- Alibaba-backed Xpeng announced Tuesday it secured a credit line of 12.8 billion yuan ($1.98 billion) from major Chinese financial institutions — including three of the “big five” state-owned banks: Bank of China, China Construction Bank and Agricultural Bank of China.
- These massive state-owned banks also lend to Nio and Tesla.
- Xpeng said the new credit line will help it expand its manufacturing, sales and services and other operations.
BEIJING — China’s state-owned banks are stepping up their support for some electric car companies in the country.
Alibaba-backed Xpeng announced Tuesday it secured a credit line of 12.8 billion yuan ($1.98 billion) from major Chinese financial institutions — including three of the “big five” state-owned banks: Bank of China, China Construction Bank and Agricultural Bank of China.
Two of the same banks participated directly or indirectly in an agreement to lend up to 11.25 billion yuan to Tesla in late 2019 for the development of its factory in Shanghai, according to a filing with the U.S. Securities and Exchange Commission.
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In July 2020, local branches for four of the “big five” banks extended 10.4 billion yuan in credit to Nio for the start-up’s China operations based in the city of Hefei near Shanghai. Participants in this deal included China Construction Bank, Industrial and Commercial Bank of China, Bank of China and Agricultural Bank of China, according to an announcement from Nio.
In China’s state-dominated system, the banks prefer to lend to state-owned enterprises. That makes it difficult for privately owned companies to get financing, unless they can convince the state-owned banks of their ability to repay loans.