Robert Way/iStock Editorial via Getty Images
XPeng (NYSE: XPEV) is considering setting up a manufacturing base in Europe, joining other Chinese electric vehicle makers that are localizing production in the region to mitigate the impact of import tariffs, Bloomberg reported.
XPeng (XPEV) is in the early stages of selecting sites in the European Union and plans to build production capacity in areas with “relatively low labor risks,” CEO He Xiaopeng told Bloomberg. The company also plans to set up large data centers in Europe to support its intelligent driving features.
He said XPeng's (XPEV) international expansion plans would not be affected by the tariff hike, but “profits from European countries will decline somewhat after the tariff hike.”
XPeng, which has a partnership with Volkswagen (OTCPK:VWAGY), joins other Chinese EV makers such as BYD (OTCPK:BYDDF), Chery Automobile and Geely Automobile's (OTCPK:GELYF) Zeekr in planning to tackle EU import tariffs.
Last week, XPeng (XPEV) reported a narrower second-quarter loss and higher revenue, but gave a weaker-than-expected third-quarter delivery outlook.
XPeng (XPEV) shares have fallen by nearly half so far this year. Seeking Alpha's Quant rates the stock a Hold, but sell-side analysts are more bullish.
