Key details of XPeng’s ongoing legal troubles in Australia have been exposed.
The brand is currently defending allegations of breaching its agreement with estranged Australian distributor True EV.
The Federal Court of Australia has emphatically denied True EV’s interlocutory injunction application to prevent XPeng from establishing a factory-backed operation in Australia.
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True EV was seeking to restrain XPeng from distributing or servicing cars, accessories and parts under its own name in Australia.
The trial will get underway in October with run time estimates ranging from five to 15 days.
“The result is that XPeng’s brand and entry into the Australian market for electronic vehicles appears to be in a state of considerable dysfunction,” justice Jackman said.
“There is no cogent basis to indicate that this state of affairs will change if True EV remains XPeng’s exclusive distributor.”
True EV failed to make the first of two security costs payments for the proceedings totalling $1,256,860 that was due to be paid by 31 May 2026 on time.
The brand attempted to make a grand entrance into the Australian market, including the acquisition of a standout showroom situated near Sydney Airport.
Such theatrics flattered to deceive, with delayed launches and limited sales defining a turbulent Australian introduction.
Court documents have revealed XPeng gave True EV notice to terminate its exclusive distributor rights and install a new operation on 1 January 2026.
“XPeng has formed the view that the sales and service network will function much better with XPeng Motors Australia Pty Limited also distributing XPeng vehicles,” an excerpt from the contract stated in the judgment read.
The notice stated that this request did not terminate True EV’s right to distribute XPeng vehicles.
The distribution arm of True EV went into external administration in March 2026.
A spokesperson for the distributor told CarsGuide earlier this year this concerned appointed receivers from financiers Helios for 197 cars.
The company remains in external administration, according to the Australian Securities and Investments Commission (ASIC).
XPeng appointed True EV as its exclusive distributor in 2024 for a five-year period, with the prospect of a further extension.
True EV commenced legal proceedings in the Federal Court of Australia against XPeng in March.
True EV claims XPeng’s decision to change the distribution model constitutes early termination and is thus compensable.
It further claims it is entitled to a reasonable opportunity to make a return on its investment.
XPeng exposed key details of its relationship with True EV in its submissions relating to the defunct interlocutory injunction.
The brand said True EV has ordered relatively few vehicles and only a modest fraction of the order targets.
True EV has been largely unable to place and proceed with orders on the payment terms specified in the distributor agreement.
True EV ordered and paid for less than a third of the obligatory orders targets.
It has sought to deal with this by pressuring XPeng to process orders on payment terms requiring XPeng to bear payments risks not required of it under the contract.
True EV has not proceeded with any new vehicle order in over 12 months, according to XPeng.
XPeng also stated it could have lost up to $14.5 million in Australian operation set-up costs if the interlocutory injunction were to be enforced.
The Australian Broadcasting Corporation reported earlier this month customers who purchased XPeng cars earlier this year haven't received $5000 cashback offers promised by the True EV operation.
XPeng Australia is pushing on in the meantime with the launch of an updated version of its G6 electric mid-size SUV.
CarsGuide has contacted True EV for comment, but has yet to receive a response.
A spokesperson for XPeng Australia said the brand is committed to resolving issues affecting customers who purchased XPeng vehicles through True EV.
"We recognise the frustration and inconvenience this has caused and are committed to putting things right," they said.
"That’s why we have established a dedicated customer-care channel and a review process which has already resolved some customer issues and is expediting others."
