LeTV is making greater investments in electric vehicle charging facilities. (Photo/China Daily)
Internet giants leading green auto wave
Internet entertainment giant LeTV Holdings has become a major investor in a new-energy vehicle charging station producer as part of its green auto campaign.
Beijing Dianzhuang Technology Co, a startup that builds and rents charging posts, said it has received "tens of millions of yuan" from LeTV, although the investor did not disclose a specific investment amount.
Jia Yueting, LeTV's founder and chief executive, said building charging infrastructure is the biggest obstacle for the new-energy auto market in China. He said selling electric cars before building charging posts "won't work".
Dianzhuang is now building the largest electric-car charging station in Beijing, near the capital's South Railway Station.
When complete, it will be able to charge 100 electric vehicles.
The startup has set up five centers across China and built charging stations in more than 30 cities, including Beijing, Shanghai, Guangzhou and Chengdu.
"The investment is a key step to expanding LeTV's presence in the new-energy automobile industry and we will work with more partners, such as equipment suppliers, in the future," said Sun Ke, LeTV's senior investment director.
Earlier this year, LeTV released its electric auto plan that included the establishment of a research and development team of about 260 engineers in California's Silicon Valley. The company said the team has been working to produce an electric car for more than a year.
It also released a user interface for cars and said its new model will use the self-developed LeTV Operating System.
LeTV has become a large shareholder of Atieva, a designer of electric cars, such as the Tesla Roadster, Audi R8 eTron and Chevrolet Volt, headquartered in Silicon Valley.
It has also attracted many veterans in the automotive industry to its electric vehicle program.
Ding Lei, former vice-president of SAIC Motor Corp, recently joined LeTV and became a co-founder of its electric-car unit Leshi Super Electric Car Co, said Jia Yueting, founder and chief executive of LeTV.
Many other Chinese Internet companies are also showing interest in the automotive industry.
China's e-commerce company Alibaba Group Holding and automaker SAIC Motor Corp announced earlier this year that they would invest 1 billion yuan ($156.2 million) to develop Internet-connected vehicles. The fund will promote the development of "cars on the Internet" and build operational platforms for the cars.
Chinese reports said a 50-50 joint venture between SAIC Motor and Alibaba will be set up based on the fund. The joint venture aims to roll out China's first Internet car in 2016.
Tencent Holdings, Baidu Inc and Xiaomi Corp are all marching into the sector through either partnerships or acquisitions.
Miao Wei, minister of Industry and Information Technology, said in March that China encourages Internet companies to develop electric vehicles.
It is estimated that there are about 120,000 new-energy vehicle owners in China but only 30,000 charging posts.
Despite the lack of charging infrastructure, new-energy vehicles are gaining momentum in the country.
China sold 108,654 units in the first eight months of this year, a 270-percent rise from the same period last year. Of those, the majority were pure electric models.
Citing consulting firms' estimates, LeTV said the auto charging infrastructure industry will generate 33 billion yuan in 2016 and 100 billion yuan in 2020.