China has no shortage of electric vehicle (EV) brands and they all seem to have seized on the word ‘future’ in their marketing. But what’s the line-up in the EV sector in the present day?
One of the earliest manufacturers to showcase a vehicle was LeEco, which unveiled the LeSee sedan in April 2016. Company founder Jia Yueting declared that he was building “transportation for the future”. (LeEco has since run out of money and the car seems unlikely to have much of a future at all.)
Then there is Future Mobility, a Tencent and Foxconn-funded automaker which debuted its all-electric SUV Byton at Las Vegas’ annual Consumer Electronic Show in January. Additionally Tencent is a shareholder of Nio, while Tencent’s archrival Alibaba is one of the key shareholders in XPENG Motors (see WiC397).
Resultingly, the launch of another EV start-up was always going to lack some of the same wow factor – even if it did fall back on familiar terminology. “Electric is the future – and the future is now,” trumpets the advertising material from SF Motors, which had its formal launch in the US last week.
SF, which stands for San Francisco, is the California-based unit of Sokon Industry Group, an automaker from Chongqing. Sokon is listed in Shanghai and carried a market value of about Rmb17 billion ($2.7 billion) as of this week.
The firm was founded in 1986 by Chongqing native Zhang Xinghai. It started as a small factory making springs for local auto parts makers. Then it branched out into more sophisticated shock absorbers. In 2003, according to the Beijing News, Sokon became the first private sector automaker to cooperate directly with a state-owned car firm (the Dongfeng Group) in producing low- cost minivans, which remains its core business.
Sokon’s ambitions in electric vehicles are much more recent, however, beginning with the $110 million takeover of the Indiana-based heavy vehicle maker AM General last June. A few months later SF Motors also bought a battery technology firm headed by a former Tesla executive for $33 million. SF Motors is run by Zhang’s son, John Zhang. And in an interview with the Economic Observer last week, Zhang junior insisted his start-up would survive the brutal competition in the EV universe. “The market is huge… There are many opportunities for all and I don’t believe there would be only two to three companies standing at the end,” he said.
Indeed, China Money Network reports that there are at least six Chinese EV start-ups worth $1 billion or more, adding up to a combined valuation of nearly $20 billion in the sector.
Another is Youxia Motors, which announced last week that it has raised Rmb5 billion ($794.7 million) from Chinese private equity investors.
Meanwhile Sokon continued to grab headlines this month by hinting that it might develop its own driverless car in partnership with leading AI firm Baidu.
The announcement resulted in a spike in the company’s shares, Beijing News said, but it also attracted the attention of market regulators. The Shanghai Stock Exchange has ordered Sokon to provide more details on the substance of the tie-up with Baidu.
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