What is xref in AutoCAD? What is its primary purposes?

Let say you are a piping draughtsman/ civil draughtsman

You would need the mechanicals and the structures to complete your piping

You would then X-ref in on a mechanical or structural layer the mechanicals and the structurals

you would then continue to do your piping

When you finished you can then turn the layer of especially if you submit you drawing for checking because the checker would have his /her own mechanicals and structurals

If want to make the structurals part of your drawing you would you the bind command

But remember if it is binded and the mecchanicals change you have to delete that layer and bring in the new structures or mechanicals