Chinese EV start-up Xpeng Motors gets £1.5-billion line of credit

Sam Dickerson

12 Jan 2021

Tesla rival Xpeng planning to use funds to build its EV business operation, production, sale and service systems.

One of China's leading smart electric vehicle start-up companies has received a whopping £1.5-billion line of credit from five major Chinese banks.

Xpeng Motors, headquartered in Guangzhou, China and with offices in Silicon Valley, USA, specialises in the design, development and manufacturing of electric vehicles that are seamlessly integrated with advanced Internet, AI and autonomous driving technologies.

The latest agreement came after the company completed its first public follow-on offering in December 2020, raising approximately £1.8-billion to help build its business operations, production, sales and service systems. Xpeng also boasts two of its own manufacturing plants, one of which is due to open in 2021.

Xpeng has started to push to establish itself in the European EV market, shipping 100 of its G3 electric crossover models to Norway in December 2020, before the company introduces the model to other major EV markets in Europe later this year.

The G3 claims to have a WLTP-certified range of 280 miles from a 66kWh battery pack, and can reportedly charge its battery from 30% to 80% in just 30 minutes. The G3 has also been awarded five stars in China’s C-NCAP crash tests, plus, with a recommended retail price of around £30,000, the G3 should be competitive against other similarly-specced EVs.

Alongside the G3, the Alibaba-backed Xpeng will also offer their Tesla-inspired P7 sedan, which claims a Model 3 beating 416-mile range. Xpeng plans to sell the P7 from around £24,000, which would undercut the Model 3 by nearly £19,000.

The battle between the two brands has been well documented online, with Tesla boss Elon Musk claiming Xpeng stole some of its code and even suing a former Tesla employee, Guangzhi Cao, a former engineer, claiming he allegedly gave the secret code to Xpeng.

After Tesla initially filed the lawsuit, Cao admitted to downloading some of Tesla’s Autopilot source code, but he claims to have deleted it before leaving the automaker and never having transferred it to Xpeng, as Tesla claim.

In a response to the accusations and lawsuit, Xpeng released a statement to Bloomberg, stating, "Tesla’s latest demands crossed the line, seeking to rummage through our IP on Tesla’s terms — and smearing us along the way with misrepresentations and innuendo. Tesla’s attempt to tie the two Chinese engineers together is ‘peddling speculation and stereotypes."

Even though Xpeng only sold its first car back in 2018, the company managed to deliver a total of 27,041 vehicles through 2020, which is a year-on-year hike of 112%, and the company is expected to launch another two models this year to compliment its G3 and P7 offerings.

Brian Gu, Xpeng’s vice-chairman and president, recently told Autocar the company's long-term plan for establishing a domestic Chinese brand in Europe, “We believe that technology is key in changing people’s perceptions and we note that brands such as Samsung and Kia have succeeded,” Gu said.

“We also think that the legacy European auto brands might not have the same brand advantages in the market for EVs. We want to build a long-lasting presence. It is not easy to get a strong brand globally, but we are very confident in our product.”

Sam Dickerson

12 Jan 2021

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