Xpeng Motors, the Chinese electric vehicle startup, has raised about $500 million in Series C+ funding from investors including Aspex, Coatue, Hillhouse Capital and Sequoia Capital China.

Based in Guangzhou, Xpeng’s other backers include a roster of top Chinese tech companies and investors, including Alibaba Group, Xiaomi, IDG Capital, Morningside Venture Capital, GGV Capital and Primavera Capital.

The company’s last funding announcement before this one was in November, when it said it had closed a $400 million Series C and taken on Xiaomi as a strategic investor.

Chinese EV startup XPeng Motors raises $400 million, takes on Xiaomi as strategic investor

The company didn’t disclose its current post-money valuation, but a source told TechCrunch after its Series C in November that it was “better” than the 25 billion yuan valuation it achieved after its Series B+ round announced in August 2018. Since then, Xpeng has hit two milestones: it released its second smart electric vehicle, the P7 sports sedan, in April 2020, as China was recovering from COVID-19 lockdowns, and in May 2020, secured a production license for its second factory, located in Zhaoqing, Guangdong Province.

The company’s first electric vehicle, the G3 SUV, was launched in December 2018.

Xpeng said last year it eventually plans to hold an initial public offering but wants to build its core business first. Along with other Chinese startups like Nio, Xpeng also competes with Tesla and established automakers like BYD and BAIC group that offer their own electric vehicles.

Tesla is currently suing a Xpeng engineer for allegedly misusing Tesla’s trade secrets. Last month, a United States District Court judge denied one of Tesla’s requests related to the lawsuit’s discovery process. Xpeng said at the time that the ruling “highlights Tesla’s gamemanship and use of discovery as an improper measure to stop with its competitor from competing successfully in the self-driving industry.”

One of Xpeng’s differentiators from some of its rivals is that it builds almost all of its software, and some of its essential hardware, in-house instead of relying on OEMs, including XPILOT, its autonomous driving system; Xmart OS, its in-car operating system; and over-the-air firmware updates.

All electric vehicle makers in China are coping with strong market headwinds. China has the largest electric vehicle market in the world, with more than 400 electric vehicle manufacturers registered in the country. The market grew quickly thanks in large part to government investment and subsidies for buyers, but last year many of those financial incentives were pulled back as Beijing grew concerned about the industry’s rapid expansion.

Along with the COVID-19 pandemic, which forced many Chinese automakers to shut down production earlier this year, this triggered a huge drop in electric vehicle sales (at the same time, sales of traditional cars also fell), leading to speculation that there may be consolidation among rival EV companies.