Auto veteran leads startup for mass-mar­ket e-car

China Daily (USA) - - BUSINESS - By BLOOMBERG

A for­mer top ex­ec­u­tive be­hind China’s big­gest ac­qui­si­tion of an over­seas car­maker is set­ting out to make his­tory twice, rais­ing $1 bil­lion in an ini­tial fundrais­ing round as the lat­est home­grown elec­tric ve­hi­cle startup to chal­lenge Tes­laMo­tors Inc.

Free­man Shen left Volvo Cars owner Zhe­jiang Geely Hold­ing Group Co in 2014 and last year founded WM Mo­tor, which he says has se­cured fund­ing from both do­mes­tic and over­seas in­vestors. WM plans to in­tro­duce its first model in 2018 and boost pro­duc­tion to more than 100,000 units an­nu­ally within the fol­low­ing three years, he said.

“We have pro­found ex­pe­ri­ence in the in­dus­try, which dis­tin­guishes us from other startup com­pa­nies, even Tesla,” Shen, who’s worked in the auto in­dus­try for 22 years, Free­man Shen, said in an in­ter­viewin Shang­hai. “We don’t want to make toy-like lux­ury cars for the mi­nor­ity. We will tar­get the mass mar­ket.”

The sum WM said it’s raised is a show of con­fi­dence in a startup com­pet­ing with more than 200 Chi­nese elec­tric-ve­hi­cle com­pa­nies, some backed by the likes of Alibaba GroupHold­ing Ltd’s JackMa, Fox­conn Tech­nol­ogy Group’s Terry Gou and Ten­cent Hold­ings Ltd’s Ma Hu­ateng. Both tra­di­tional au­tomak­ers and the bevy of star­tups see po­ten­tial in the govern­ment’s com­mit­ment to boost yearly sales of new-en­ergy ve­hi­cles — its term for plug-in hy­brid and fully-elec­tric cars — by 10-fold in the next decade.

Star­tups rarely reach the so-called uni­corn sta­tus of a$1 bil­lion val­u­a­tion in ini­tial fund­ing rounds. Zhe­jiang Ant Small& Mi­cro Fi­nan­cial Ser­vices Group Co, known as Ant Fi­nan­cial and con­trolled by Alibaba’s bil­lion­aire chair­man Ma, raised funds at about a $40 bil­lion val­u­a­tion in June 2015. Tesla started with just $7.5 mil­lion in April 2004.

WM was named af­ter the Ger­man word welt­meis­ter, which means global cham­pion. Its man­age­ment team has ex­ten­sive ex­pe­ri­ence in China’s auto in­dus­try, rang­ing from prod­uct devel­op­ment, parts pro­cure­ment, pro­duc­tion and sales, ac­cord­ing to Shen.

The com­pany joins a frenzy of up­starts seek­ing to speed up in­vest­ment in­China’s elec­tric-car sec­tor. Che­he­jia, founded by in­ter­net en­tre­pre­neur Li Xiang, said on Aug 10 it be­gan con­struct­ing an as­sem­bly plant with even­tual ca­pac­ity to make 300,000 ve­hi­cles a year. Just hours later LeEco, backed by bil­lion­aire Jia Yuet­ing, an­nounced plans to in­vest as much as 20 bil­lion yuan ($3 bil­lion) in a ve­hi­cle plant in east­ern China and an auto theme park.

WM is de­vel­op­ing cars us­ing two plat­forms and con­duct­ing road tests, Shen said. The com­pany plans to ap­ply for a pro­duc­tion li­cense later this year and set up a fac­tory in east­ern China, he said, de­clin­ing to give more de­tail.

Shen at­tended Har­vard Busi­ness School’s Ad­vanced Man­age­ment Pro­gram while work­ing for Geely, which bought Volvo from Ford Mo­tor Co in 2010 in the largest over­seas ac­qui­si­tion by a Chi­nese au­tomaker.

We have pro­found ex­pe­ri­ence in the in­dus­try...” Mo­tor founder ofWM

JONATHAN ALPEYRIE / FOR CHINA DAILY

A Ci­tibank credit card user with­draws money from an ATM in Hong Kong.

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