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XPeng Inc. (NYSE: NYSE:) and Volkswagen (ETR:) Group (OTC: VWAGY) have announced a new phase in their partnership with the signing of a Master Agreement focused on platform and software strategic technical collaboration.
This agreement, which follows previous announcements on July 26 and December 6, 2023, signals a significant step in the joint development of B-class battery electric vehicles (BEVs) and sets the stage for a more extensive and deeper strategic collaboration in the future.
Under the terms of the Master Agreement, XPeng and Volkswagen have also initiated a Joint Sourcing Program to procure common vehicle parts and platform components. This collaboration is expected to leverage Volkswagen’s global supply chain expertise and scale to reduce costs and enhance the competitiveness of the B-class BEVs being developed together.
Mr. Xiaopeng He, Chairman and CEO of XPeng, remarked on the milestone, emphasizing the unique nature of the strategic partnership with Volkswagen and the success achieved through mutual commitment and trust. He noted the potential for further synergies and the goal of delivering top-tier smart EV products to the Chinese market.
Ralf Brandstätter, a Board Member of Volkswagen AG (OTC:) for China, highlighted the importance of speed in China’s rapidly evolving EV market and the company’s strategy to expand development capacities locally. The partnership with XPeng is expected to accelerate development times, improve efficiency, and optimize cost structures, enhancing Volkswagen’s competitive edge in a price-sensitive market.
Brandstätter also pointed out the swift finalization of the Master Agreement as evidence of the collaboration’s potential. Both companies are working closely to leverage their combined strengths and bring innovative smart products to customers.
This strategic partnership represents a notable collaboration in the automotive industry, with both companies aiming to capitalize on the growing EV market in China. The information is based on a recent SEC filing by XPeng Inc.
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