Investor Says 99 Per Cent Of China’s ‘Tesla Killers’ Will Perish

A Chinese investment company claims that just 1 per cent of China’s electric vehicle startups will make it in the long run.

NIO Capital says that the huge costs involved in starting an electric vehicle company from scratch is the main reason why 99 percent of the will fail.

NIO Capital? Yes, that’s the name of a venture capital fund that’s partly backed by Chinese electric vehicle startup NIO. Take what they say with a grain of salt then.

During an interview with Bloomberg, managing partner Ian Zhu appeared pessimistic about all of the so-called ‘Tesla killers’ emerging out of the country.

“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,” Zhu said.

More than half of the world’s electric vehicles are sold in China, so it’s no surprise that local entrepreneurs are looking to make their mark on the industry.

Competition is set to intensify in the coming years following the nation’s decision to allow foreign car brands to fully own their local units, encouraging the likes of BMW and Tesla to intensify their EV focus in China.

However, the ongoing trade war between the United States and China will make things more difficult than they need to be. According to Zhu, the trade war is an obstruction to the global economy and technology development.

“If it continues or escalates, it will delay the commercialization of intelligent electric cars as well as slow down global efforts to improve traffic safety and efficiency”, he commented.

NIO is making a serious run to establish itself as a formidable contender in the Chinese EV sector. The company recently started local deliveries of its ES8 SUV and claims to have already received 15,000 orders.

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  • Earl Scheib

    Yeeeaaaahhhhh… ok Ian zhu. Whatever.

  • Mr. EP9

    Maybe he has a point, or maybe NIO Capital having ties to NIO is compelling him to say that. NIO is in the electric car business as well and it would certainly benefit NIO if all the potential competition went under. Well, we’ll see what happens. Also, heard NIO was rolling out a mobile charging service. Doesn’t look very clean, unfortunately.

    • Хиллари сосет киску

      The source of the information in this article is too biased. This shouldnt even be an article.

      • I don’t think so, it’s not common for auto executives to talk about their rivals, in fact these days more executives seems to be dare to attack others (Like Bentley Designer on Lincoln Continental or Aston Executives about Bentley and R-R)

  • Bash

    Too bad…
    Too bad for lost better alternatives and opurtunities that can or could have happen if this obstacle is not there. Think about the lucid air for example.

    • Хиллари сосет киску

      There will be more and more EV options available in the future. Almost every legacy manufacturer now has some type of electrified program and/or product (GM, BMW, JAGUAR, FORD, PORSCHE, NISSAN,…). As for China, I’ve read there are currently close to 1000 EV manufacturers, so yeah it’s very likely that just a handful actually make it long term. Didn’t take a Dr degree to come to Ian’s conclusion.

  • S3XY

    Every year Tesla is suppose to go bankrupt and there’s suppose to be the “Tesla Killer” but here we are 10 years later and no one has attempted to challenge Daddy.

  • Jason Panamera

    Most of them are acting like start-ups. Making and early stage product and wishing being bought by bigger companies.

  • Not surprising really, a lot of this brands had little core values, and now they merely bought names of long dormant marque from Europe to be slapped on their cars like Borgward or Isdera. Or they just hired people like Giugiaro, Williams, Pininfarina and etc to develop cars for them.

  • Ed

    If the reports we have are correct, the Chinese government plans to throw its support behind just ten EV companies…so there goes a huge chunk any startups. This from last year:

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