Xpeng Motors has brought onboard smartphone maker Xiaomi as a strategic investor, as the Alibaba-backed new energy vehicle (NEV) startup announced $400 million in Series C funding.
Why it matters: Xpeng’s hefty haul comes against a macro-industrial backdrop of falling sales after subsidies for electric vehicles were cut over the summer, creating an increasingly difficult funding environment for NEV startups.
Major players including Nio are struggling to get close to sales targets as NEV deliveries stalled in the second half of the year.
Sales fell sequentially for three consecutive months beginning in July, while year-on-year rates of decline deepened from 4.7% in July to 34.2% in September.
It is a business that is still very much in the ramping up stage and we have to invest in research and development, in building our sales and services network, and completing our manufacturing plant, which we aim to have built by the end of this year.
We have been working closely with Xiaomi on smart devices and they have the IoT leadership in China, and even globally, and smart auto could be a very good extension of the ecosystem.”