Electric Vehicle Startup Xpeng Motors Announces a US$500 Million Funding Round
Xpeng Motors, which is emerging as one of China's leading new electric vehicle startups, announced a new financing round equal to around US$500 million. The investors include Aspex, Coatue, Hillhouse Capital and Sequoia Capital China.
With its latest funding round, Xpeng is poised to become a strong competitor to Tesla in China. The latest funding round follows a Series C funding round of US$400 million in Nov 2019.
Xpeng, founded in 2014, is also backed by Chinese e-commerce giant Alibaba.
In April, Xpeng Motors began deliveries of its new, fully-electric flagship P7 sedan in China. It's the company's second electric vehicle. The P7, which Xpeng calls a "smart sedan", is a strong competitor to the Tesla Model S and Model 3 in China. The vehicle achieves an NEDC Range of 439 Miles, the longest of all EVs sold in China.
Unlike Tesla's vehicles, which sell at a premium in China, Xpeng is targeting younger, tech-savvy buyers its its more affordable, yet highly advanced electric vehicles. The automaker is offering the same level of technology, connectivity features and performance in the P7 for around $50,000 less than the Tesla Model S.
Xpeng Motors was inspired by Tesla, and studied many of its open source patents in the development of its own electric models.
The P7 sedan starts at RMB 229,000 (US$33,918) after subsidies. To qualify for New Energy Vehicle (NEV) subsidies offered by the Chinese government, vehicles must cost less than RMB 300,000.
The P7 sedan follows Xpeng's first electric vehicle the G3 compact SUV, which launched in Dec 2018.
Xpeng Motors partnered with battery maker Contemporary Amperex Technology Ltd. (CATL) to develop the P7's prismatic (pouch cell) lithium nickel manganese cobalt oxide (NCM) battery cells.
Unlike the cylindrical battery cells used in the Tesla Model S, pouch cell batteries are flat and can be stacked, eliminating wasted space so the battery pack can be made smaller and more energy dense. The ultra-thin battery pack of the P7 is only 110mm in height, reaching 170Wh/kg energy density and delivering just under 81kWh of power.
Xpeng is also working on its own advanced autonomous driving system called "XPilot" that will offer hands-free driving.
Xpeng's XPilot automated driving functions were specifically developed for China's unique road conditions, with automated features adapted for China's crowded urban roadways, including a unique "low speed follow function", which reduces the chances of aggressive drivers cutting in front of the vehicle in traffic. XPilot also supports self-parking, which is a popular feature for car buyers in China, the company said.
The new P7 sedan will run on Xpeng's XPILOT 3.0, the company's latest version of the advanced automated driving software, which is powered by the NVIDIA DRIVE Xavier system-on-a-chip (SoC).
The highly advanced P7 is equipped with 12 ultrasonic sensors, five high-precision millimeter-wave radars, 13 autonomous driving cameras, plus one in-car camera with HD maps and high-precision GPS.
It's the world's first production vehicle powered by Nvidia's powerful Xavier SoC, which is capable of delivering 30 trillion operations per second.
All of Xpeng's autonomous driving technology is developed in-house. Around 50% of its employees work in R&D the company said. The company's approach to developing all of its technology in house is apparently attractive to investors.
The signing of the Series C+ financing demonstrates investors' confidence in the company's strategy and its long-term vision of becoming a leading electric automaker in China, which is the world's biggest auto market. All of the company's vehicles are built in China.
Xpeng Motors secured a production license for its fully-owned factory in Zhaoqing, Guangdong Province in May 2020.
In March, the company announced it was granted permission from the National Highway Traffic Safety Administration (NHTSA) to test its new P7 fully-electric sedan on public roads in the U.S.
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