NIO has invested in about 40 companies in 5 years, and XPeng and Li Auto have also made outbound investments to build deeper moats.
(Image credit: Steven Lelham on Unsplash)
In addition to building cars, NIO, XPeng Motors and Li Auto are also investing in companies in the (new energy vehicle) NEV industry chain, with NIO being particularly active.
In an article today, WeChat account business-data highlighted the three companies' moves in outbound investment, arguing that their outreach to the NEV industry chain is helping to build deeper moats.
Here are the main takeaways from the article:
The Chinese EV trio, which has plenty of ammunition to build cars, seems to present a very different style of investment route:
1. NIO is leading the layout in venture capital, investing in about 40 companies in 5 years to create an industrial alliance.
2. XPeng has made a low-key entry, both into the field of flying cars and robotics to bet on the future, and is also grasping to make up for its own shortcomings.
3. Li Auto's investment aims to extend its reach into the automotive industry chain, revitalize idle assets and strengthen assisted driving technology.
These moves make NIO, XPeng, and Li Auto, which are well-capitalized and leading in the EV industry, further escalate the threshold for other players to compete and mean that investment and M&A projects available to new car makers in the second and third tiers become more scarce.
The companies that can "laugh last" must be more than just a single product that does well, but more importantly, their overall penetration of the automotive industry chain.
If you want to read more, you can copy the original Chinese text into Google Translate.
Original Chinese version: https://mp.weixin.qq.com/s/tRr2FJc25GjQHhnc5_Uh8w
URL of Google Translate: https://translate.google.com/
Note: Wei Xiaoli refers to NIO, XPeng, Li Auto, Xiaopeng refers to XPeng, and Ideal refers to Li Auto in the automatic translation.
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