China's EV Startups Defy Funding Slump With $6 Billion of Deals

tech.hindustantimes.com:

China's electric vehicle startups are defying the venture capital winter.

While the country is leading a global contraction in VC investment, its auto sector has taken the top spot for funding so far this year, with more than 147 deals amounting to $5.95 billion, according to data from research firm Preqin. Much of that has been from capital flowing into EVs, with batteries and semiconductors — two other high-growth sectors in the new-energy vehicle chain — in fourth and fifth place. All three have logged more deals than last year, while fundraising for once-hot industries like internet businesses, education and real estate have fallen off a cliff.

The biggest deals this year include Changjiang Capital's $1.57 billion bet on a high-end electric car startup founded by Renault China CEO Soh Weiming, and a $1.17 billion Series A round for Sunwoda's EV battery unit, driven by investors including Shenzhen Capital Group and National Green Development Fund Management, according to Preqin.

“Pretty much the only market that's doing extremely well is the EV market,” said Jochen Siebert, managing director at JSC Automotive. “For now it's the last game in town you can play.” Behind the boom: ample state support, not just through tax breaks and cheap loans but also through capital investment.

EV brands of legacy automakers like GAC's Aion, SAIC's IM Motors and Dongfeng's Voyah have also each bagged hundreds of millions of funding. Local upstart Hozon Auto, which targets rural areas and smaller cities with more affordable electric cars, raised over 3 billion yuan ($420 million) in a Series D round in July as it eyes an initial public offering in Hong Kong.

The sector has remained buoyant because the retreat in foreign venture