CHINA’S XPENG MOTORS GETS $600M FROM GUANGZHOU GOV’T
Xpeng Motors has raised 4 billion yuan ($600 million) from the city government of Guangzhou and laid the foundations for the Chinese electric vehicle (EV) startup's second factory in three years, Nikki Sun reported for Nikkei Asian Review.
The government investment underscores the growing ties between the emerging EV startups and the state as China looks to nurture home-grown champions that can challenge Tesla. It comes a month after Xpeng Motors's $1.5 billion US stock market debut.
Guangzhou-based Xpeng, backed by e-commerce giant Alibaba, is one of the frontrunners among China's EV companies jockeying to take on Tesla, now the world's most valuable carmaker by market capitalization. The Guangzhou government, which is already an investor in Xpeng through a fund it controlled, is more than happy to help fuel Xpeng's growth.
Under the agreement, announced, a fund wholly controlled by the Guangzhou Economic and Technological Development Zone will invest 4 billion yuan to fund the building of a factory for Xpeng there, as well as procurement of equipment and further investments in securities issued by Xpeng. The government will also help Xpeng secure financing at interest rates of no more than 4%. "With the strong support from the Guangzhou government, we are confident we will execute on our strategic growth initiatives," said Xpeng's chairman and co-founder He Xiaopeng. The proposed Guangzhou plant is expected to start production in December 2022.
The Financial District would like to learn more from its audience. Can you please give us feedback on this article you just read. Click Here to participate in our online survey.