Xpeng, an electric vehicle startup by former Alibaba CEO He Xiaopeng, said Monday it had raised around $ 500 million in a Series C + round to further develop models that are tailored to China's tech-savvy midsize consumers.
The announcement followed the $ 400 million Series C round that was completed last November. A source told theinformationsuperhighway that the company's valuation at that time had exceeded the 25 billion yuan ($ 3.57 billion) round it raised in August 2018.
With the new proceeds, the announced financing of the five-year-old Chinese startup amounts to $ 1.7 billion.
Last round investors include Hong Kong-based private equity firm Aspex Management; the famous American tech hedge fund Coatue Management; China's leading private equity fund Hillhouse Capital; and Sequoia Capital China. The other existing well-known supporters are Foxconn, Xiaomi, GGV Capital, Morningside Venture Capital, IDG Capital and Primavera Capital.
Despite the large round, Xpeng faces a number of challenges. Sales of electric vehicles in China have shrunk as a result of reduced government subsidies that went into effect last year, and the COVID-19 pandemic should continue to dampen demand as the economy weakens.
Xpeng's Chinese rival Byton, who has heavyweight supporters such as Tencent, FAW Group and Foxconn, is already showing signs of tension when he takes around half of his 450 North American employees on leave for coronavirus effects. In June, the company slowed down production for internal reorganization.
Xpeng's other competitors appear to have proven to be more resilient. In April, Nasdaq-listed Nio secured an investment of $ 1 billion for its Chinese company, while Li Auto dared to apply for a US listing in July.
Xpeng claims it has so far been able to withstand the challenges of the corona virus. In May, the company received a production license for its own auto plant in a city near its headquarters in Guangzhou, which indicates its lesser reliance on its manufacturing partner Haima Automobile.