The Kaipher Editorial Team 
Chinese EV maker Xpeng has begun local manufacturing of its first electric SUVs in Europe through a partnership with Magna Steyr at its Graz, Austria, plant. The first batch of G6 and G9 models rolled off the assembly line on September 15, marking the first time a Chinese OEM has utilized Magna’s European production capabilities to serve the continent (CNEVPost).
Strategic Response to EU Tariffs
The launch coincides with the European Union’s imposition of additional anti-subsidy tariffs on Chinese-made EVs—ranging from 7.8% to 35.3%—with Xpeng facing an extra 20.7% duty on top of the standard 10% import tax (ING Think).
By adopting a semi-knocked-down (SKD) assembly approach—shipping partially assembled kits from China and completing them in Graz—Xpeng avoids these punitive duties while positioning itself as a local manufacturer.
Production Partnership Details
Magna Steyr’s Graz facility, with an annual capacity of about 200,000 vehicles, has a storied history of producing premium models for Mercedes-Benz, BMW, Jaguar Land Rover, and Toyota—including the Mercedes G-Class for over 40 years.
Recent contract terminations—including the BMW Z4 and Toyota GR Supra—left capacity underutilized, making the Xpeng partnership a crucial new source of volume and job security for the plant (Electrive).
Market Performance and Expansion Plans
Xpeng’s overseas deliveries reached 18,701 units in the first seven months of 2025—a 217% year-over-year increase—and it registered over 8,000 vehicles in Europe by mid-year, with the G6 accounting for 67% of European sales (CNEVPost).
Since entering Norway in 2021, Xpeng now operates in 46 countries, and it recently opened an R&D center in Munich under “In Europe, With Europe” to tailor products for local markets. Future plans at Graz include adding electric sedans, mid-size SUVs, hybrids, and the upcoming P7+ AI-equipped sedan for European customers.
