Potential Tesla Competitor NextEV Receives Financial Backing From Internet Entrepreneurs

In an effort to create NextEV, a potential new rival to electric carmaker Tesla Motors, a group of deep-pocketed China-based Internet entrepreneurs and financial investors have come forward to help take the company’s plans to the next level.

The investors include Tencent and Hillhouse Capital, the latter also being an investor in Uber. The backers have hired ex-Ford Motor executive Martin Leach in an effort to build a global automaker, a NextEV representative said. The backers have also recruited auto experts with prior experience at Tesla, BMW, Volkswagen and other major car companies.

The NextEV investors are among several Chinese technology entrepreneurs who are hoping to create new electric car companies, even though they have little or no automotive background. This effort receives support from the Chinese government, which recently changed its rules to encourage investment by non-automotive companies. Chinese tech companies that have announced or are considering investments in electric car ventures include Alibaba, Xiaomi Technology and Leshi.

Shanghai-based NextEV has established offices in both Europe and the United States, and its creation is a sign that a gradual shift toward electric vehicles, which are simpler to design than traditional cars, has lowered the barriers to entry into the auto industry. Additionally, the Chinese government has provided generous incentives to encourage the production and sale of EVs.

“The first model launched by NextEV will be an electric supercar,” NextEV representative Jili Liu told Reuters. “This EV supercar is expected to outperform all combustion [engine] supercars in the world.”

If everything goes according to plan, the company’s sports car will debut in 2016. It will be designed to produce more than 1,000 horsepower and it will accelerate from 0 to 62 miles per hour within 3 seconds, according to the company’s representative. NextEV plans to follow up this feat with the launch of a range of high-performance family cars.

The company is being backed by Chinese Internet company Tencent; William Li, the founder of Internet content provider Bitauto.com; Xiang Li, the founder of automotive website www.autohome.com.cn, and Richard Liu, the founder of e-commerce website JD.com. Hillhouse Capital, which was started with seed money from Yale University, is another backer of NextEV.

Leach, the former chief operating officer at Ford of Europe, is currently working on recruiting hundreds of employees to work in San Jose, California, Shanghai, Munich, Beijing, Hong Kong and London. The NextEV representative indicated that Leach’s role is as co-president, but declined to elaborate any further on the leadership structure of the company.

Among NextEV’s hires are Danilo Teobaldi, the former chief of vehicle concepts at Italdesign Giugiaro; Juho Suh, a former senior designer at BMW, and John Thomas, a former senior program director at Tesla, according to their LinkedIn profiles. Thomas, who also previously worked as an engineer at Ford and GM, helped lead the development of the Tesla Model S from 2006-2008.

NextEV declined to reveal the full extent of its financial backing, saying that it prefers to keep such details confidential. The representative indicated the company will initially target China as a market and will expand to additional regions at a later stage.