Volkswagen and XPeng Expand Software Cooperation in China, Enhancing Vehicle Safety and Performance.

Volkswagen and XPeng expand software cooperation in China, with Volkswagen set to introduce the China Electronic Architecture (CEA) to all combustion engines and plug-in hybrid models produced in China starting in 2027. The CEA enables advanced driving assistance systems, a smart cockpit, and seamless over-the-air updates. This cooperation marks a milestone in Volkswagen's "In China, For China" strategy, with the group aiming to offer approximately 30 pure electric models in the Chinese market by 2030.

Volkswagen and XPeng have expanded their strategic cooperation in China, with Volkswagen set to introduce the China Electronic Architecture (CEA) to all combustion engine and plug-in hybrid models produced in China starting in 2027. The CEA enables advanced driving assistance systems, a smart cockpit, and seamless over-the-air updates. This cooperation marks a milestone in Volkswagen's "In China, For China" strategy, with the group aiming to offer approximately 30 pure electric models in the Chinese market by 2030.

The expanded agreement, signed on August 15, 2025, builds on the initial collaboration signed in July 2024. The CEA was originally planned for Volkswagen's battery electric vehicle (BEV) platforms in China but will now be extended to include internal combustion engine (ICE) and plug-in hybrid (PHEV) models. This cross-platform and cross-powertrain platformization will enable faster software iteration, over-the-air updates, and reduced development cycles for new models [1].

Volkswagen's CEO, Ralf Brandstätter, stated, "This is about breaking the boundaries of powertrain types. Extending the CEA to ICE models strengthens our technological edge in the traditional power sector, boosts our competitiveness in China, and frees up resources for investing in future innovations" [1].

The partnership traces back to July 2023, when Volkswagen announced a $700 million investment in XPeng and the joint development of two B-segment EVs slated for mass production in 2026. Since then, the companies have signed several new agreements, including a joint procurement plan and the expansion of their cooperation to Volkswagen's global MEB platform [3].

XPeng's CEO, He Xiaopeng, commented, "This Expanded Technical Collaboration not only underscores the mutual trust in our long-term strategic partnership but also highlights our commitment to and vision for continuous innovation in smart electric vehicle technologies" [2].

The expanded technical cooperation is expected to help Volkswagen accelerate its software-defined vehicle strategy and boost global competitiveness. The cross-platform and cross-powertrain platformization of the E/E Architecture will enable Volkswagen to achieve faster software iteration and over-the-air (OTA) updates, significantly shortening vehicle development cycles [3].

References:
[1] https://chinaevhome.com/2025/08/15/xpeng-and-vw-expand-strategic-agreement-to-extend-cea-to-ice-and-phev-models/
[2] https://www.electrive.com/2025/08/15/vw-and-xpeng-expand-cooperation-once-again-now-into-ice-territory/
[3] https://cnevpost.com/2025/08/15/xpeng-vw-expand-tech-partnership-gas-hybrid-platforms/