XPENG’s robotics arm has raised more than $900M ahead of its humanoid production run

Funding and Valuation

XPENG, the Chinese electric vehicle maker, announced on Monday that its robotics business has raised more than US$900 million in what it described as its first funding round. The investment values the unit at over US$6.3 billion, marking the largest single-round private financing in China’s embodied AI industry, according to the company. The South China Morning Post reported that the unit, named Dogotix, is a subsidiary of Xpeng, and that investors including Alibaba and IDG Capital contributed to the round.

While XPENG’s own statement did not list investors, the Post detailed that Alibaba, Tencent Holdings, IDG and Gaorong Ventures together invested US$600 million, with Xpeng itself pledging US$200 million. The Post, which noted Alibaba’s ownership of the newspaper, called the deal the biggest single private-equity transaction involving a Chinese robotics maker.

The Next Web, covering the same announcement, pointed out that XPENG had previously raised US$100 million for its robotics work in July 2022, though it described the new round as the company’s first formal funding round. The publication also noted that the investor list and valuation were not published in the company’s release.

Financial Results

The funding arrives as XPENG reports a widening quarterly loss. In the second quarter, the company’s net loss grew 179% year-on-year to RMB1.34 billion (US$199.4 million), according to both the Manila Times and the South China Morning Post. Research and development costs jumped 32.1%, the Post reported.

Revenue for the quarter totaled RMB19.74 billion, up 8% from a year earlier, the company said. XPENG’s gross margin reached 20.7%, the Manila Times reported. The company did not break out robotics revenue, as the unit has yet to sell a single robot commercially, a point underscored by The Next Web.

XPENG’s core automotive business showed signs of strength in overseas markets. Overseas deliveries surpassed 20,000 units in Q2, up 81% year-over-year, and overseas markets contributed 25% of first-half revenue, according to the Manila Times. The average selling price exceeded €40,000 in the quarter, the publication added.

IRON Humanoid and Production Timeline

The robotics funding is intended to support the production of IRON, XPENG’s humanoid robot. The Next Web reported that IRON was unveiled at XPENG’s AI Day in November 2025 and uses the company’s own Turing chips. The robot features more than 60 joints, a spine with five degrees of freedom, and a layer of bionic muscle fascia. The seventh-generation prototype has been demonstrated, with an eighth generation earmarked as the production model.

XPENG has committed to putting IRON into mass production before the end of 2026. The company said it expects to launch IRON officially in 2027, with large-scale deliveries to external customers in China and overseas in the retail and service sectors. Monthly production capacity could ramp to several thousand units by 2027, according to the Manila Times.

The Next Web noted the tight timeline, describing the company as “running out of calendar” to meet its production deadline. The publication also reported that He Xiaopeng has taken personal charge of the robotics division, and that Shi Xiaoxin, senior director of robotics product planning, recently departed — a change The Next Web suggested is noteworthy.

Initial deployments will be close to home: IRON is expected to work as a showroom assistant, tour guide, campus patrol, and on factory floors, with commercial deliveries following in 2027. The Next Web noted that BYD has already committed to placing humanoids in its showrooms, a pattern that helps generate deployment numbers without requiring external customers.

Long-term, XPENG aims to produce a million robots a year by 2030. He Xiaopeng has said robots could be priced “very similar to car prices” within five years, with software accounting for more than half the value, The Next Web reported.

Broader Strategy: ADAS, Robotaxi, and New Models

Beyond robotics, XPENG is advancing its driver-assistance technology. The company said its VLA 2.0 model will undergo a major upgrade in China starting at the end of August, integrating vision-language-action and vision-language models to enable integrated cockpit and autonomous driving functions. Selected L4 capabilities developed for its Robotaxi will be brought to passenger vehicles. The company aims to obtain regulatory approval for VLA 2.0 in Europe in the first half of 2027, the Manila Times reported.

In robotaxis, XPENG’s mass-produced Robotaxi powered by VLA 2.0 has completed over 2,000 internal test orders in Guangzhou. The company’s goal is to achieve passenger-carrying operations without a safety driver by 2027.

In its vehicle lineup, XPENG reported that the GX SUV delivered over 7,000 units domestically in July, making it a top-three model in China’s NEV SUV segment above RMB300,000. The G9L SUV is set to launch in September. The company’s L03 model secured “historic order volume” at launch, with overseas deliveries expected to start in Q4, potentially driving quarterly overseas deliveries above 40,000 units, the Manila Times reported.

Outlook and Leadership Commentary

He Xiaopeng, chairman and CEO, emphasized the company’s transformation into a global leader in physical AI. In a statement quoted by the Post, he said he believes XPENG will build one of China’s most valuable humanoid robotics companies and become a global leader in physical AI, spearheading large-scale adoption of humanoid robots and autonomous driving.

The company, which The Manila Times described as having a “high-growth trajectory,” has established a group-level strategic business development team to commercialize physical AI, the publication reported.

Despite the upbeat framing from XPENG, The Next Web noted that the company’s first-quarter revenue declined 17.6% and that it posted widening net losses, after a profitable quarter before. Management has identified robotics, robotaxis, and flying vehicles as future revenue drivers, and raising outside capital keeps those expenditures off the carmaker’s balance sheet, the publication said.

Industry observers see momentum in the broader humanoid sector. The Next Web cited LimX Dynamics’ US$2.2 billion valuation and Morgan Stanley’s doubling of its forecast for Chinese humanoid shipments to 50,000 units as context for investor enthusiasm.

The funding and production milestones come at a time when XPENG is balancing heavy investment with financial strain, a tension visible across the reports.