• The jointly developed technology architecture will not only be integrated into Volkswagen's BEV platform, but also deployed on its gasoline and plug-in hybrid platforms in China.
• The expanded technical cooperation will significantly increase the scale of models equipped with their joint E/E architecture in the Chinese market.

Xpeng (NYSE: XPEV) and Volkswagen Group have signed a new agreement to expand their partnership into broader areas.

The Chinese electric vehicle (EV) maker announced today that the two have signed an agreement to expand their technical cooperation, and the jointly developed technology architecture will not only be integrated into Volkswagen's BEV platform, but also deployed on its gasoline and plug-in hybrid platforms in China.

This will significantly expand the strategic technical cooperation between the two parties to broader markets, further accelerating the implementation of Volkswagen's software-defined car strategy and enhancing its global competitiveness, Xpeng said in a statement.

The cross-platform and cross-powertrain platformization of the E/E Architecture will enable Volkswagen to achieve faster software iteration and over-the-air (OTA) updates, significantly shortening vehicle development cycles, the company said.

The joint R&D team has designed and validated the E/E architecture developed for electric vehicle platforms, which is also applicable to ICE and PHEV platforms, according to the statement.

The expansion of the technical cooperation will significantly increase the scale of models equipped with the E/E architecture in the Chinese market, enabling Volkswagen to achieve significant platform-driven economies of scale, Xpeng said.

"We do not confine technological excellence to a single powertrain type. Our brands are committed to delivering the most advanced solutions for customers in every segment," said Ralf Brandstätter, CEO of Volkswagen Group China and Member of the Board of Management of Volkswagen AG for China.

Volkswagen is systematically reducing its cost base, enabling the company to continue offering customers attractive options in the highly competitive Chinese automotive market, Brandstätter said.

On July 26, 2023, Volkswagen announced a $700 million investment in Xpeng to jointly develop two B-segment BEVs for sale in the Chinese market under the Volkswagen brand, with production expected to begin in 2026.

Since then, the two companies have signed several new agreements, including a joint procurement plan and the expansion of their cooperation to Volkswagen's global MEB platform.

In January this year, Xpeng announced that it would collaborate with Volkswagen to build one of China's largest supercharging networks.