Benzinga | Jan 24, 2022 07:07AM EST

Nio, Xpeng Among Chinese EV Makers Looking To Try Out Tesla-Like Die-Cast Technology With Guangdong Hongtu

Chinese aluminium alloy casting company Guangdong Hongtu Technology on Monday launched a 6,800-ton integrated die-casting unit that could supply to at least two U.S.-listed Chinese electric vehicle makers, cnEVpost reported, citing the company.

What Happened: Nio Inc (NYSE:NIO) and Xpeng Inc (NYSE:XPEV) are among electric vehicle makers that entered Guangdong Hontu's supply chain last year.

Guangdong Hongtu would work with subsidiary L.K. Technology to buy eight large and super die-casting units.

Executives of Nio and Xpeng are said to have participated in the launch event.

See Also: Tesla Giga Press Supplier Says 6 Chinese Automakers Want Similar Tech Next Year

Why It Matters: Electric vehicle leader Tesla Inc (NASDAQ:TSLA) is known to use large-scale integrated die-casting technology that is seen as the key to improving manufacturing efficiency for electric vehicle makers.

The Elon Musk-led Tesla has been investing heavily in casting and alloy technology and uses a series of big die casting machines to make car bodies with just a few massive casted parts, a trend that is now catching on in the auto industry.

The Giga Press, as it is known, is seen as Tesla's latest leap in manufacturing and is used to produce the Model Y. The technology reduces the Model Y's front and rear casting from hundreds of parts down to just two.

At least six China-based electric makers have reportedly shown interest in adopting the Giga Press technology.

Price Action: Nio shares closed 6.1% lower at $27.35 a share on Friday.