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One of China’s major electric car makers Xpeng has announced the receipt of $400 million in funding from several firms including Xiaomi.
Chinese electric vehicle company Xpeng Motors Technology Ltd. has announced it has completed a new round of funding from several investors, to the tune of $400 million. Major Chinese tech firm Xiaomi Corp., is reported to have earned itself a position with the recent funding, as a strategic investor.
CEO and Chairman of Xpeng Motors, He Xiaopeng, together with Alibaba Group Holding Ltd and a few other unnamed investors, were among the contributors in the recently concluded Series C funding round. The CEO said that the company’s shareholders were also very responsive to the funding efforts, and has further highlighted Xpeng’s relationship with Xiaomi, who’s CEO and founder Lei Jun had invested in the company before now.
Jun in a recent statement has stressed the relationship between both companies and the success they’ve had with creating effective interconnectivity between products from both countries. The statement reads:
“Xiaomi Corporation and Xpeng Motors have achieved significant progress through in-depth collaboration in developing technologies connecting smart phones and smart cars. We believe that this strategic investment will further deepen our partnership with Xpeng in advancing innovation for intelligent hardware and the Internet of Things.”
Back in June, Xpeng announced that so far, it had shipped out 10,000 units of its electric G3 sports utility vehicle (SUV), as it joins a growing Chinese market of electric vehicle makers which already includes NIO Inc and Evergrande’s upcoming Hengchi brand, as well as an external market with Tesla Inc. – currently the global number one.
As part of its funding efforts, the car company also specified that it had received unsecured credit lines worth “several billions” in China’s Yuan, from financial institutions such as China CITIC Bank, HSBC and China Merchants Bank, without specifying how much in particular.
Xpeng’s last announced valuation was set at 25 billion yuan ($3.56 billion USD) back in August 2018. The company is yet to announce its current valuation after the recent series C funding. However, in its plans for growth and expansion, Xpeng had previously hinted that it intends to go public. The company, however, did not disclose when it will run its initial public offering (IPO) or how much it might be looking to raise.
Since the June announcement of 10,000 G3 units, the company has also unveiled an improved version, and has added that it will release an electric P7 sedan which will begin shipment sometime in the second quarter of 2020.
The market for electric vehicles in China for 2019 has not been as vibrant as it is in other parts of the world where there’s demand. In the last few months, sales have dropped considerably, because the government has been seriously cutting down on subsidies paid on electric vehicles. Last year, sales of electric vehicles surged in China by almost 80% but going forward, experts speculate that many of the companies might eventually die out.