Xpeng to launch budget EV brand in Europe by 2026

Chinese EV maker Xpeng plans to launch its mass-market Mona brand in Europe and other international markets in 2026, CEO He Xiaopeng told CNBC.

The Mona brand, introduced in China in 2024 with the Mona M03 coupe, is positioned at a lower price point than Xpeng’s existing models.

Xpeng, based in Guangzhou, began its global expansion in 2020 and currently operates in over 60 countries and regions.

He Xiaopeng said the company is considering opening manufacturing facilities in Europe but has not set a timeline.

He also indicated Xpeng is open to acquiring other EV companies, as competition within China remains intense.

The company previously acquired the EV development unit of Didi in 2023.

Xpeng faces challenges from European Union tariffs on China-made EVs and rising competition from both Chinese and global automakers.

🔗 Source: CNBC

🧠 Food for thought

Implications, context, and why it matters.

Xpeng’s 2026 launch timeline aligns with a broader pattern of Chinese automakers rapidly expanding internationally, with Chinese EV sales in emerging markets like Thailand and Brazil now surpassing those in the US.
The company’s faster-than-expected global growth, reaching 60 countries from just 3-5 markets two years ago, reflects how Chinese manufacturers are outpacing European automakers like BMW, Mercedes-Benz, and Audi.
This expansion comes despite significant headwinds, including EU tariffs ranging from 7.8% to 35.3% on Chinese EVs, which are designed to protect European manufacturers from perceived unfair competition.
The aggressive international push makes strategic sense given that China accounts for nearly two-thirds of the projected 22 million EV sales in 2025, providing Chinese companies with massive domestic scale advantages.

Xpeng’s Mona M03 starting price of $17,000 in China demonstrates the extreme price competitiveness possible in the domestic market, where EVs are often cheaper than comparable internal combustion engine vehicles.
However, this pricing advantage may not translate directly to international markets, where the average transaction price for new EVs remains at $57,734 in the US market, and the price gap between EVs and traditional vehicles has only narrowed to $9,644.
The company will need to navigate different market dynamics abroad, where Chinese manufacturers are restructuring supply chains and partnering with local battery manufacturers like CATL to reduce costs while meeting regulatory requirements.
Xpeng’s openness to acquisitions signals recognition that competing globally requires more than just low prices. The company may need to acquire local capabilities and partnerships to succeed in mature automotive markets.