A new factory-backed arm of XPeng has assumed control from the previous distributor, TrueEV, in what appears to be a developing legal dispute.

The factory-backed entity has stated that it has commenced direct operations in Australia, supported by newly appointed local employees and a dealer network, effective immediately.

According to the new entity, this transition will include the introduction of customer support infrastructure and factory-backed logistics to service customers nationwide, with the exception of Tasmania and the Northern Territory, where the brand has yet to establish a presence.

The company has stated that it remains "deeply committed to the long-term stability and continuity of the Australian market" and is actively recruiting for multiple roles.

In contrast to the factory takeover involving BYD, which appeared to proceed amicably with its distributor EVDirect, the situation involving XPeng is expected to lead to a legal dispute with TrueEV.

TrueEV recently entered external administration after managing XPeng's operations in Australia since 2024, despite holding a five-year distribution agreement.

While the distributor had previously indicated that a factory-backed transition was anticipated and could occur earlier than initially planned, reports published by a local news outlet suggest that TrueEV intends to initiate legal proceedings against XPeng, alleging unconscionable conduct following the termination of its distribution agreement on January 1st this year.

According to claims made by TrueEV, XPeng had undermined its operations since 2024 by withholding new products and disrupting its dealer network through revised approval requirements. These actions allegedly forced TrueEV to delist certain dealers and terminate its partnership with Ultra Tune.

TrueEV has further alleged that these developments rendered it unable to sell vehicles through its established network of 15 dealers and 58 service locations.

The matter is expected to proceed to the Federal Court unless a settlement is reached beforehand. The dispute may affect the factory-backed entity's operations, particularly if TrueEV seeks legal measures to restrict the company's activities until the case is resolved.

These developments provide context for XPeng's limited progress in Australia following the launch of the XPeng G6, positioned as a competitor to the Tesla Model Y.

Although the brand, under TrueEV, had announced the XPeng G9 and XPeng X9, and had also indicated plans to introduce the XPeng Mona M03 as an electric fastback, these models have not yet been launched in the market.

This situation coincides with a period during which Chinese electric vehicle brands are expected to benefit from elevated fuel prices to expand their market share.

In contrast to XPeng's initial activity followed by slower subsequent developments, its rival Zeekr experienced a comparatively uneven initial phase with the Zeekr X and Zeekr 009. This was followed by improved market reception for the Zeekr 7X, with further developments anticipated for the Zeekr 8X.

Further developments regarding XPeng's operations in Australia are expected.