China, which already boasts more than half of all passenger electric vehicle (EV) sales globally, is launching a new initiative to leap ahead of EV rivals like Tesla (TSLA), GM (GM), Nissan, Volkswagen and BMW to become the undisputed king of electric cars. The Chinese government has earmarked the equivalent of tens of billions of dollars in the past decade to develop electric vehicles, including currently constructing at least 20 separate towns focused on EV production, with additional backing from global Asian giants including Alibaba (BABA) and Foxconn.

Below is a list of the EV startups sprouting up in China.

Top 10 Electric Vehicle Startups In Terms of Fundraising

  1. NIO ($4.1 billion)
  2. WM Motor ($2.3 billion)
  3. NEVS ($1.4 billion)
  4. Fisker ($1.4 billion)
  5. Xpeng Motors ($1.3 billion)
  6. Youxia Motors ($1.3 billion)
  7. Singulato Motors ($1.2 billion)
  8. Lucid Motors ($1.1 billion)
  9. Rivian ($0.9 billion)
  10. CHJ Automotive ($0.8 billion)

Source: BloombergNEF

China's Financing Power

China's full-throttle commitment to the burgeoning industry is reflected in its development of 20 EV production hubs, which are "electric-centric" versions of Detroit, the birthplace of the American auto industry. But unlike the privately-financed U.S. industry, China's EV strategy reflects a strong support from the highest levels of the government, according to a detailed report by Bloomberg. President Xi Jinping aims to build China into a manufacturing giant over the next 6 years, and the roughly 500 Chinese companies focused on electric car development could be a key component of that transformation. As such, total government, carmaker, and other investments in the creation of EV centers has reached $30 billion in its latest stage, per the report, on top of $36.5 billion government authorities spent to subsidize EV sales in China since 2009. Financial commitments to the EV hubs are varied, including fixed-asset investments, development costs, private capital and more. With incredible financing power, the Chinese government is easily able to outspend many private U.S. companies which are dependent solely upon their own capital.

What It Means

The massive development project is a typical representation of the Chinese government's authoritative approach to economic guidance. With the approval of Chinese authorities, local officials are able to provide carmakers with incentives including inexpensive land and tax breaks in the hopes of welcoming EV jobs to their municipalities. The goal is to turn many of what the Chinese government refers to as "characteristic small towns," with their cheaper and more plentiful land, into high-tech hubs.

A crucial component of the strategy depends upon ancillary industries as well. "The industry chain is far more comprehensive than car manufacturing," said Chinese development firm Country Garden Holdings Co. overseer Liu Wei, per Bloomberg. "We're well aware the [EV] fever will fade, but some emerging firms will grow."

China's 500 or so electric car companies compete with global leaders like Tesla, BMW, Nissan, Chevrolet, Ford (F), Volkswagen and Kia, according to EnergySage. Toyota (TM) manufactures the Prius hybrid but does not offer a full electric car.

What's Next

With the tremendous growth in China's EV industry, fueled in large part by the Chinese government itself, Chinese authorities are taking steps to head off the possibility of a bubble collapse that could cause a rash of young companies go out of business, according to another Bloomberg story. Several experts forecast the electric car bubble will burst over the short term, even though China's EV industry will still thrive long-term.