EV stocks of China-based XPeng investing Inc. got a broad boost on Wednesday, bucking the weakness in the broader stock market, as investors cheered Volkswagen AG’s $700 million investment. Also providing support for the EV sector, a group of global automakers said they were working together to build a high-powered charging network that will be accessible to all EV owners. That also appeared to help the shares of Volkswagen EV stock and XPeng EV stock.
XPeng’s EV stocks led the charge higher, rocketing 26.9% in afternoon trading to put it on track for an 11-month closing high for the electric vehicle shares.
Volkswagen’s XPeng investment
The Volkswagen EV stock and the XPeng EV stocks rally comes after Volkswagen said it would take a 4.99% stake in XPeng. The Volkswagen’s XPeng investment comes with a cooperation pact between the VW brand and XPeng, which will provide for the development of two VW electric models customized for China’s EV market.
VW Group will eventually hold a 4.99 percent stake in the Chinese EV maker via a capital increase and is getting an observer board seat, VW said in a statement on Wednesday.
VW Group and XPeng will develop two VW brand battery powered models on the MEB platform at VW’s new technology center in Hefei, the automaker’s largest development location outside Wolfsburg. The midsize EVs will be rolled out in China starting in 2026.
XPeng is one of the smaller players in China’s EV space. Its sales dropped by 40 percent in the first half, but it is betting on its newly launched G6 crossover, priced 20 percent below Tesla’s Model Y and equipped with the company’s latest software, to boost growth.
Partnerships
VW Group also announced plans for further cooperation between its subsidiary Audi and SAIC Motor including jointly developed models and a new platform but fell short of providing details or a timeline.
Audi’s partnership with SAIC will cover premium EVs and start with models in a segment where the brand is not yet represented in China, the automaker said.
Both agreements are for future joint development of new local platforms for the next generation of intelligent, fully connected vehicles, VW Group said.
VW Group China chief Ralf Brandstaetter said the partnerships will significantly optimize development and procurement costs.
The G9 is XPeng’s most advanced electric car with an 800-volt electric architecture.
XPeng and VW deal
The deals, which bring VW Group’s count of automaker partnerships in China to four, mark a turning point for China’s manufacturers from learning from foreign partners to helping them with their own technology and designs.
VW is trying to turn the tide in China, where Tesla and local champion BYD have raced ahead because they are better at producing EVs with technology and software geared to local tastes.
The German company’s EV sales in China dipped in the first half in a market that grew 20 percent.
VW Group last month replaced the CEO of Audi partly because it wants to halt sliding sales in the country. The premium brand has faced delays in developing a new EV platform, hindering its ability to compete.
Other EV stocks update
Among XPeng’s China-based rivals, shares of Nio Inc. NIO shot up 9.6% toward a seven-month high, Li Auto Inc. LI shares climbed 3.2% toward a one-year high and BYD Co.’s BYDDY CN:002594 stock tacked on 2% toward an 11-month high.
Meanwhile, EV stocks of Texas-based Tesla Inc. TSLA, which generated 23% of its second-quarter revenue from China, were an outlier as they slipped 0.5%.
Among other U.S.-based EV companies, Rivian Automotive Inc. RIVN electric vehicle shares ran up 6.4% toward a seven-month high.
Meanwhile, Nikola Corp. NKLA electric vehicle shares leapt 9.4% after tumbling 19% over the past two days. Fisker Inc.’s FSR stock rose 2.6% after sinking 15% over the past four sessions and Lion Electric Co.’s LEV stock tacked on 1.7% after giving up 5.3% in the past two days.
The rallies come as the Nasdaq Composite Index COMP fell 0.4% and the S&P 500 SPX slipped 0.2%.
Joint venture
Separately, seven automakers BMW Group XE: BMW, General Motors Co. GM, Honda Motor Co. HMC JP: 7267, Hyundai Motor Co. KR: 005380, Kia Corp. KR: 000270, Mercedes-Benz Group AG XE: MBG and Stellantis NV STLA IT: STLAM are creating a joint venture to make EV charging more accessible.
The joint venture will develop a charging network with at least 30,000 chargers that will be accessible to all battery-powered vehicles, whether they use the North American Charging Standard (NACS), which is used by Tesla, or the Combined Charging Systems (CCS).
Charging companies electric vehicle shares
Among EV charging companies, shares of ChargePoint Holdings Inc. CHPT tacked on 0.9%, EVgo Inc. EVGO edged up 0.3% and Blink Charging Co. BLNK advanced 1.8%.
