Tesla Motors Inc will have a new rival going forward; NextEV, which is an electric car maker backed by a group of deep-pocketed Chinese internet entrepreneurs and financial investors including Tencent and Hillhouse Capital, says a report from Reuters.
NextEV enjoys solid backing
On Monday, a NextEV spokesman said that Martin Leach, the ex-Ford Motor executive, has been hired to develop a global automaker. Experts who have worked with major car firms such as Tesla, BMW AG, Volkswagen and others have been hired by the backers.
Several of the Chinese tech moguls with little or no automotive background are eager to make a mark in the electric car segment, and the NextEV investors are among those only. The Chinese government is supporting this effort by NextEV investors, and it recently changed the rules for boosting investment by non-automotive firms. Alibaba, Xiaomi and Leshi are few tech firm based in China that have announced or have plans to venture in the electric car segment, says the report.
Jili Liu, a NextEV spokeswoman told Reuters that its first model will be an electric supercar that will outperform all “combustion supercars.” This sportscar can make its debut in 2016, and will be designed in a manner to produce more than 1000 hp, and takes just 3 sec. to accelerate to 62 miles per hour.
“We’re happy to see other people use the Model S sedan and our business model as benchmarks, whether they are large companies or well-funded start-ups,” said Ricardo Reyes, Tesla Motors Inc said on Monday.
Tesla asks White House for help in China
Meanwhile, Tesla has asked the White House for help in China. Foreign car brands are forbidden from assembling vehicles in China without a local partner, and the country also imposes heavy import duties on the foreign cars, note auto industry analysts. No such restrictions are imposed on the Chinese firms, who sell their cars in the U.S.
Last week, Tesla Motors Inc said that the Chinese firms do not need to sell controlling stakes to American firms, and are not required to face other trade hurdles that the U.S. firms have to face in China. The executive added that the American car firms are at a significant disadvantage in China as they are required to establish a joint venture for local manufacturing.
On Monday, Tesla shares closed up 0.23% at $249.06. Year to date the stock is up over 12% while in the last one-year, they are down almost 8%.