Tesla Suddenly Has A Huge New Competitor

Chinese company LeEco debuted its all-electric car concept on Wednesday.

04/20/2016 10:55 am ET
Damir Sagolj / Reuters

BEIJING (Reuters) - China's Le Holdings Co Ltd, also known as LeEco and formerly as LeTV, on Wednesday unveiled an all-electric battery concept car whose production version the company hopes will compete head-on with Tesla Motors Inc's Model S.

The concept car, called LeSEE, which hints at a production version of the car LeEco is widely expected to launch in the future, is one of an array of similarly positioned premium electric vehicles (EVs) due to hit the market in the next few years from more than half a dozen Chinese-funded EV start-ups. 

LeEco said the concept car, which will be displayed at next week's Beijing auto show, is not only fully electrically propelled but has been engineered to be a "smart", "connected" and "automated self-driving" car.

Jia Yueting, co-founder and head of LeEco, said he hopes that when the car hits the market it will help China's auto industry reach the forefront of the global auto sector.

"When everyone is questioning us over our ability to develop a car like this and is laughing at us, we are still able to be here and show you this car ... I am so emotional," Jia said at a LeEco launch event for several products in Beijing on Wednesday.

Jia said LeEco is also developing a car-sharing business in connection with its green car efforts.

He said one day LeEco cars would be offered free of charge to consumers because the company aims to make money on content and other services it sells through those connected cars. Jia did not say when that day might come.

"Our cars' pricing model will be similar to pricing models for cellphones and tv sets we sell today," he said. "One day our cars will be free ... We are getting there some day."

LeEco's electric vehicle unit and other EV startups in China proliferated after the government, looking to fuel a more determined switch to electricity as the ultimate alternative to petrol, liberalized and opened its automotive industry to allow deep-pocketed tech firms to invest as long as they dabble in electric cars.

Aside from LeEco, the likes of Baidu Inc, Alibaba Group Holding Ltd, Xiaomi Inc, Tencent Holdings Ltd and other tech firms have funded more than half a dozen EV start-ups, which include NextEV and CH-Auto.

Those new players have been emboldened by the government's all-out support for all types of electric cars, which includes generous incentives to buyers.

They also expect industry policymakers to mandate providers of public transportation such as bus companies, taxi operators and even courier services to purchase electric vehicles and invest in charging infrastructure to usher in an electric future.

(Reporting by Norihiko Shirouzu, editing by David Evans)

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