Chinese EV startup XPeng is at the center of major trade secret disputes with Apple and Tesla

Last summer, a former employee of Apple was indicted by the FBI for stealing trade secrets related to a secret self-drive vehicle project. This week, Tesla sued a former employee for stealing trade secrets related to autopilot. They have been around for months, but the two sets of claims have something in common. Each of the employees is estimated to seek information on a Chinese electric vehicle starter called Xiaopeng Motors.

Xiaopeng Motors or XPeng was not well known in the western region, but it grew rapidly in China despite the overly crowded areas in the EV boot space. Now it's close to the heart of these two major trade secret destruction. It is therefore important to understand exactly what the company is.

What is XPeng?

According to Michael Dunne, who runs ZoZo Go, an automotive consulting firm, China has spent decades relying primarily on state-owned automakers to build its automotive industry. But he said that the Chinese government has changed a few years ago, when he began to encourage key technology investors to enter the automobile space. "We have added a fresh and fresh dimension to the Chinese auto industry," he said. Tencent and Alibaba saw that he was the potential answer to China's ambition to make world-class vehicles.

. XPeng was born out of this change. The company was founded in 2014 by Xiaopeng, a mobile Internet entrepreneur named Guangzhou Xiaopeng Motors Technology. There are several different names, such as Xiaopeng Motors or XMotors, but most commonly referred to in the industry as XPeng.

He founded the company after selling the mobile browser company called UCWeb to Alibaba, a spokesperson for e-commerce in China, at the time of the largest merger in Chinese history. Alibaba was favorably positioned to lead the $ 350 million financing round (including Foxconn) for the next project, XPeng.

XPeng presented its first electric car at CES 2018. All electric SUVs called GES are similar to Tesla's Model X. It looks like a model X and features a cockpit layout very similar to the huge portrait-oriented touch screen tablet built into the dashboard. Your car has recently begun shipping to its first owner.

Connect with Tesla

These similarities are not accidental. "Tesla gave me a big shock," he said in his 2018 interview with Quartz . In fact, he said one of the reasons he founded Xesen is that Tesla released the patent in 2014. He said he was able to better understand how Tesla's cars were dismantled and how they were made.

Tesla noticed. In a lawsuit filed against employees this week, Tesla acknowledged that XPEN designed the vehicle for Tesla's open source patents and transparently imitated Tesla's design, technology and business models. The booster builds a network of fast chargers and sells them directly to consumers.

Tesla introduced XPeng's "X-Pilot" software like "Autopilot" and Chinese startup "(19659014) Tesla encouraged other companies to use its patented EV technology, Obtaining and using confidential source code that supports Autopilot will provide tremendous benefits to competitors when trying to duplicate Tesla's current self-driving technology and help predict future developments.

Connect with Apple

In addition to employees billed last summer, there is less direct contact with Apple, but a senior researcher at Strategic International Research Center, a non-profit policy research organization According to James Andrew Lewis, Silicon Valley Chinese startups (Chinese or Chinese)

"If Chinese employees learn useful skills and want to go home, retire or return to China with some sort of commercial or technical secret, What we want is a common practice, "says Lewis." This has happened for decades. "

Last summer, federal prosecutors arrested former Apple employee Xiaolang Zhang, stealing circuit boards and stealing more than 40GB of data related to the company's secret self – driving car projects. Zhang told Apple and federal investigators that XPeng He said he was trying to get a job, but what he did before he was arrested was not clear at first. When XPeng eventually responded to the charge, he admitted that Chang started work with the company.

Former Apple and Tesla employees are indicted for each charge and lawsuit, not the company itself

There are some important differences between the two cases: In December 2015 Zhang, who worked for Apple in California from May 2018, filed a lawsuit against federal law Guangzhi Cao worked in Tesla, California, from April 2017 to January 2019. He filed a lawsuit this week in the California civil court, where he was not penalized for stealing trade secrets

The main difference in the Cao case was that he was hired by XPeng at the time of writing. Tesla said that he was a Tesla employee XPeng claims to have stolen hundreds of thousands of files and directories containing Autopilot source code, and XPeng claims to be able to benefit from theft, but only Cao was named defendant.

Verge has "thoroughly maintained the intellectual property and confidential information of third parties. And "it said that it has begun an internal investigation into the alleged theft of Cao. "Cao did not induce or attempt to misuse the trade secret, confidential or proprietary information of Tesla, and did not know Cao's misconduct," XPeng said.

Zhang issued a similar statement after his arrest last year. "We have always focused on the protection of intellectual property rights and have always regarded the principle of compliance of all employees as the basic principle," the statement said. "Zhang signed an intellectual property compliance document on the first day of the company in early May. The record shows that he did not report sensitive or violating information to XPeng."

EV boots denied any involvement and " I will actively cooperate. "

This incident is an attack on US technology companies sponsored by the government with numerous accusations against the Chinese?

According to Dunne not directly. This is likely to be the result of the situation and pressure of the booming Chinese automobile market, which is booming.

Three years ago, Dunn quickly realized, "Making electric cars like Tesla is cool and very advanced," he quickly realized that technologies like electricity are not tens or hundreds of differentiated technologies. . Dunne says automotive companies are emerging in China.

Advanced technologies like autonomy help differentiate players like XPeng from the rest. Dunne says: "So they are looking for a technology that they need to find, quickly acquire, or develop a technology that they are not working on," he said. "There is an urgency to explain why some companies are taking shortcuts, including stealing intellectual property." [19659030] The urgency to differentiate in a crowded environment adds pressure to start – ups

"If Beijing says that everyone should start making electric cars, In response to the reaction. One way that you can do that is to leap, and one way to leap forward is to recruit people from an American company that has the skills and knowledge to use. "

Dunn also notes that XPeng and its competition are" independent actors who are confused to compete in an intensely competitive and increasingly crowded arena "on paper. "China is ultimately returning to the government to secure funds and loans," he said. "Local or state governments direct state banks to lend to these kinds of companies. "

We know about the Chinese government that has sponsored decades of" economic espionage "attacks that have lifted important intellectual property and confidentiality. Based on information from major technology companies, government agencies and contractors, It is not hard to imagine acting or at least blinding. " I do not desire to arrest the returnees, "says Lewis.

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