Hong Kong to power global ambitions of Chinese mainland’s electric vehicle brand Neta

JUNE 5: The demand for electric vehicles (EVs) has surged globally in recent years, driven by increased availability and affordability of models, alongside rising public awareness of the need to reduce reliance on fossil-fuel-powered vehicles to mitigate carbon emissions and combat global warming.

“Previously, concerns centered around the driving range of EVs and the convenience of charging,” says Zhang Qi, executive vice-president of Hozon Auto’s Intelligent Vehicle division and assistant CEO of its affiliated brand, Neta Auto.

“But these issues have been largely resolved in recent years, thanks to technological advancements and infrastructure enhancements. Additionally, the overall cost of owning an EV, including maintenance, is much lower compared to fossil-fuel vehicles.”

In 2022, over 10 million EVs were sold worldwide, accounting for 14 percent of all car sales, as reported by the International Energy Agency. The agency also noted that more than 2.3 million electric cars were sold in the first quarter of that year, with estimates suggesting up to 14 million EVs would be sold by year’s end.

China has emerged as the world leader in EV production, responsible for more than half of all sales in 2022, with its market share expected to continue growing. Shanghai-based Hozon Auto is keen to capitalize on this growth market.

After spending the last decade establishing itself as a key player in China’s new energy vehicle sector, Hozon Auto now aims to become one of the top global EV manufacturers through sales of Neta Auto’s flagship models. “In the next 10 years, our goal is to transform from being China’s Hozon to the world’s Neta,” Zhang says.

The name Neta is inspired by Nezha, a protective deity in Chinese mythology. To achieve its global ambitions, the company has chosen Hong Kong as its launch pad due to its reputation as a regional business hub. “Hong Kong will be a crucial anchor point for Neta’s international expansion,” Zhang says.

Neta Auto is among the 45 strategic partners of the Office for Attracting Strategic Enterprises (Oases), a Hong Kong government initiative established in late 2022 to attract mainland and foreign companies in high-tech and high-value industries to set up offices in the city for regional and international growth.

Oases offers tailored plans to help target enterprises launch operations in Hong Kong, providing special facilitation measures related to land, tax, and financing. It also assists companies’ staff and their families in settling in the city.

Zhang highlights that Oases has been instrumental in connecting the company with key stakeholders and providing essential information and guidance on relevant Hong Kong government policies. “Thanks to Oases, we have direct access to the latest policies of the Hong Kong government, including innovation and technology development, new industrialisation measures, and various public funding projects,” he says.

In his Policy Address last year, Chief Executive John Lee announced a HK$10 billion (US$1.3 billion) New Industrialisation Acceleration Scheme to support enterprises in advanced manufacturing, new energy technology, AI, data science, and life and health technology. This funding is beneficial for companies like Neta Auto.

Oases has also been crucial in helping Neta Auto connect with various business partners. “The automotive industry chain is extensive, covering both hardware and software, from chips to cloud computing,” Zhang says. “There is a significant need for partnerships. Oases’ platform is excellent for connecting these resources, sparking ideas, and fostering collaboration on products.”

Founded in 2014, Neta Auto focuses on producing intelligent new energy vehicles and has experienced impressive growth. In 2022, it became the first Chinese EV start-up to sell over 150,000 vehicles in a year, with over 3,000 delivered overseas.

Its entry-level Neta V, with a range of 301km (185 miles), is priced at 73,900 yuan (US$10,230) in mainland China. Last year, it launched four additional models priced between 100,000 yuan and 230,000 yuan. Some models are popular for their spacious interiors, while others attract buyers with intelligent features or sporty designs.

The company’s success is attributed not only to affordable pricing but also to a strong focus on customer experience. This year, Neta introduced its latest model, the Neta L, equipped with features such as an intelligent cockpit, autonomous driving, Lidar sensors, a fridge, television, and zero-gravity seats.

The company has also achieved significant technological breakthroughs. “The energy density of our lithium batteries has increased from about 100 watt-hours per kg 10 years ago to nearly 300 watt-hours per kg now,” Zhang says. “This threefold improvement means the driving range can be doubled or tripled at the same weight.”

As part of its expansion plans, Hozon Auto signed a memorandum of understanding last September to establish its international headquarters at Hong Kong Science Park. The company will invest billions of yuan over five years to build a smart R&D center and a big data center in the city, employing hundreds of staff.

“Our Hong Kong R&D center will develop customized and innovative EVs for various markets, leveraging successful models from mainland China,” Zhang says. “It will also benefit from Hong Kong’s strengths in AI to develop original modules or algorithms for our global vehicle platform.”

The influx of world-class innovation and technology companies setting up offices in Hong Kong underscores the city’s role as a business gateway for tech companies expanding in Asia and beyond. Last year, Hong Kong welcomed 382 companies from 45 economies, including 82 in the I&T sector, as reported by InvestHK.

Neta’s EVs are already entering Southeast Asian markets, with manufacturing plants in Thailand and Indonesia expected to start mass production this year, delivering up to 30,000 vehicles annually. Another factory in Malaysia is set to begin production next January.

The response from customers in these Asian markets has been positive, with the Neta V topping EV sales in Thailand last June, selling over 2,000 units. Neta’s vehicles are now available in 13 countries, with more than 20,000 EVs sold overseas last year. The company aims to increase this number to 100,000 and expand sales to 60 countries, with plans for more manufacturing plants in the Middle East, Europe, and the Americas.

“I am confident that with Hong Kong’s advantageous resources and the technology we have developed in the mainland Chinese market, we can elevate the entire enterprise,” Zhang says. “Through our EV sales, we also hope to promote a low-carbon lifestyle and contribute to environmental protection.”

(Source : www.scmp.com)