China's 'Alphabet' raises $1 billion in funding to make electric cars
Electric vehicles are at home in China.
Jia Yueting (left) and LeEco’s LeSEE vehicle. Credit: Wikimedia Commons
LeEco, a billion-dollar Chinese technology company, was awarded $1.08 billion in funding by various Chinese investors to build its electric car business. The announcement comes only a month after another Chinese startup called WM Motor was granted $1 billion so it can release its first car by 2018 and make as many as 100,000 units/year by 2021.
Though China is the biggest source of carbon emissions in the world and often taunted as a dirty, polluted country for this reason, the nation is actually making important steps to transition to a carbon-free economy. China is the greatest producer of wind energy in the world, and as of this year also the greatest solar energy producer after it outclassed Germany following massive deployments of solar capacity. Overall, 2015 saw $100 billion flowing into renewable energy in China, but the money pouring into sustainability in general is likely far more.
China is the number one market for electric vehicles in the world. Forbes reports 170,000 units were sold in the first half of the year, marking a massive 162 percent increase. The local government has been instrumental in supporting this growth as EV buyers are offered free parking, free licence plates (these can cost thousands of dollars in a city like Shanghai) and subsidies worth up to $7,500.
In this ocean of possibilities, some entrepreneurs have seized the opportunity. Among them Jia Yueting, the CEO of LeEco, who is often called the “Chinese Steve Jobs”, or more recently the “Chinese Elon Musk”, by the mainstream media in his home country.
LeEco made its name by starting as an internet television company, but then quickly expanded in cloud computing, financing, online shopping, smartphones and autonomous vehicles. In April, LeEco showcased its first vehicle, the LeSEE. Possibly the car with the biggest grin in the world, LeSEE impressed a lot of people with its self-driving and self-parking features directed via a smartphone app.
After its new ~$1 billion investment, LeEco seems to mean business. This money will likely help the company build its planned $1.8 billion factory, which was announced last month.
Oddly enough, this investment round went on despite LeEco failing to receive a licence that might have enabled it to manufacture electric cars in China.
It’s worth noting at this point that LeEco also owns (possibly a major) stake in Faraday Future — a mysterious but highly ambitious car maker startup based in the United States. If the Chinese government still won’t grant LeEco a licence, the company’s technology can always get transferred to Faraday Future.
There’s still no release date for LeSEE, but early 2018 seems likely.
