Deal focus: Byton plans China luxury breakthrough

Cementing a global footprint while simultaneously entering mass production for the first time and pioneering new fields of technology is a tall order for any company. For a two-year-old electric carmaker, it is even tougher.

But Byton, a Chinese manufacturer of smart electric vehicles (EV), is pursuing its big ambitions. The company, which is backed by Legend Capital, plans to channel a recent $500 million Series B funding round into a global product rollout and marketing push as well as the perfection of a number of emerging sub-segments such as intelligent connectivity and autonomous driving.

Byton can count on rich pedigree and strong strategic support. The company is headed by former senior executives from Tesla, Google, and Apple, among others, while the Series B investors include state-owned carmaker Faw Group, lithium battery specialist Contemporary Amperex Technology, and Tus-Holdings, the cleantech-focused operator of Tsinghua University Science Park.

China, the largest EV market globally, is logically a big part of the phase-one plan, especially given recent incentives from the government around emissions reductions and plans to make clean cars account for one-fifth of nationwide sales by 2025. China-branded cars, however, have yet to find a following in foreign markets, a fact that puts Byton’s cross-border marketing agenda under some pressure.

“We’ve chosen to open our first production facility and company headquarters [in China] in order to be closest to our first and biggest target market,” says David Twohig, vice president and chief vehicle engineer at the company. “We’re confident that consumers all over the globe will understand foremost that they are getting a premium vehicle with smart connectivity and self-driving capabilities, and it won’t matter where it was built.”

Brand building efforts are being guided by a “China root, global reach” mantra and a management team culled from across China, Europe, and the US. Twohig served as a chief engineer for Renault in France. Co-founders Daniel Kirchert and Carsten Breitfeld – Infiniti and BMW veterans, respectively – have emphasized that although they intend to maintain a strongly Chinese identify, luxury brands can only succeed if they transcend their home markets.

Some of the first concrete steps in this process were taken last September with the opening of a Chinese factory said to cost about $1.1 billion. An initial batch of prototype models is set to roll out in April 2019 for testing, with a pilot production program starting in the first half of 2019. A promotional roadshow of the company’s first concept car is currently underway in Europe.

To Byton’s credit, internationalization has been a core priority from the beginning. Advanced technology is developed primarily via offices in Silicon Valley and Los Angeles, while vehicle concept and design work is done in Munich. Bases in Beijing, Shanghai, and Hong Kong handle government affairs and media relations.

“Byton is a global company,” says Twohig. “While we started in Nanjing, China, we are focused on going wherever the world’s top automotive and technology talents are.”

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• Topics
• Greater China
• Expansion
• Cleantech
• Industrials
• China
• automobiles
• manufacturing
• Legend Capital
• Growth capital