirmed EV production is underway in Europe at Magna Steyr.

In a Weibo post earlier today, XPeng confirmed the start of EV production in Europe, confirming that its G6 and G9 models have begun rolling off Magna Steyr’s assembly lines in Graz, Austria.

As you may recall, Magna Steyr was once home to production of the short-lived Fisker Ocean SUV and the Jaguar I-Pace, which has also been discontinued (although Jaguar isn’t bankrupt like Fisker). That left plenty of production space for Magna to fill, hence why so many Chinese automakers inquired.

This is a win-win for both Magna and XPeng. The former finds a potential long-term contract partner (more on that in a second). At the same time, the latter finally establishes localized EV production in Europe, avoiding most of the tariffs imposed by the EU.

The initial report out of Austria in March stated that both XPeng and GAC were planning to utilize a Semi-Knocked-Down (SKD) build process, in which pre-fabricated components are imported from China into Austria before being assembled locally at Magna Steyr.

The report also stated that the Chinese Automakers were initially only investing a minimal amount of funds into a small number of EV assemblies in order to test markets in Europe. Given XPeng’s growing presence overseas and today’s Weibo post, it has found a viable EV production solution in Magna and is already preparing for further expansions to secure more of Europe’s automotive market. Per the post (translated from Chinese):

In Q3 2025, Xpeng Motors officially launched its first localized production project in Europe at the Magna plant in Graz, Austria, with the first batch of the Xpeng G6 and G9 vehicles rolling off the production line. The plant will also produce more Xpeng models in the future. Xpeng Motors is deepening its presence in the European market with a richer product offering, continuing to accelerate its globalization journey with ‘Made in China’ technology.

There is no word yet on what other XPeng EVs may eventually be assembled in Europe, but I could see the new P7 making its way to Austria next. We will see!