Byton raises funding as volume production will start by end of year
Byton is to obtain a new round of funding within weeks from investors led by FAW Group, as the three-year-old Chinese electric car startup is to unveil its first production model in the third quarter of this year.
"We have attracted a number of deep-pocketed investors and FAW has started its due diligence investigation as the lead investor," said Byton CEO Daniel Kirchert last week. He made the remarks as Byton opened the doors of its near-completed plant in Nanjing, Jiangsu province, to media and dealer representatives.
"Our fundraising is going very smoothly and we will complete the round by the middle of the year," he said, without giving a figure.
Bloomberg reported that the startup aims to raise about $500 million, which would value the company at more than $2.5 billion. It said FAW, a top investor and partner, will inject $100 million in this round.
Byton has acquired a production license through its partnership with FAW. It will also produce electric vehicles for FAW's premium Hongqi brand. This will start in 2020 at its Nanjing plant.
The 11 billion yuan ($1.6 billion) plant, where production equipment is installed and tested, will have an initial production capacity of 150,000 vehicles a year. This is to expand to 300,000.
Kirchert said the first production model, the M-Byte SUV, will premiere in the third quarter and volume production will start by the end of the year. The model's platform can be used for sedans and MPVs as well, according to Duan Lianxiang, Byton's vice-president of research and development in China.
Byton, which derives its name from "bytes on wheels", positions itself as a maker of smart premium vehicles. Its rivals include Audi, BMW and Mercedes-Benz.
Although its rivals are rolling out electric vehicles, Kirchert said they are unlikely to excel. He added that it has little to do with their resources.
"Our target customers are those born in the 1990s, who grew up with smartphones and would like to have a smart mobile terminal as well.
"While their (Audi, BMW, Mercedes) customers are 55 years old on average globally, which means they have to move slowly with their products. And that is the greatest opportunity for us," said Kirchert.
Byton said it is working with China's internet giant Baidu in voice control and navigation for its M-Byte SUV.
Entertainment and rating apps have been installed to offer occupants easy access to videos, music, restaurants and concert tickets through the car's signature 48-inch display.
Byton has started to build a sales network. Its sales company was established in March. While customers are placing orders through its app, Kirchert said Byton will build 30 brick-and-mortar dealerships by the end of the year.
It is planning more showrooms as well, with one to open in Chongqing, Southwest China, by the middle of 2019. The first showroom, in Shanghai, opened in January. Byton is expected to build showrooms in Europe and the United States after 2020.
Kirchert said Byton has received more than 50,000 orders for its M-Byte, half of them from overseas.
