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[BUSINESS] · China, Germany, United States · 42 sources

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Volkswagen considers using Xpeng-developed architecture in Europe

Volkswagen is considering a major strategic shift by potentially introducing the China Electronic Architecture (CEA), developed in partnership with Xpeng, to its European market. The proposal, expected to be presented to group management by Volkswagen brand chief Thomas Schäfer, could underpin approximately 75% of next-generation models for the Volkswagen, Škoda, and Cupra brands.

Adopting the CEA could provide significant cost advantages, with estimates suggesting savings between €4 billion and €5 billion in development costs. This move would contrast with the company's current dual-track software strategy, which utilizes the Xpeng-partnered architecture in China while investing approximately $5.8 billion in a joint venture with the American company Rivian to develop software for Western markets.

If implemented, the shift could diminish the role of the Rivian partnership in Volkswagen's global technology roadmap. The decision follows ongoing software development challenges faced by Volkswagen's internal subsidiary, Cariad, which reported an operating loss of 2.4 billion euros in 2024.

Separately, Volkswagen Anhui has launched the ID. Unyx 09 in China. This electric sedan, the second model resulting from the Volkswagen-Xpeng collaboration, features a maximum range of 755 km according to the CLTC standard and utilizes Xpeng's Turing chip and VLA driver assistance system.

Entities

CARIAD · Cupra · Rivian · Thomas Schäfer · Volkswagen · Volkswagen Group · XPeng · Škoda

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