The battle to build electric cars will be hard-fought.
Chinese Tesla-killer. That's a term you've probably heard us say a million times over the past couple of years. China is host to hundreds of startup companies that are all trying to be the next Tesla. Some of them have shown some promise, like Byton, a company that has raised over $500 million to build its handsome-looking SUV. Unfortunately, these companies are all facing stiff competition, and Bloomberg reports that only 1% will actually survive.
This stat comes from Chinese venture capital fund Nio Capital, which is partly backed by a Chinese electric car manufacturer NIO. Nio Captial managing partner Ian Zhu said: "It's a very complicated system that needs abundant investments and a large group of people to be able to build a car from scratch. Therefore, the survival rate of all these EV startups will be very low." Nio has its own impressive EVs including the 643-horsepower ES8 SUV and the bonkers 1,342-hp EP9 supercar, which was the fastest car to ever tackle the Hillclimb at Goodwood. Unfortunately, building mass-market production cars is not the same as building a handful of impressive demo cars.
Manufacturing continues to be the big issue for these startups. Building cars isn't easy, and even Tesla has struggled to do it in volume. Most of these companies in China have yet to produce EVs in large numbers and deliver them to customers. Reaching this goal will likely weed out the 99%.