China must be allowing foreign battery manufactures product such as LG CHEM new plant in China into EV cars manufactured in China. Expansion even further for EV s in China. 500,000 EV cars from this plant alone.
Tesla Is Getting a China Factory.
This $4 Billion Startup Will Be Waiting
Xpeng has Alibaba and the government in its corner. Can it start selling electric cars before Elon Musk builds his factory?
China’s government is offering financial and political support for electric-vehicle companies as it attempts to lead the world in the field, fueling the rise of Xpeng and hundreds of other rivals. President Xi Jinping pledges to open markets and curtail protectionism, even as he lavishes assistance on domestic makers of electric cars, artificial intelligence and semiconductors. China’s electric-car buyers get price subsidies of as much as $10,000 per vehicle, for example, and can also dodge license plate restrictions that impede sales of gasoline-powered cars.
That support, combined with ample cash from China’s tech leaders and the comparative ease of building EVs instead of traditional cars, has seeded a crop of startups competing with such established automakers as BYD Co., Beijing Automotive Group Co. and Zhejiang Geely Holding Group Co.
Those established Chinese automakers have also benefited from Tesla’s slow arrival. Beijing Automotive sold 78,000 units of the budget BAIC EC180, China’s best-selling battery-powered car last year, five times Tesla’s China sales. Its sticker price in Beijing starts at 49,800 yuan ($7,453). The price of Tesla’s bigger Model S increased to 1.47 million yuan after the recent tariff hike.
Xpeng, which has 1,800 employees, conserved its initial financing, thanks to national and local support for land, office space and production facilities. The company used that cash for research and development, spending heavily in its earliest days to buy and disassemble two dozen Tesla, Lexus and BMW vehicles. It also poached a Tesla autopilot engineer, Gu Junli, to oversee an 100-employee autonomous driving and AI operation in Mountain View, California. A hardware engineer poached from Apple Inc., Zhang Xiaolang, was arrested on charges of stealing driverless car research last week at San Jose International Airport before boarding a flight bound to China. Xpeng denies receiving any sensitive information from Apple and says it has terminated Zhang.
By October 2017, Xpeng manufactured a batch of SUVs named David 1.0. Instead of opening public sales, Xpeng gave away or leased the 400 cars to employees who sent daily reports on technology glitches, manufacturing mishaps and design suggestions. The early feedback included requests to fashion more comfortable seats.
“It’s common to release software with bugs, but with cars it’s hard to come back if customers don’t like your first one,” He says.
That all led to January’s Consumer Electronics Show in Las Vegas, where Xpeng revealed its first car for sale: a cherry-red G3 with autonomous parking, a smartphone app to unlock the car, and a 360-degree camera ascending from the roof. By late November, Xpeng plans to start delivering some of the 4,000 pre-ordered G3 cars to enthusiasts plunking down non-refundable deposits. The cars will cost from 200,000 to 280,000 yuan, before subsidies kick in.
Xpeng is contracting production to Haima Automobile Group Co. in Zhengzhou. Plans call for a third model, a sedan with a bigger chassis, to be created in Xpeng’s own facility, under construction in Zhaoqing.
He acknowledges the considerable odds facing Xpeng, even with the support of China's tech giants and government. With a global supply chain spanning hundreds of thousands of parts, Tesla and other startups have struggled to ramp up production quickly – and Xpeng is no different.
“There are 300 EV companies in China,” He says, and the Darwinian struggle is just starting.
“In China, if you’re just copying from others, you are going to die. It’s the companies that learn from those like Tesla that will survive.”
www.bloomberg.com/news/features/2018-07-16/tesla-rival-hits-4-billion-valuation-before-selling-any-cars
