Xpeng Motors collects $500M to develop more EVs
Xpeng, an electric vehicle start-up run by former Alibaba executive He Xiaopeng, has raised around $500 million in a new round of financing. The company says it wants to develop further models targeting tech-savvy middle-class consumers in China.
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XPeng had only launched the second model in China, the P7 this June. Also the recent funding follows an earlier capital injection of over 400 million dollars last November. The five-year-old company has now raised a total of 1.7 billion dollars in its financing rounds.
The group of investors include Aspex from Hongkong, the American tech hedge fund Coatue, a leading Chinese equity fund in Hillhouse Capital, and Sequoia Capital China. They join other well-known backers such as Foxconn, Xiaomi, GGV Capital, Morningside Venture Capital, IDG Capital, and Primavera Capital.
Despite new money coming in, times in China are difficult for EV makers. The effects of Covid-19 are still felt with new energy vehicle sales recovering only slowly. Xpeng, however, claims it has so far been able to withstand coronavirus challenges. The company received the official production license from the Chinese Ministry of Industry and Information Technology in mid-May for the plant that was built in around 15 months. Also, XPeng has two all-electric cars on the market with the P7 and G3. The latter, however, is still built at the third-party factory, Haima from the time before Xpeng got the license to build electric cars.
A look at Xpeng competitors may paint a more nuanced picture of the state of EV start-ups in China at the moment. Take Byton, for example, that is essentially on the brink of bankruptcy as reported. Admittedly, Byton never managed to launch a car to sell, unlike XPeng. Also, Nio has recently reported severe financial problems. At the same time, Nio announced a new financing round only today and has since continued to launch new electric car models on its home market. Here, Nio is banking on local governments and national banks and promises to essentially create growth in turn.
Update 03 August 2020: According to insider information, Xpeng Motors has expanded its $500 million finance round by another $300 million to $800 million. The additional investors are Alibaba and the Qatar Investment Authority (QIA). While Alibaba would expand the stake in Xpeng held since 2017, this will be the first time Qatar State Fund has made an investment in the electric car manufacturer.
According to the insider quoted by SCMP, Xpeng Motors would also seek a listing on the New York Stock Exchange. A possible time frame for the IPO has not yet been mentioned.
Update 08 August 2020: After it was leaked a few days ago in the course of a capital increase that Xpeng Motors is aiming for the US stock exchange, the Chinese electric car startup has now officially applied for an IPO. The shares of Xpeng Motors are to be traded on Wall Street under the symbol XPEV.
Update 27 August 2020: No less than 1.5 billion dollars in gross proceeds is what the Chinese EV startup Xpeng Motors plans to generate with its launch on the US stock market. It will issue 99.7 million shares at a price of 15 dollars each. Trading started last night.
The ADSs can be found under the symbol XPEV, and the offering is expected to close on 31 August 2020, subject to customary closing conditions.
techcrunch.com, xiaopeng.com, scmp.com (update), gasgoo.com, marketwatch.com (both update II), businesswire.com (update 27 August)
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hmm, that p7 looks so familiar, what is it…?