Under pressure of reduced subsidies, Sitech Dev announced a new round of fundraising.
Chinese electric vehicle (EV) maker Sitech Dev announced an objective of raising a new round of financing nearly two months after it completed Series B round on May 16 this year.
Xian Yue (先越), CEO of Sitech Dev, said the fundraising was expected to be completed by the end of 2019 as Sitech was in the final negotiation with investors.
The EV maker completed Series A round of funding on May 25 in 2018, raising around "hundreds of millions" US dollars, and CDH Fund (鼎晖投资) took the lead in this round. It further closed Series B round of funding on May 16 this year, with a market capitalization at USD 1.6 billion. Chinese local government fund led this round and unidentified investors participated.
Funds raised will be used to increase vehicle diversity and tap into market demand in response to deteriorating financing environment in EV industry.
Chinese EV startups confront big problems with financing in 2019 as the government reduced subsidies to EV industry. So far, Sitech Dev pushed out only one model of EV DEV 1. Under such circumstances, promoting vehicle output would actually incur more losses, said Xian Yue. Sitech plans to launch several models that do not rely on subsidies.
The EV startup also tends to seek innovation and profitability of business model through providing convoy services to mobility service platforms.
Potential investors include local investment funds and private equity firms. The size of funding has not been disclosed yet.
Sitech Dev was founded in 2017 also proving v2x (vehicle to everything), autonomous driving and shared travel services.