A Unicorn Car Maker in Wuhan

Voyah Auto, a unicorn car maker in Wuhan, has secured nearly 5 billion yuan of financing and reached a post-investment valuation of 30 billion yuan.

On November 17th, Voyah Auto announced the signing and delivery of the A-round financing agreement.

In this round of financing, Voyah Auto attracted 10 investors, including state-owned enterprises with strategic cooperation and large state-owned financial institutions as lead investors, as well as state-owned capital, local state-owned capital, and private capital as follow-on investors.

Among them, Dongfeng Group invested 900 million yuan. After this round of financing, Dongfeng Group’s stake in Voyah Auto was 78.88%, the A-round investors were 12.37%, and the staff equity platform held 8.75%.

Despite the unfavorable financing environment, Voyah Auto obtained a substantial amount of financing and broke the record for the largest first-round financing in China’s new energy vehicle industry. This reflects the confidence of the capital market in Voyah Auto to some extent.

Why Does Voyah Auto Win Capital’s Favor?

Affected by the international situation and frequent epidemics, the capital market has been sluggish, especially the new energy market, which had been performing better than expected.

Recently, WeRide, known as “the grassroots” in the industry, has suffered setbacks in the U.S. stock market, and the performance of its HK stock market debut was also below expectations. Even Linglong’s stock price, which had just been listed on the HK stock market, hovered around 20 yuan, far from the issuance price of 48 yuan.

In the face of an uncertain future, capital has become increasingly cautious about its investment targets.

Unlike most “grassroots” new energy vehicle companies, Voyah Auto is directly supported by Dongfeng Group.

As one of the three major SOEs in the automotive industry, Dongfeng Group has a 53-year development history. It can not only provide Voyah Auto with advanced technical support but also provide certain financial backing.

As a new brand for Dongfeng Group’s transformation into an intelligent and electrically powered vehicle company, Voyah Auto has taken on an important mission for Dongfeng’s development in the new era. This special identity has also attracted the attention of many capital investors.

According to Shen Jun, the CFO of Voyah Automotive, since December 2021, Voyah has officially launched A-round financing, and the project has attracted investment attention from more than 100 market-oriented investment institutions.

This largely proves that the identity of Voyah’s young master has been recognized by many investment institutions.

Indeed, this is the case.

The leading investor, State-owned Enterprises Mixed Ownership Reform Fund, said:

“Voyah Automotive is a high-end new energy vehicle brand for Dongfeng Group’s electrification and intelligent transformation, a key project of state-owned enterprise mixed ownership reform, and a practitioner of the country’s ‘dual carbon’ strategy.

We profoundly understand and practice the goals of the ‘dual carbon’ strategy and participate in Voyah Automotive’s mixed reform financing through equity investment, deepening our layout in state-owned new energy vehicle independent brands, and assisting the strategic transformation of state-owned automobile brands.”

In addition to the support of the state-owned team, the most noteworthy aspect of this round of financing is the industrial investment party that has formed strategic synergy with Voyah.

Among them, Ganfeng Lithium is a dual-listed company on the Shenzhen Stock Exchange and the Hong Kong Stock Exchange. Its business covers important links in the value chain from upstream lithium resource development, midstream lithium salt deep processing and lithium metal smelting to downstream lithium battery manufacturing and comprehensive recycling and utilization of waste batteries. It plays a pivotal role in the power battery industry chain.

At the same time, Ganfeng Lithium’s lithium mining resources are distributed in many countries and regions around the world, and it has industrialized technologies for “brine extraction lithium”, “ore extraction lithium”, and “recycling extraction lithium”.

Xinwanda entered the power battery field in 2008 and developed rapidly. It has now entered the top ten in terms of installation volume. At the beginning of this year, Xinwanda’s capital increase appeared as a shadow of many car companies and affiliated companies such as NIO, Ideal, XPeng, SAIC, and Guangzhou Automobile. The outside world believes that Xinwanda’s installed capacity will further increase.

The support of these two private enterprises helped Voyah to fill in the gaps in the battery supply chain map and solve the problems of high battery costs and insufficient supply caused by the rising prices of lithium battery raw materials.

From Voyah’s perspective, including more market-driven shareholders will fundamentally eliminate the drawbacks of weak vitality of traditional state-owned enterprises and drive Dongfeng Group to achieve the expected results in the new development pattern of intelligent automobiles, which is Voyah’s responsibility that cannot be shirked.

To achieve this goal, Voyah has also elevated technological research and development to an unprecedented level.

Voyah: investing ¥2 billion in technology research and development

“Over 40% of the expenses in this round of financing will be used for technological research and development,” said Shen Jun. This means that Voyah will invest ¥2 billion in technological research and development in the future.

It is understood that ESSA’s native intelligent electric architecture and the central centralized SOA electronic and electrical architecture represent the future of Voyah’s technological route, and Voyah will continue to invest in this field.

Among them, ESSA’s native intelligent electric architecture can provide strong performance for vehicles, while the central centralized SOA electronic and electrical architecture is like an advanced intelligent neural system, governing the vehicle’s intelligent system.

“Chasing the Light” is Voyah’s first sedan model, and it is the first model equipped with intelligent electric biomimetic architecture (ESSA+SOA). Currently, Voyah’s Chasing the Light has completed rigorous high-temperature and high-altitude summer standard tests and is expected to debut in December.

According to Voyah, the centralized SOA architecture used by Chasing the Light is the only intelligent architecture that uses centralized hardware. It is the first in the industry to integrate the entire vehicle’s power, intelligent driving, vehicle control, and intelligent cockpit into one controller architecture. It can meet the technological needs of the next five years.

Previously, Voyah’s CTO Wang Junjun stated in a media interview:

“The overall trend of the development of automobile electronic and electrical architecture is evolving from distribution to centralized integration. The advantages of centralization are numerous, including shorter wiring harnesses, significantly fewer ECU components, lighter vehicles, stable and efficient signal transmission, and more. This will help maximize the utilization of intelligent vehicles and facilitate the handling of complex tasks.”

In addition, Voyah will also increase investment in autonomous driving, energy, and other fields.

According to Voyah’s CEO Lu Fang, Voyah has completed research and testing on the 800V high-voltage fast charging technology and is actively promoting the research and development of full solid-state batteries. In terms of hydrogen fuel cells, Voyah will absorb the research and development results of Dongfeng Company and conduct secondary development and matching with Voyah’s own models, and will launch them at an appropriate time in the future.“`

With a strong independent research and development capability since its inception, Voyah is different from many industry insiders who think Voyah relies on Dongfeng Group.

According to the official information provided by Voyah, as of now, the R&D personnel of Voyah automobile accounted for 38% of the total personnel in the technology company, and the personnel in the core R&D area increased by 73% compared with October 2021. The average age of the team is 32.6 years old, and the ratio of Master of Science or above is 38%.

From 2020 to the present, Voyah has accumulated 1771 patent applications within less than three years, including 1450 invention patents, and the average number of patent applications per year was nearly 600, and Voyah’s patent growth rate is the first in the new energy industry.

Voyah’s development has always been inseparable from the support of Dongfeng, and the continuous empowerment of the parent company. Voyah is an independent company under Dongfeng Group. Voyah insists on the path of independent and self-developed road and is a company with a complete value chain of research, production, sales, and supply. With the support of Dongfeng Group, Voyah will definitely move towards a healthy and independent development path.

With the explanation of Lu Fang, standing on the shoulders of Dongfeng Group, opening up its own development pattern, and Voyah’s doubts have been dispelled by many people.

When technology lands become products, Voyah has completed a strategic layout covering three major categories of SUVs, MPVs, and cars within three years.

It is understood that Voyah will maintain the strategic layout of launching a new car every year to meet the differentiated needs of users in more segmented markets.

It can be said that there is not only Dongfeng Group’s technical support but also the unremitting efforts of Voyah people.

Integration of “Research, Production, Sales, and Supply”, Voyah “Waiting for Blossom”

With both support from Dongfeng Group and good technical strength, why is Voyah so questioned in the financing process?

According to Voyah’s latest sales data, in October of this year, Voyah delivered a total of 2,553 new cars, an increase of 154% year-on-year. However, compared with many new brands that measure sales performance in units of tens of thousands, Voyah’s performance is not outstanding.

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The underperformance that falls short of industry insiders’ expectations is the main reason for questioning.

Moreover, compared to the status of “Wei Xiaoli,” an industry star that can attract industry attention with a slight move, “Inarticulate” is also in a relatively passive position in the public opinion environment.

As a result, how to win the “public opinion battle” and how to turn technological advantages into market advantages have become the most important issues faced by LanTu.

LanTu gradually found its own rhythm.

Since the management team was adjusted in the middle of this year, LanTu has begun to explore creating communication highlights.

Unlike the previous state of “greed for perfection” that did not prioritize the technological advantages, this time, LanTu takes safety and architecture as the main communication highlights.

From the release of the ESSA+SOA intelligent electric biomimetic body two days ago, it should be quite a highlight for LanTu to first apply this architecture.

Before this, LanTu Dreamer had completed an active and passive safety challenge in Changsha. LanTu Dreamer successfully achieved the first high-speed rear-end collision test 90km/h beyond US standards and complex scenario AEB+ESA tests, eliminating the stereotype that many consumers have of poor safety of MPV models.

Although both the architecture of the electric biomimetic body and the collision test that incorporates safety into the bone marrow are less eye-catching than fancier autonomous driving functions, larger computing power, and more laser radars, more reliable products like these are the travel protection that more consumers need.

From the market structure, with the development of intelligent electric vehicles to the present, the head consumers who are willing to try have been exhausted, which is also the main reason why “Wei Xiaoli” cannot continue to maintain high-speed growth.

More after the novelty is plain. In the matter of purchasing a car, what more consumers care about is safety and experience. In the rational market, there will be more opportunities for steady enterprises like LanTu.

How to seize this opportunity, establish its own safe and reliable reputation, and quickly increase its market share is what LanTu should contemplate and adhere to.

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After all, sales volume is an important standard to measure the health of a car company. Quickly increasing market share and achieving a turnaround in profit is more direct than any financing plan.

With a beautiful report card to promote the IPO plan, it can not only avoid the embarrassment of breaking through the market but also dispel doubts about “raising money”. This reason has been proved in Guangzhou Automobile E-Auto.

Before this round of financing in Voyah, Guangzhou Automobile E-Auto had completed its first financing of a total of 18.294 billion yuan, releasing 17.72% of its shares, and its valuation had also exceeded 100 billion.

Although Voyah and E-Auto are not in the same track, the strong market performance of E-Auto, which has been supported by substantial funds, can give some enlightenment to Voyah. Increasing sales volume is the main way to enhance market recognition.

Voyah understands this reason. In order to enable more consumers to enjoy a more convenient car life, Voyah has already opened 168 stores nationwide, covering 85 cities throughout China.

Of course, this sales network is only half the level of “Weixiaoli”. The task of improving the sales network and then improving the market performance is also urgent.

The market that is gradually returning to rationality has already handed over the opportunity to Voyah, which is practical. How will Voyah seize such an opportunity? We wait and see.

This article is a translation by ChatGPT of a Chinese report from 42HOW. If you have any questions about it, please email bd@42how.com.