January 29, 2018 / 9:06 AM / 2 months ago

Alibaba, Foxconn lead $350 million funding in electric car startup

BEIJING (Reuters) - Alibaba Group Holding Ltd and Foxconn Technology Co Ltd have led a 2.2 billion yuan ($347.74 million) funding round in Chinese electric car maker Xiaopeng Motors as competition escalates in the new energy vehicle (NEV) market.

A view of the Alibaba Group booth during the 2018 CES in Las Vegas, Nevada, U.S. January 9, 2018. REUTERS/Steve Marcus

The latest injection brings the startup company’s total funding to 5 billion yuan, it said in a statement. It follows an earlier round in December in which Alibaba also participated.

Xiaopeng, which debuted its electric car at CES in Las Vegas this month, is one of several Chinese start-ups looking to speed up development of battery-powered technology and compete with global leaders including Tesla Inc.

China’s new energy vehicle sales are expected to grow by 40 percent in 2018, according to an industry body, even as the country’s traditional automotive market slowed sharply in 2017.

The logo of Foxconn, the trading name of Hon Hai Precision Industry, is seen on top of the company's headquarters in New Taipei City, Taiwan March 29, 2016. REUTERS/Tyrone Siu/File Photo

Xiaopeng says its first vehicle, the ‘G3’, will hit the market this year.

Alibaba has invested heavily in smart car technology and partnered with a handful of traditional western and Chinese carmakers, including Ford Motor Co and BMW.

Other investors in the round include IDG Capital as well as previous investors GGV Capital, Morningside Venture Capital and Matrix Partners, Alibaba said on its press site on Sunday.

Russian billionaire investor Yuri Milner is also supporting the initiative, the web site said.

($1 = 6.3265 Chinese yuan)

Reporting by Cate Cadell; Editing by Gopakumar Warrier

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