Xpeng “Backdoor Listing” With Magna! Local Production in Europe Begins, Domestic Supply Chain Going Global May Be Key to Future Success

Specialized Plastic VisionOn September 16, it was observed that XPeng Motors officially commenced localized production in Europe at the Magna Steyr factory in Graz, Austria, with the first batch of G6 and G9 SUV models successfully rolling off the production line.

This collaboration marks the first time a Chinese car company has utilized the resources of a top global contract manufacturer to achieve large-scale overseas production. The Magna Graz plant, as a benchmark for automotive manufacturing in Europe, boasts a century-long history of high-end manufacturing and has previously manufactured for Mercedes-Benz.G-Class, BMW Z4, Jaguar I-PACE and other classic models provide OEM services, with flexible production lines capable of producing multiple models on the same line, achieving an annual production capacity of 200,000 units.

Source: XPeng

"Using Magna as a 'shell' to actually avoid tariffs"

In 2024, the European Union imposed a countervailing duty of up to 36.3% on Chinese electric vehicles, directly leading to a sharp increase in the export costs of complete vehicles.Xpeng's decision to partner with Magna is primarily aimed at quickly overcoming trade barriers in the European Union.By producing locally, XPeng still needs to pay20.7% of the outsourcing cost, but the overall cost is still 15%-20% lower than the complete vehicle import model.

Currently, the European market coverage of XPeng has been established.Sales overseas in 46 countries and regions reached 18,701 vehicles in the first seven months of 2025, a year-on-year increase of 217%. The European market contributed more than 8,000 vehicles, with the G6 model accounting for 67%, becoming the absolute main force. Notably, Xpeng's Munich R&D center in Germany has been put into operation simultaneously. This center focuses on the localization and adaptation of intelligent driving technology and supports Magna's factory in achieving flexible production of multiple models. In the future, it will expand to include more categories such as sedans and high-performance electric vehicles.

The temporary tariff policy effective from July 5, 2024, shows that Chinese automakers such as BYD, Geely, and SAIC face a gradient tax rate of 17.0% to 36.3%, while overseas collaborative production can effectively circumvent this tax burden.The EU's anti-subsidy tax policy has become a core catalyst for Xiaopeng's localized production.Magna factory'sThe "shared production line" model allows XPeng to achieve economical production in the medium output range, avoiding the high fixed costs of building its own factories. This move contrasts sharply with the intense competition in the domestic market—by 2025, the price war in China's new energy vehicle market is expected to continue escalating, with the prices of some models dropping by 30% compared to 2023, forcing car companies to seek additional markets overseas.

Chinese car manufacturers are continuously innovating their overseas expansion models.

Currently, the Xiaopeng case reflects the overall strategic upgrade of Chinese car companies going abroad. Traditional automakers like Chery are continuously...For 22 consecutive years, it has been the export champion, with 444,000 vehicles exported in the first five months of 2025. BYD, through a "fleet + factory" dual-line layout, has established factories in Brazil, Hungary, Turkey, and other locations, surpassing 470,000 overseas sales in the first half of 2025. Emerging car companies are increasingly emphasizing technology export characteristics—Leapmotor formed a joint venture with Stellantis to establish Leapmotor International, rapidly covering nine European countries; NIO sticks to a high-end positioning, expanding its market in countries like Portugal and Greece through a national general agent model.

Source of the image: XPeng

Mode innovation is concentrated in three dimensions: first, overseas factory establishment to achieve."Localization of production," such as BYD's Hungarian plant, which is set to start production in 2025 with a designed annual capacity of 150,000 vehicles; secondly, technical cooperation to achieve "localization of R&D," with XPeng's Munich R&D Center already working on L2-level intelligent driving function adaptation; thirdly, supply chain collaboration to achieve "localization of the ecosystem," with CATL building supporting battery bases in Germany and Hungary, forming a complete ecosystem of "battery-vehicle-charging network." This shift from "product export" to "capacity output + ecosystem construction" has resulted in the net promoter score (NPS) of Chinese car companies in overseas markets reaching 81%, surpassing several traditional luxury brands.

Supply Chain Integration and the Reshaping of Global Competitiveness

The globalization of supply chains will give rise to three major transformative trends: firstly, the emergence of circular supply chain models, such asH&M's recycling program achieves the use of regenerated fibers in clothing; secondly, the digitalization of supply chains is becoming widespread, with Amazon using AI algorithms to increase order processing efficiency by 40%; thirdly, flexible supply chains have become the standard, with Toyota reducing supply chain disruption risk by 30% through a multi-supplier system. For the automotive industry, localized production of general components such as plastic products and electronic components will become a key breakthrough.

For example, in the case of XPeng, its European factory plans to introduce more local suppliers in the future. "China R&D + Europe Manufacturing + Global Sales" closed loopAccording to a report by the Rhodium Group, in 2024, overseas investment in China's new energy vehicle industry chain reached $16 billion, surpassing domestic investment for the first time, with the battery sector accounting for 74%. This reversal in capital allocation marks the transformation of Chinese car companies from "technology adopters" to "standard setters"—at the Munich Motor Show, technologies such as smart cockpits and lidar exhibited by Chinese car companies have become important references for European car companies.

Image source: XPeng

XPeng's current European factory still relies on importing components from China, but with supporting companies like CATL's German factory and SVOLT Energy's German base expanding overseas, local supply of core components such as batteries can be realized in the future. Taking CATL's Thuringia factory in Germany as an example, its localized production reduces procurement costs for European customers.Reducing the delivery cycle to 7 days by 20%. This "R&D in China, local production, and globalized supply chain" network structure is expected to optimize the overall cost for Chinese OEMs by 10%-15%.

Epilogue:

The launch of Peng Motors' production in Europe marks the beginning of the globalization of Chinese car manufacturers.The strategic upgrade from "trade expansion" to "ecosystem expansion" overseas. Driven by both tariff avoidance and cost optimization, achieving localized production by combining global top-tier supplier resources may become the new norm in the industry.

With the deepening integration of the supply chain, Chinese electric vehicles are expected to maintain their technological lead while achieving further cost advantages through global resource allocation. According to the China Passenger Car Association's forecast,In 2025, China's exports of new energy vehicles are expected to exceed 2 million units, with a global market share expected to reach 25%, ultimately building a more solid moat in international market competition.

This kind of fromThe transformation from "Made in China" to "Intelligent Manufacturing in China" will not only reshape the global automotive industry landscape but also provide critical support for the global green and low-carbon transition.