As the EV landscape continues to develop, VW is considering using its Chinese-based software to level the playing field and cut production costs.
According to a report from Reuters, VW is considering rolling out its China Electronic Architecture software to its European models as early as next year. The software, which was developed in collaboration with Xpeng.
The software was co-developed as part of a strategic partnership between the two brands to develop two VW EVs in China. This partnership expanded in August 2025 to include a jointly developed electrical/electronic architecture for VW’s internal combustion engine and plug-in hybrid vehicles in China.
The proposed software rollout would cover about three-quarters of the brand’s next-generation EV models in Europe, including the ID and Golf. ID, Passat and offerings from Skoda and Cupra.
Currently, VW has developed two distinct software suites for their vehicles. One is the Xpeng co-developed architecture, used only in China, and the other is a software suite being co-developed with Rivian.
According to insiders, cost is the main driver, as switching to the Chinese software could save the car brand four to five billion euros. However, using the software in the highly regulated EU market could add costs, and some believe the cost savings could be lost during adaptation.
Per the reports, VW will take the recommendation to the board later today.
VW did not provide a comment on the report.
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