XPeng begins localized EV production in Europe with plans to expand
Six months after announcing plans to begin EV production in Europe with the help of contract manufacturer Magna Steyr, XPeng Motors has begun rolling two initial all-electric models off those assembly lines overseas. The Chinese automaker continues to deepen its presence in the EU to gain a larger market share.
While XPeng Motors remains one of the more popular Chinese BEV brands in its native country, the company has continued to expand to new markets over the last half-decade or so. We’ve extensively covered XPeng’s expansion into Europe, where it now sells its EVs in 12 different countries in the region, including the Netherlands where we have test driven several of its models.
As you may recall, the EU implemented a probe into the Chinese automakers that the European Commission believes had been “unfairly” subsidized as exports into the region by the boatload. To combat this alleged advantage, Europe imposed tariffs on imports of EVs built in China, including marques like NIO, BYD, and XPeng.
That has not deterred Chinese automakers, who continue to import from China by the boatload while setting up local production to alleviate some of those duties. In May 2024, we reported that Magna Steyr’s president confirmed nearly every Chinese EV automaker, including XPeng Motors, had been in touch with the contract manufacturer about localized EV production in Europe.
This past March, the Austrian production arm of Magna International confirmed it was finalizing two EV assembly contracts with two Chinese brands – XPeng and GAC Group, which could begin as early as June. Today, six months after those reports arose, XPeng has confirmed EV production is underway in Europe at Magna Steyr.
XPeng begins assembling two EVs in Europe via Magna
In a Weibo post earlier today, XPeng confirmed the start of EV production in Europe, confirming that its G6 and G9 models have begun rolling off Magna Steyr’s assembly lines in Graz, Austria.
As you may recall, Magna Steyr was once home to production of the short-lived Fisker Ocean SUV and the Jaguar I-Pace, which has also been discontinued (although Jaguar isn’t bankrupt like Fisker). That left plenty of production space for Magna to fill, hence why so many Chinese automakers inquired.
This is a win-win for both Magna and XPeng. The former finds a potential long-term contract partner (more on that in a second). At the same time, the latter finally establishes localized EV production in Europe, avoiding most of the tariffs imposed by the EU.
The initial report out of Austria in March stated that both XPeng and GAC were planning to utilize a Semi-Knocked-Down (SKD) build process, in which pre-fabricated components are imported from China into Austria before being assembled locally at Magna Steyr.
The report also stated that the Chinese Automakers were initially only investing a minimal amount of funds into a small number of EV assemblies in order to test markets in Europe. Given XPeng’s growing presence overseas and today’s Weibo post, it has found a viable EV production solution in Magna and is already preparing for further expansions to secure more of Europe’s automotive market. Per the post (translated from Chinese):
In Q3 2025, Xpeng Motors officially launched its first localized production project in Europe at the Magna plant in Graz, Austria, with the first batch of the Xpeng G6 and G9 vehicles rolling off the production line. The plant will also produce more Xpeng models in the future. Xpeng Motors is deepening its presence in the European market with a richer product offering, continuing to accelerate its globalization journey with ‘Made in China’ technology.
There is no word yet on what other XPeng EVs may eventually be assembled in Europe, but I could see the new P7 making its way to Austria next. We will see!
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A worker repairs a power line in Austin, Texas, U.S., on Wednesday, Feb. 18, 2021.
Thomas Ryan Allison | Bloomberg | Getty Images
The rapid expansion of data centers in Texas is driving electricity demand higher during the winter, compounding the risk of supply shortfalls that could lead to blackouts during freezing temperatures.
The Lone Star state is attracting a huge amount of data center requests, driven by its abundant renewable energy and natural gas resources as well as its business friendly environment. OpenAI, for example, is developing its flagship Stargate campus in Abilene, about 150 miles west of Dallas-Forth Worth. The campus could require up to 1.2 gigawatts of power, the equivalent of a large nuclear plant.
The North American Electric Relibaility Corporation warned this week that data centers’ round-the-clock energy consumption will make it more difficult to sustain sufficient electricity supply under extreme demand conditions during freezing temperatures like catastropic Winter Storm Uri in 2021.
“Strong load growth from new data centers and other large industrial end users is driving higher winter electricity demand forecasts and contributing to continued risk of supply shortfalls,” NERC said of Texas in an analysis published Tuesday. Texas faces elevated risk during extreme winter weather, but the state’s grid is reliable during normal peak demand, NERC said.
During Uri, demand spiked for home heating in response to the freezing temperatures at the same time power plants failed in large numbers due to the same weather. Texas grid operator ERCOT ordered 20 gigawatts of rolling blackouts to prevent the system from collapsing, according to a Federal Energy Regulatory Commission report. The majority of the power plants went offline ran on natural gas.
It was the “largest manually controlled load shedding event in U.S. history” resulting 4.5 million people losing power for several days. At least 210 people died during the storm. Most of the fatalities were connected to the outages and included cases of hypothermia, carbon monoxide poisoning, and medical conditions exacerbated by freezing termperatures, according to FERC.
Data center requests surge
In the years since Uri, Texas has received a staggering amount of requests from data centers, crypto mining facilities and industrial customers seeking a grid conenction. More than 220 gigawatts of projects have requested connection as of this month, a 170% increase over the 83 gigawatts of project requests back in January, according to data published Wednesday by ERCOT.
About 73% of the projects requesting connection are data centers, according to ERCOT.
If all of those projects were actually built, they would be equivalent to the average annual power consumption of nearly 154 million homes in Texas, according to a CNBC analysis based on 2024 household electricity data. But the Lone Star state only has a population of about 30 million people.
Beth Garza, a former head of ERCOT’s watchdog, said she is very skeptical these projects will all get built, describing the scale of the numbers as “crazy big.” More than half the projects have not submitted planning studies, according to ERCOT.
“There’s not enough stuff to serve that much load on the equipment side or the consumption side,” said Garza, who served as director of ERCOT’s Independent Market Monitor from 2014 through 2019. “There’s just so much stuff in the world to make those kinds of numbers work.”
Phantom data centers are showing up in grid connection requests across the U.S. as developers shop the same projects around to mutliple jurisdictions, said John Moura, the director of NERC’s reliability assessments. This makes it difficult for utilities to forecast future demand conditions.
Reliability at risk
The projects that ERCOT has approved to actually connect to the grid is much smaller at 7.5 gigawatts, but this is still a subsantial amount of new demand. By comparison, the six county region in southeastern Pennsylvania that includes Philadelphia, with a population of 1.7 million people, had a peak demand of about 8.6 gigwatts in 2024, according to the state utility board.
Texas’ supply and demand balance can become tight during winter and potentially fall into deficit. The state has 92.6 gigawatts of available resources and peak demand in an extreme Uri-like scenario could reach about 85.3 gigawatts, according to NERC.
But avalaible power could fall to around 69.7 gigawatts in extreme winter weather, leaving a supply deficit of more than 15 gigawatts. This is due to typical power plant maintainence and forced plant outages as well as reductions in power capacity due to winter conditions.
“What’s important to understand is the tightness we’re seeing,” Moura said. NERC’s winter assessment only included data center facilities that have reached certain milestones to filter out speculative projects, he said.
“I can’t stress enough how much of a monumental change this is for the electric industry,” Moura said of the data center requests. One solution is for data centers to show flexibility in their electricity consumption to help keep demand and supply in balance during extreme winter scenarios, he said.
In the case of Uri, natural gas plants made up 58% of all the unplanned outages in Texas, according to FERC. Freezing tempartures reduced gas production, led to challenges delivering fuel and problems transmitting electricity as power lines fell.
Texas has adopted rules to harden natural gas infrastructure for extreme winters in the wake of the storm.
When gas plants go out in such a large way, solar and battery storage also face challenges, according to NERC. Peak demand in winter is in the early morning hours when sunlight is lower and batteries may not have had enough time recharge, Moura said.
With data centers running around the clock, “maintaining sufficient battery state of charge will become increasingly challenging for extended periods of high loads, such as a severe multi-day storm like Winter Storm Uri,” NERC said in its analysis.
“Power shortfalls and rolling outages really could happen in the next few years in certain regions” of the U.S. as demand from facilities like data centers outstrips supply, said Rob Gramlich, president of power consulting firm Grid Strategies. “Those are unacceptable to everybody in the United States.”
Garza said she’s confident that the reliable demand from data centers will bring new supply. “Plants love that kind of of opportunity,” she said. “My expectation is that then attracts additional private capital investment to meet those supply needs.”
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First Solar just cut the ribbon on a huge new factory in Iberia Parish, Louisiana, and it dwarfs the New Orleans Superdome. The company’s $1.1 billion, fully vertically integrated facility spans 2.4 million square feet, or about 11 times the size of the stadium’s main arena.
The factory began production quietly in July, a few months ahead of schedule, and employs more than 700 people. First Solar expects that number to hit 826 by the end of the year. Once it’s fully online, the site will add 3.5 GW of annual manufacturing capacity. That brings the company’s total US footprint to 14 GW in 2026 and 17.7 GW in 2027, when its newly announced South Carolina plant is anticipated to come online.
The Louisiana plant produces First Solar’s Series 7 modules using US-made materials — glass from Illinois and Ohio, and steel from Mississippi, which is fabricated into backrails in Louisiana.
The new factory leans heavily on AI, from computer vision that spots defects on the line to deep learning tools that help technicians make real‑time adjustments.
Louisiana Governor Jeff Landry says the investment is already a win for the region, bringing in “hundreds of good-paying jobs and new opportunities for Louisiana workers and businesses.” A new economic impact analysis from the University of Louisiana at Lafayette projects that the factory will boost Iberia Parish’s GDP by 4.4% in its first full year at capacity. The average manufacturing compensation package comes in at around $90,000, more than triple the parish’s per capita income.
First Solar CEO Mark Widmar framed the new facility as a major step for US clean energy manufacturing: “By competitively producing energy technology in America with American materials, while creating American jobs, we’re demonstrating that US reindustrialization isn’t just a thesis, it’s an operating reality.”
This site joins what’s already the largest solar manufacturing and R&D footprint in the Western Hemisphere: three factories in Ohio, one in Alabama, and R&D centers in Ohio and California. Just last week, First Solar announced a new production line in Gaffney, South Carolina, to onshore more Series 6 module work. By the end of 2026, the company expects to directly employ more than 5,500 people across the US.
Read more: First Solar pours $330M into a new South Carolina solar factory
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