The financing of new forces of unlisted car manufacturing is in full swing Car companies have increased the mid-range market of new energy vehicles

Reporter Gong Mengze

On February 21, it was reported that Hezhong New Energy (hereinafter collectively referred to as "Nezha Automobile"), a company affiliated to the Nezha Automobile brand, has recently completed a new round of financing of more than 2 billion yuan, and the main investment institutions include CRRC Group's CRRC Fund and Shenzhen Venture Capital with a state-owned background in Shenzhen, and the valuation of Nezha Automobile has jumped to 25 billion yuan.

The person in charge of Nezha Automobile told the Securities Daily reporter that the company has opened a Pre-IPO round of financing with a target valuation of about US$7 billion (about 45 billion yuan) and plans to start an IPO in Hong Kong within this year.

Most of the new car-making forces started around 2015 and have shown a multi-polar trend after several years of development. The head three brothers Weilai, Xiaopeng and Ideal gathered in the US stock market, and the stock price soared after the listing, and the investors behind them made a lot of money. And those new force car companies that are slightly slower are mostly living in the shadow of the head camp.

However, considering the huge scale of the automobile market and the differentiation of consumer demand, there are currently more than 10 smart electric vehicle players with a certain scale in China, and these new forces and new cross-border entrants are gaining more capital favor.

According to the reporter's incomplete statistics, according to the comprehensive ranking of models, sales and selling prices that have been disclosed, the estimated output value of mainstream unlisted new force car companies in 2021 is: WM Automobile 6.5 billion yuan, Nezha Automobile 5 billion yuan, zero-run car 3 billion yuan, Lantu Automobile 2 billion yuan, Xilisi 1.7 billion yuan, Extreme Krypton and Polar Fox are 1.5 billion yuan.

Financing of new energy vehicle companies

Volume and price rose together

All along, building cars has been a game of "burning money". After experiencing the big waves and sand, the competition for new car-making forces is still continuing.

The continued optimism of capital stems from the dual expectations of policy and the market. By the end of 2021, the domestic new energy vehicle field has received more than 70 financings throughout the year, exceeding the level of the same period in 2020, with a total financing of more than 80 billion yuan. Among them, the three listed car companies of "Wei Xiaoli" (that is, Weilai, Xiaopeng and Ideal) have their own cash reserves of more than 40 billion yuan, and the follow-up "ammunition" is guaranteed.

Judging from the situation of other new car-making forces, Nezha Automobile completed the third round of D series financing this time. In October last year, Nezha Automobile announced the completion of a D1 round of financing of 4 billion yuan, led by 360 Group; in December of the same year, Nezha Automobile disclosed the D++ round of financing participated in by CATL, 360, AND BAIC Production and Investment.

At the same time, WM Motors, which is also the first dark horse of the new car-making force, also completed the D1 round and D2 round of financing at the end of 2021, with a total cumulative financing of 457 million US dollars. Among them, the D1 round of financing was led by internationally renowned investment institutions such as PCCW, with a financing amount of more than US$300 million. The D2 round was led by Agile and raised approximately US$152 million. The above financing has also become the largest amount of private equity investment in the international capital market in 2021 in China's new local pure electric vehicle companies. Up to now, WM Motors has carried out 11 rounds of financing, with a total financing of about 35 billion yuan.

It should be pointed out that most of the new car-making forces have been supported by local industrial funds. According to the national enterprise credit information publicity system, the registered capital of Fujian Yundu Automobile is 900 million yuan, which is held by Fujian Automobile Industry Group Co., Ltd., Putian State Investment Corporation, Fujian Haiyuan, etc.; at the beginning of the establishment of Zhejiang United Automobile, Tongxiang United New Energy Automobile Industry Investment Partnership accounted for 75% of the shares; as the "heart meat" of Jiangxi Shangrao, Aiway Automobile received 1 billion yuan of investment from Shangrao Mingchi New Energy Innovation Investment Center in 2019.

"Our opponents are traditional fuel vehicles, not tram counterparts." The person in charge of the new force car company told reporters that the new energy vehicle market cake is large enough, with the support of local governments, as long as the strategy is appropriate and the product is excellent, survival is a winner.

Mid-market

It will be a place of contention

At present, the mainland electric vehicle market shows the characteristics of "dumbbell type". The A00-class and A0-class car market represented by Wuling Hongguang miniEV and Euler Black Cat and the high-end models represented by Tesla are hot at both ends, while the mid-range electric models with prices of 150,000 yuan to 250,000 yuan have not seen large-scale growth in sales.

However, such market structures are quietly changing. The reporter observed that the domestic head enterprises that were originally positioned as high-end new forces are rapidly moving closer to the mid-end mainstream market, focusing on the incremental space of 150,000 yuan to 250,000 yuan for layout. For example, Xiaopeng Automobile's new P5 is priced at 150,000 yuan to 250,000 yuan; WEILAI ET5 has dropped to 250,000 yuan after adopting the BaaS financial solution; ideal has announced that it will release at least two new cars in 2022, covering a complete range of 150,000 yuan to 500,000 yuan.

In this regard, Shen Hui, founder, chairman and CEO of WM Motor, told the Securities Daily reporter that the market structure of new energy vehicles in the mainland will inevitably accelerate optimization to the "spindle type" in the future. It is expected that by 2030, electric models in the price range of 150,000 yuan to 250,000 yuan will occupy about 60% of the market share, and the penetration rate will increase from 3% to 40%.

With the arrival of the "spindle"-type market structure, the 150,000 yuan to 250,000 yuan models led by WM will sit on the benefits of "home battle". Some analysts pointed out that the mid-range mainstream tram products not only maintain a reasonable price range, but also can quickly apply more forward-looking technology to the mainstream price point. For consumers, it can benefit from the rapid popularization of smart electric vehicles, and for enterprises, it will incubate highly growth-oriented investment targets.