Forbes Contributor: LeEco To Build $3B Electric Car Factory In China
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I write about the Chinese car
market.
Opinions expressed by
Forbes Contributors are their own.
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LeEco
LeSee, by Tycho de Feijter.
LeEco has announced plans for
the construction of a new electric car factory in China with a total investment
of 20 billion yuan or 3 billion USD.
The factory will be located
in Huzhou City in
Zhejiang Province. It willmanufacture the LeSee “Tesla Killer” and
other yet-to-be unveiled electric cars. The factory will be part of an
industrial park that will include an R&D center and facilities for building
batteries and electric motors.
Construction is scheduled
to begin late this year or early next year. Phase 1 will cover an area of 4,300
acres for a car making capacity of 200,000 units annually. Phase 2 will double
that to 400,000 units, but it is unclear when that will happen.
The announcement comes as a
surprise. LeEco said earlier it wanted to outsource production of its electric
cars to an existing Chinese car maker and focus on software and design. They
had talks with Beijing Auto and with Guangzhou Auto but that apparently came to
nothing.
The authorities appear
surprised as well. State-owned China Dailyreports that it is
unclear whether the factory was “approved by industry regulators.” Approving
these sort of big plans usually takes a long time with involvement of the
central government, various agencies, and local governments.
The sudden and unexpected announcement might indicate there is no improvement yet. That does not mean LeEco won’t get it, but the company doesn’t make it easier. Authorities might feel LeEco is forcing their hand and there is nothing the bureaucrats hate more than that.
Another question is where the money will come from. LeEco has beenexpanding madly over the last couple of years, spending billions of dollars in the process. The company was founded in 2004 as LeTV, and they fast became the largest online video and TV provider in China, the “Chinese NetFlix”.
Source: Forbes
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