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Chinese electric vehicle maker XPeng (NYSE:XPEV) is developing advanced chips for Volkswagen (OTCPK:VLKAF) (OTCPK:VWAGY) cars, according to a report from the Financial Times.
The company has reportedly created self-designed Turing processors, which it claims perform even better than those made by U.S. semiconductor giant Nvidia (NVDA). The advanced chips are expected to enhance computing capabilities in future Volkswagen models, potentially improving features such as autonomous driving systems and in-car entertainment options.
The chip development marks a dramatic new phase in the partnership between XPeng (NYSE:XPEV) and Volkswagen (OTCPK:VLKAF). In July 2023, Volkswagen (OTCPK:VLKAF) invested $700 million for a 4.99% stake in XPeng (NYSE:XPEV), initiating a strategic alliance to co-develop electric vehicles tailored for China.
XPeng’s (XPEV) Turing chip is described as an in-house, AI-focused processor designed to power the next generation of intelligent vehicles, robots, and flying cars. Developed since 2020 and successfully taped out in August 2024, the Turing chip is engineered specifically for AI applications, including advanced driver-assistance systems and large AI models.
Looking ahead, XPeng (XPEV) has signaled that its in-house developed Turing AI smart driving chip will be open to partners in the future. “Developing chips is fundamentally a long-term commitment, as Xpeng envisions doing a lot of things across cars, aircraft, and robotics,” XPeng CEO He Xiaopeng stated in an interview.
Shares of XPeng (XPEV) were 2.6% lower in premarket trading to $19.90 vs. the 52-week range of $6.60 to $27.16.