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Volkswagen Partners with Xpeng for EV Development in China

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Volkswagen, the renowned automobile manufacturer, has recently announced its plans to acquire a 5% stake in Xpeng, a prominent Chinese electric vehicle (EV) maker. This partnership aims to foster collaboration between the two companies in developing two B-class battery EVs specifically tailored for the Chinese market.

Under the agreement, Xpeng will issue Class A ordinary shares that will equate to approximately 4.99% of the company’s outstanding share capital. These shares will be sold to Volkswagen at a price of $15 per American depositary share, amounting to a significant investment of around $700 million.

The joint effort will see the creation of new battery EVs that will proudly bear the Volkswagen brand for sale exclusively within China. Production of these models is anticipated to commence in 2026, offering Chinese consumers innovative and sustainable mobility solutions.

This partnership does not end here, as both companies intend to explore further opportunities for collaboration moving forward. By joining forces, Volkswagen and Xpeng aim to leverage each other’s expertise and drive advancements in the rapidly evolving EV industry.

As a result of this exciting announcement, Xpeng’s New York-listed ADSs experienced an impressive surge of 17.5% in morning trading, reaching $18.05.

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