Didi Global's EV business has been acquired by XPeng Motors. The €693 million transaction will prepare the path for the debut of a new, inexpensive EV brand codenamed "Mona," scheduled for 2024. Not to mention that VW recently acquired a sizable stake in XPeng.

XPeng is well-known for its high-end, intelligent electric vehicles, such as the G9 SUV and P7 electric sedan. Didi, on the other hand, is a Chinese ride-hailing powerhouse. The acquisition allows XPeng to have access to Didi's enormous mobility network, while Didi gains a strategic stake in XPeng.

XPeng intends to reach an entirely new market segment with this move. The project, currently codenamed "Mona," aims to manufacture A-class smart EVs priced around €19,220 and aimed at the mass-market segment. This is a considerable shift from XPeng's present offering, which targets a more upscale audience. The Mona will be a new brand different from XPeng's existing products, with the goal of accelerating the company's manufacturing and sales growth.

Didi will also offer assistance through its nationwide shared mobility market, which is a fancy way of saying that Didi's enormous network of ride-hailing services would help promote and maybe use Mona vehicles. The corporations have even set performance incentives dependent on Mona and Didi's sales targets being met in mass manufacturing. Didi might gain up to 5% of XPeng's stock if Mona sells like hotcakes - 180,000 units every year for two years in a row.


He Xiaopeng, XPeng's CEO, was sceptical about the feasibility of supplying competitive self-driving features in the €19,220 pricing bracket around two years ago. Today, he's singing a completely different song. Mr. He now sees a "clear path" to selling completely autonomous driving cars in this price range, thanks to technological advancement and cost reduction.
While the collaboration appears to be promising, there are still many unknowns. It's unclear whether XPeng will develop a totally separate channel for the Mona project, for example. Furthermore, Didi's CEO, Cheng Wei, has expressed significant uncertainty about the auto industry, which may explain why Didi sold its EV company in the first place.

Didi had planned to develop automobiles under the codename "Da Vinci," but that project has since been scrapped. This project's R&D personnel and equipment will be moved to XPeng. So, in some ways, Mona is Da Vinci's more successful sibling, the result of the marriage of two industrial titans.
The XPeng-Didi collaboration has the potential to be a game changer in the EV market, particularly in the inexpensive sector. However, like with any ambitious endeavour, the road ahead is fraught with challenges and uncertainty. For the time being, all eyes are focused on 2024, when the first Mona model is slated to hit the road. Will it be the low-cost, smart EV that many had hoped for? Will the course be altered along the way, and we'll see yet another expensive electric SUV?