Flying cars may soon descend on Wall Street.
China's EHang, a maker of autonomous and remote-piloted flying passenger vehicles, has filed for an IPO on the Nasdaq, seeking to break a barrier for its industry.
EHang is unprofitable and its revenue has been declining this year, according to its SEC filing. The move also comes amid a setback for Chinese-manufactured drones, after the Trump administration said on Wednesday that the US Department of the Interior would stop using unmanned vehicles and related technology made in China, citing national security concerns. It wasn't immediately clear whether the department had previously been employing EHang's technology.
Like other so-called flying-car developers such as Germany's Lilium, EHang is positioning its one- and two-seat vehicles as a mobility answer to the traffic congestion that plagues big cities. It also is taking aim at commercial applications like grocery or parcel deliveries.
Last year saw a new high in VC capital raised by drone and aerial makers, which gathered about $460.9 million across 71 deals, according to the PitchBook Platform. Among the bigger venture rounds of late were North Carolina-based PrecisionHawk's $75 million funding in January of last year led by ClearSky and China-based SZ DJI Technology's $75 million deal in 2015 from Accel and other investors.
If its IPO is completed, EHang would become the first VC-backed flying passenger-vehicle startup to go public, according to PitchBook data.
Led by software engineer Huazhi Hu, EHang has raised more than $95 million in venture capital since it was founded in 2014, according to its filing, which lists GGV Capital and Zhen Partners as top shareholders with stakes of 10.8% and 7.6%, respectively. EHang is also developing unmanned drones for industrial uses.
The startup currently does flight testing under the supervision of China's aviation authorities and has delivered 38 passenger-grade autonomous aerial vehicles for testing and training.
EHang's losses have been growing as its sales are falling. It lost about 37.6 million Chinese yuan (around $5.3 million) in the first six months of the year, up from a loss of 26.5 million yuan in 1H 2018, according to its filing. The company's revenue doubled in 2018 to around 66 million yuan from the previous year. Through June 30, revenue dropped to 32.4 million yuan compared with 38.4 million yuan in 1H 2018.
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