As the market for hybrid and electric vehicles takes off, the latest trends in the market will soon give rise to new needs for electric vehicle translations and supply chain localization, as indicated by an uptick in developments in key overseas markets. Despite recent setbacks in the industry, many Chinese electric vehicle (EV) companies have stepped up the gas to compete with the preeminent EV tech giant of the moment, Tesla. As we covered recently, developments in new technologies (such as cobalt-free batteries) and performance innovation have fueled EV startups to enter the global market and increase profitability. Now, aspiring EV startups are attempting to mimic Tesla’s success, particularly as the traditional car struggles to stay relevant.
In an anticipated move, Chinese EV startup Li Auto successfully debuted on the US stock market in July 2020. With its initial public offering priced at $11.50 a share, it quickly gained momentum and increased to $15.50 per share on opening day (a 35% increase in price). Shares in the first week are trading at $16.58*, up about 44% from the IPO price and a 6.9% increase from initial trades. Already mass-producing its own cars since November 2019, the Beijing- based company is the first EV startup to successfully capitalize on extended-range electric vehicles in China.
Li Auto is the most recent Chinese EV startup to debut on the US stock exchange, however it was not the first. Shanghai-based Nio was the first Chinese EV startup to break the US stock market in 2018. Nio, along with Tesla recently reached all-time highs on the US stock market. Taking advantage of this hype, Li Auto hopes to capitalize on investor interest and drive business within the industry. Similarly, Chinese EV rival Xpeng is preparing to file for its US IPO, raising $400 million US dollars in preparation for its launch. Highlighting this excitement for Chinese EV startups to enter the US stock market, analyst Feng Linyan comments, “the surge of Tesla’s share price has provided a window of opportunity for Chinese EV companies to get listed.”
While there is a lot of optimism for Chinese EV companies entering the space, these startups are also facing many complex challenges due to growing saturation within the EV industry. Jeff Zhang, partner of M&A and Private Equity Group, emphasizes, “EV startups, especially those in China, are facing a more competitive environment now,” and that more EV startups require, “financing to speed up R&D and gain market share.” With this rapid competition, the demand for capital has increased exponentially as companies seek to increase sales that are made only more difficult in the current economic climate.
To thrive at this pivotal juncture for both their industry and the global economy, Deloitte recommends that EV startups should build a ‘recognizable brand’ as a solution to differentiate and to succeed in the international market, adding a depth dimension to the significant work of developing technical content and multilingual electric vehicle translations for their products. As well as regional preferences for specific models and types of vehicles, these efforts will need to account for differing perceptions of electric vehicles country to country, as well as broader consumption trends specific to local markets. In tandem with a robust localization strategy, effective communications solutions will play a vital role not only in delivering their products and documentation in the languages consumers require, but also in cultivating an influential presence for their brands in overseas markets. As the global COVID- 19 pandemic impacts EV capital growth worldwide, it is now more important than ever for EV startups to adopt effective brand positioning as they enter the international market. The ability to influence consumer perception and ensure product quality relies heavily on well translated websites, product launches, advertising and PR releases.
With a global network of expert linguists in 250+ languages, and experience providing services for the automotive industry including EV translations, CSOFT International has the expertise to assist electric vehicle companies capture current market opportunities by providing accurate translation and localization services.
*As of opening time on August 5, 2020