China’s burgeoning EV market, coupled with recent sales rebound, has opened an attractive opportunity for the country’s cash-burning EV makers to raise funds necessary for them to compete in the cutthroat domestic market.
Backed by investors like Chinese e-commerce titan Alibaba and smartphone giant Xiaomi, Guangzhou-based Xpeng Motors raised $1.5 billion in an initial public offering on the New York stock exchange in August, as the firm saw what Brian Gu, vice chairman and president, referred to as “a window of opportunity” brought by the share price rallies of US-listed counterparts including Tesla and Nio.
Jixun Foo, managing partner of global VC firm GGV Capital – an early backer of Xpeng – is also of the view that the momentum in China’s EV development is accelerating: “Certainly, there is a path [to profitability] that Tesla has painted for emerging EV players like Xpeng and Li Auto.”
