A charging cable is seen hooked to a car at a State Grid Corporation of China charging point for electric vehicles in Beijing, China March

China is betting billions on unproven electric car startups

$3.6 billion

China is betting big on home-grown electric car startups like Alibaba-backed Xiaopeng Motors—valued at $3.6 billion—that have yet to produce a single vehicle.

Published   |  Photo by Reuters
A charging cable is seen hooked to a car at a State Grid Corporation of China charging point for electric vehicles in Beijing, China March
$3.6 billion

Xiaopeng, also known as Xpeng, completed a 4 billion yuan ($580 million) funding round last week. Its customers have pre-ordered more than 6,000 of its G3 model.

A charging cable is seen hooked to a car at a State Grid Corporation of China charging point for electric vehicles in Beijing, China March
$3.6 billion

Early adopters will be waiting for a while: Xiaopeng plans to deliver at least 1,000 SUVs by the year’s end, while other startups are struggling to scale production on similar promises.

A charging cable is seen hooked to a car at a State Grid Corporation of China charging point for electric vehicles in Beijing, China March
$3.6 billion

Beijing’s seeing a surge in demand for plates for electric cars

A charging cable is seen hooked to a car at a State Grid Corporation of China charging point for electric vehicles in Beijing, China March
$3.6 billion

NIO, a startup backed by Baidu and Tencent, shipped 1,000 cars by July, after delays. It plans to deliver 10,000 cars this year. Fellow unicorn WM Motor has set a similar schedule.

A charging cable is seen hooked to a car at a State Grid Corporation of China charging point for electric vehicles in Beijing, China March
$3.6 billion

Right now, China’s EV startups have an edge. Many of their SUVs range from 200,000 to 400,000 yuan ($29,220 to $58,440)—far less than the starting 897,900 yuan ($131,000) for Tesla’s Model X.

A charging cable is seen hooked to a car at a State Grid Corporation of China charging point for electric vehicles in Beijing, China March
$3.6 billion

But the clock is ticking: Tesla’s incoming China factory could allow its locally made cars to avoid steep import taxes, making them cheaper for Chinese buyers.

A charging cable is seen hooked to a car at a State Grid Corporation of China charging point for electric vehicles in Beijing, China March
$3.6 billion

Global electric car sales are projected to hit 1.6 million in 2018

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