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Chinese electric car maker Xpeng collects $ 2 billion in credit

Chinese electric car maker Xpeng collects $ 2 billion in credit

He Xiaopeng, CEO of Xpeng, stands next to the company’s P7 electric sedan as he addresses the media at the 2020 Beijing Motor Show.

Evelyn Ching | CNBC

In July 2020, the local subsidiaries of Four of the “Big Five” banks provided 10.4 billion yuan in credit to Niu It has its startup operations in China headquartered in Hefei, near Shanghai. Participants in this deal include China Construction Bank, Industrial and Commercial Bank of China, Bank of China and Agricultural Bank of China, according to an announcement from Nio.

In the state-dominated system in China, banks prefer to lend to state-owned companies. This makes it difficult for privately owned companies to obtain financing, unless they can convince state-owned banks that they can repay loans.

The Xpeng line of credit announcement comes after the company raised more than $ 4 billion last year in its initial public offering on the New York Stock Exchange in August and a subsequent offering in December.

Shares have jumped more than 195% since the IPO.

Where does the money go?

The startup did not disclose details of the credit terms on Tuesday. The agreement will help the Guangzhou-based company expand manufacturing, sales, services and other operations, according to the statement.

Xpeng said it began building a second plant in November. The company said it had opened 116 Facades of retail stores And 50 service centers, as of September 30th. Xpeng disclosed in September Investing in developing flying vehicles.

Deliveries totaled 27,041 last year, with more than half of them from a new P7 sedan beginning mass deliveries in late June. The company added that it delivered 100 units of its G3 SUV to customers in Norway in December.

Although overall deliveries more than doubled compared to last year, Xpeng’s numbers reached no more than 43,700 deliveries at Nio. Nio cars targeted the higher end of the market, while Xpeng’s price range was lower.

In the past two weeks, both companies have announced plans for new sedans. Nio’s is expected to arrive in the first quarter of next year. Xpeng claims its sedan will start deliveries later this year.

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