KUALA LUMPUR (Oct 27): Chinese EV maker XPeng Inc is considering Malaysia as a hub for AI and technology development for its electric vehicles (EVs) in Southeast Asia.

Vice-chairman Dr Brian Gu told The Edge that the company plans to localise vehicles and tap Malaysia’s advanced semiconductor industry talent. Talks are underway with the government and industry partners to introduce AI-driven features like autonomous driving and smart cabins to the Malaysian market.

“We are actually talking actively with the Malaysian government and also other stakeholders, to think about what else we can use Malaysia as a hub for.

“Clearly, I think localisation for vehicles is important — so we will be making that investment — but also I think we recognise Malaysia has advanced semiconductor industry, very good talents that we can actually use, as well as a good ecosystem with the companies that can provide us with support in adopting some of the latest, for example, IC design technologies.

“So, we will be interested to really explore these capabilities and make Malaysia potentially as a hub for our AI overall technology development,” Gu said in an interview on the sidelines of the Asean Business and Investment Summit on Oct 26.

Through its local partner Bermaz Auto Bhd (KL:BAUTO), XPeng launched the G6 in Malaysia in August 2024 and the X9 in March 2025, selling 979 EVs up to September and ranking fifth among EV brands.

Bermaz has completed feasibility studies for local vehicle assembly of XPeng models and plans to start completely knocked down (CKD) assembly by the second half of 2026.

Malaysia is promoting itself as a regional EV hub with tax incentives, but full import and excise-duty exemptions for fully built EVs end this year, while locally assembled units retain benefits until 2027, encouraging localisation to stay competitive.

Like other Chinese EVs, XPeng faces European Union tariffs of up to 45.3% to protect European automakers. While Europe remains a key market, Gu said XPeng sees Southeast Asia as a more promising growth area.

XPeng has been producing the X9 in Indonesia since July 2025, with plans to assemble the G6 there as well.

Bermaz holds a 29% stake in Inokom Corporation, a contract assembler for Mazda, KIA and Chery, as well as an 11.54% stake in EP Manufacturing Bhd (KL:EPMB), which recently expanded into automotive assembly with partners including SAIC Motor.