MaHui Member KH Automotive Technologies Co., Ltd. Raises Over 300 Million Yuan in Series C; Source Code Capital Co-Led Series B

36Kr has learned that KH Automotive Technologies Co., Ltd. (hereinafter referred to as "KH Automotive") recently completed a Series C equity financing round exceeding RMB 300 million. This round was co-led by CMB International and SDIC Meridian, with follow-on investments from CGN Capital, Lune Energy Jia Shi (under Harvest Global Investments), Suikai Investment, and ChenDao Fund, among other notable institutions.

Previously, in November 2022, KH Automotive completed a Series B round co-led by Source Code Capital, China Reform Fund, CRRC Capital, and Shenzhen Capital Group. Including this Series C round, KH Automotive has completed four financing rounds in total, raising nearly RMB 1 billion. The proceeds from this round will primarily fund capital expenditures for additional production capacity — including factory facilities and equipment — as well as supporting working capital.

KH Automotive was co-founded by Guo Konghui, one of the first academicians of the Chinese Academy of Engineering and the first academician from the automotive industry, along with Guo Chuan. The company established its headquarters in Huzhou, Zhejiang Province in 2018.

KH Automotive is the first domestic supplier of front-loaded air suspension systems for passenger vehicles. Air suspension represents an "advanced evolution" of conventional automotive suspension. By adjusting air pressure to control air spring height and stiffness, it alters the vehicle's suspension characteristics. Compared to traditional suspension, it better filters out road irregularities and enables vehicle body height adjustment. However, due to its complex structure and higher cost, it was previously only available on select high-end models.

Passenger vehicle air suspension systems comprise several key sub-components: air spring assemblies, air supply units, controllers, and sensors. KH Automotive primarily provides system-level solutions and assemblies, as well as products including air spring assemblies and controllers.

KH Automotive's predecessor, "Changchun Konghui," had been conducting R&D in chassis dynamic mechanics for many years. As early as 2010, it began providing forward-looking development services for electronically controlled suspension systems to several OEMs, and started exploring industrialization in 2015. This accumulated technical expertise positioned the company to capitalize on the rise of domestic new energy vehicle manufacturers.

Over the past two years, as Chinese automotive brands have broken through in electrification and intelligentization, domestic demand for air suspension systems has emerged. KH Automotive and other domestic suppliers have begun to see opportunities for industrial-scale deployment.

In June 2021, KH Automotive's air suspension system debuted on Voyah's Free model, making it the first domestic supplier to achieve mass production. Shortly after, the company secured an air spring order from Li Auto. With the strong sales of Li Auto's flagship models L9 and L7 — both equipped with air suspension — KH Automotive rapidly scaled up its volume.

Securing orders from leading new forces in car manufacturing translated into substantial business growth for KH Automotive. According to the company, its cumulative production of air spring assemblies has exceeded 230,000 units, with over 140,000 units shipped in the first eight months of this year alone. Industry rankings show its market share has surpassed 40%, placing it first in the domestic air suspension market.

More orders are already in the pipeline. The company reports it has received letters of intent from 14 mainstream OEMs covering over 30 vehicle models. Beyond Li Auto, Voyah, and ZEEKR, several additional mass-production models will roll out in the second half of this year, involving brands including Lynk & Co, Chery Automobile, BYD, Geely Auto's London EV Company, AVATR, and Changan Automobile.

As order volumes continue to expand, KH Automotive plans to add more factories and production lines. The company's current annual production capacity stands at approximately 700,000 units, with plans to establish new production lines in Suzhou, Chongqing, and other locations.

The domestic air suspension supply chain is steadily rising. KH Automotive and a growing cohort of domestic suppliers have entered this sector, targeting various sub-components and system segments. Guo Chuan notes that domestic suppliers may still have some gaps in product hardware and manufacturing processes during this initial phase, but these shortcomings will be addressed as the market develops. "Only when the market needs your product can you continuously improve and grow."

By: Suping Peng Editor: Qin Li Source: 36Kr (ID: wow36kr)