XPENG is raising more than US$900 million for its robotics business in what the company describes as the largest single-round private funding deal to date in China’s embodied AI sector.

The Series A round values XPENG’s robotics division at more than US$6.3 billion, with the automaker retaining controlling ownership.

The funding is being led by IDG Capital, with participation from Gaorong Ventures and strategic backing from Tencent and Alibaba.

XPENG plans to use the capital to accelerate hardware and software development, improve its physical AI foundation models and generate the high-quality data required to train its systems. The company is also investing in mass-production facilities and international expansion.

At the centre of the programme is the next-generation XPENG IRON, a general-purpose humanoid robot being developed as a key part of the company’s physical AI strategy.

IRON features 76 degrees of freedom, including 21 in each hand, and uses XPENG’s proprietary AI hardware platform. Three Turing AI chips provide up to 2,250 TOPS of computing power, allowing AI models to run directly on the robot rather than relying entirely on remote processing.

XPENG is also applying its automotive manufacturing expertise to robotics, with the aim of bringing automotive-grade production standards to humanoid robots.

Mass production of IRON is planned for the end of 2026, with initial deployments expected at XPENG stores and corporate campuses. Wider deliveries in China and overseas markets are scheduled to begin in 2027.

Sven De Smet, XPENG Europe’s Head of Brand & Marketing, described the investment as a shift from humanoid robotics demonstrations toward scalable, real-world deployment.