Tesla’s Chinese competitors Xpeng and BYD are revving their engines

28 Aug 2023

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Xpeng is set to buy ride-hailing company Didi’s smart EV assets to launch a new brand while BYD makes a play for US-based Jabil.

Tesla’s Chinese competitor Xpeng is acquiring the smart EV assets of ride-hailing giant Didi for around $744m to launch a new mass-market brand.

Announced today (28 August), the deal will see Didi and Xpeng collaborate to promote the “global application of smart EVs and technologies”. As part of the deal, Xpeng aims to launch an A-class smart EV model in 2024 under the project name Mona.

The new model and brand, derived from certain business assets related to Didi’s smart EV development project, will be different from the main Xpeng brand.

He Xiaopeng, CEO and chair of Xpeng, said that the new A-class smart EV products under the new brand will significantly increase the company’s scale and accelerate its adoption of smart EVs in the mass market segment, “bringing our technologies to a much broader customer base”.

The news comes a month after Volkswagen’s $700m investment in Xpeng was announced, which will see the production of two new models under the Volkswagen brand utilising Xpeng tech.

Didi is a popular Chinese ride hailing app that went public on a New York Stock Exchange two years ago, and faced a crackdown from Chinese regulators soon after. The service has 587m annual active users as of Q1 2023.

Headquartered in Beijing, Didi’s services have included taxi hailing, private car hailing, social ride sharing, bike sharing and even on-demand delivery services. The company has previously received significant investments from Toyota.

As part of the latest deal with Xpeng, Didi will also collaborate with the EV maker in marketing, financial insurance services, charging and even an international expansion. Didi has been working with Chinese carmakers to develop robotaxis which it aims to put in service by 2025.

Meanwhile, Chinese carmaker BYD, another Tesla competitor, has agreed to buy US firm Jabil’s mobility business for $2.2bn. According to Reuters, the deal will expand BYD’s customer base and product portfolio as it looks to capture Jabil’s potential growth in the sector.

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Vish Gain is a journalist with Silicon Republic