Chinese startup NextEV raised about half of the $1 billion it seeks ahead of launching its electric vehicle lineup according to Bloomberg. Last month we wrote about NextEV coming out of stealth to reveal its plan to “disrupt” the electric vehicle market with yet another electric supercar and today we learn that the company is extremely well-funded by big-name VC firms: Sequoia Capital and Joy Capital.
NextEV has an interesting position in the Chinese car market because it has been set up by executives who have a lot of influence on the auto industry in China: William Li is the chairman of car-pricing portal Bitauto and Li Xiang is the founder of car-pricing website Autohome.
The company has over 300 employees and they are mainly research and development staff. Much like Tesla’s high-end to mass volume strategy, NextEV chose to first develop a supercar and then move on to a mass-market vehicle which they plan to offer for about $50,000 in China.
Sequoia Capital and Joy Capital investing in NextEV is interesting because it goes against the trend we have been observing recently in the EV market. Chinese companies have been heavily investing in California-based EV companies like Atieva, Faraday Future and LeTV. Some of these companies have received hundreds of millions in financing, but NextEV is ahead of the curve with half a billion and the money flow coming from the US and going to China instead of the other way around.
Experts are seeing regulations as the main driver fot the EV market in China. Yale Zhang, Shanghai-based managing director at Autoforesight Shanghai Co:
“Most consumers go for electric cars for the free license. With more cities capping issuance of license plates, it will be the biggest motivation for motorists to buy electric vehicles.”
NextEV company is planing on partnering with 2 automakers for manufacturing and even though they expects to enter the US market at some point, they will focus primarily on China.
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