ECOtality Establishes Joint Venture to Manufacture and Distribute Electric Vehicle Charging Systems in China
ECOtality, Inc. has signed a letter of intent to enter into a joint venture with Shenzhen Goch Investment, Ltd. that will provide US$15 million to establish manufacturing and distribution operations for electric vehicle (EV) charging systems in China.
To support the Company’s anticipated expansion, ECOtality received a combined US$2.5 million direct investment from Shenzhen Goch and existing ECOtality institutional shareholders.
Shenzhen Goch Investment is a strong strategic partner that provides the knowledge and financial resources for ECOtality to successfully enter into the largest potential market for EVs and their supporting infrastructure—China. As we prepare for the commercial launch of grid-connected vehicles, the direct investment and joint venture with Shenzhen Goch Investment allows us to strengthen and expand our US operations by internationally extending the reach of our technology leadership.—Jonathan Read, president and CEO, ECOtality
A recent industry report by Pike Research projected that by 2015 the global market for electric vehicle charging equipment will become a $1.9 billion annual industry, in which China is expected to be the world leader in charging station installations with 47.8% of annual sales.
ECOtality has worked on North American electric vehicle initiatives since the 1990S and has exclusive rights to the patented Minit-Charger technologies that can fast-charge an EV in 10-15 minutes. (Earlier post.)
Because the battery’s ability to accept maximum charge is a complex variable that varies with use and as the battery ages, Minit-Charger technology features real-time measurement of those parameters so as to identify the battery’s ability to accept change. This input from the battery to the Minit-Charger (via the proprietary BICC or BDC battery modules) is subsequently used to provide real time Minit-Charger output control.
In this way, the battery is not unintentionally over- or undercharged. Other parameters, such as battery temperature, are additional supportive measures to ensure safe maximum charge return but are not the basis of control as found in other fast charger designs.
An added benefit of Minit-Charger technology is that a battery health check is performed at time of vehicle connection to the Minit-Charger. This assures that the conditions of the battery are known prior to initiation of charge.
As electric vehicles are one of the most viable solutions for China’s energy and environmental concerns, we are working with multiple local governments and strategic partners in China to establish a robust charging network that will foster the public adoption of electric vehicles.
This partnership will provide cost-effective charging systems that will enable clean electric transportation in China and globally expand the accessibility of electric vehicle technologies.—Dr. Dongsheng Gong, Founder and Chairman, Shenzhen Goch Investment
In exchange for exclusive sale and distribution rights for ECOtality’s charging stations in China, Shenzhen Goch Investment is investing $10 million into a manufacturing joint venture and $5 million into a sales and distribution joint venture with ECOtality. Of the $2.5 million in capital raised to support ECOtality’s domestic and international expansion, Shenzhen Goch Investment invested $2.0 million and current ECOtality institutional shareholders invested an additional $500,000. Ardour Capital Investments, LLC, acted as an advisor on this transaction.
Shenzhen Goch Investment, headquartered in Shenzhen, China, is an investment holding company that focuses on high-tech, financial services, and commercial property development and operation with the combined asset value exceeding $300 million.
Shenzhen Goch is the owner and operator of the recently established Tianjin Goch Science & Technology Park, where the Tianjin government plans to invest a minimum US$750 million in the 160-acre park to accommodate leading high-tech and clean tech companies.
Shenzhen Goch was founded by Dr. Dongsheng Gong, an entrepreneur and business leader in China. Dr. Gong is the founder and CEO of SVG Financial, a leading financial service firm in China that was funded by leading venture investors including NEA and Cybernaut Growth Fund.