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… increasingly viewed as the next battleground for differentiation in smart driving.
<h3>Barriers Xpeng must overcome in its push for scale</h3>
“The competition in the automotive market in 2026 will be even more brutal,” He said recently during an exchange with industry peers. He noted that every automaker is operating under intense pressure and that, just as few predicted the rapid shifts seen in China’s car market a year ago, uncertainty over the next year remains high.
Leapmotor has publicly stated a goal of selling one million vehicles in 2026, including 900,000 units domestically and 100,000 overseas. Combined with Xpeng’s target of up to 600,000 vehicles, the two companies are seeking to capture a substantial share of the market next year. That growth, however, would need to come largely through displacement rather than overall market expansion.
China’s automotive market has entered a phase of stock competition. For Xpeng and <a href="/company/leapmotor">Leapmotor</a> to sell a combined 1.6 million vehicles in 2026, other manufacturers operating at similar price points would inevitably lose share. Under the current market structure, that pressure is most likely to fall on <a href="/company/byd">BYD</a> and <a href="/company/geely">Geely</a>.
Both BYD and Geely are expected to place greater emphasis on overseas markets in 2026 while defending their positions at home. According to 36Kr, BYD is targeting overseas sales of 1.6 million vehicles next year, with international markets expected to generate the bulk of its profits. Domestically, BYD is likely to maintain a low-margin strategy to sustain competitive pressure. Geely, meanwhile, is expected to concentrate resources on its rivalry with BYD.
For Xpeng and Leapmotor, success will depend on maintaining strong value-for-money while outperforming rivals on selected metrics. Leapmotor is focused on the RMB 100,000–200,000 (USD 14,000–28,000) segment, emphasizing affordability. Xpeng is targeting the RMB 150,000–250,000 (USD 21,000–35,000) range by pushing advanced driver assistance features into lower price brackets. As a result, driving assistance capability and value are converging in the RMB 100,000–250,000 market.
Xpeng is moving quickly into the hybrid space, while Leapmotor is rolling out four major product lines spanning RMB 100,000–300,000 (USD 14,000–42,000). In 2026, Leapmotor plans to launch four to five all-new models, including two D-series vehicles and two A-series models, alongside multiple updates to its B- and C-series lineup.
All of this expansion depends on sustained high growth. Rapid growth, in turn, requires organizational structures, supply chains, and operating systems to scale in parallel.
For newer automakers, annual sales of 500,000 vehicles are widely seen as a systems threshold. Beyond that level, product variations multiply, supply chains grow more complex, and coordination costs rise sharply, increasing the risk of execution errors.
Li Auto was the first among the newer generation of carmakers to approach this milestone. Its subsequent experience has shown how management challenges can be amplified after crossing it. Whether Xpeng and Leapmotor can clear the same hurdle smoothly will be closely watched.
KrASIA Connection features translated and adapted content that was originally published by 36Kr. This <a href="https://36kr.com/p/3636215229170951">article</a> was written by Xiao Man for 36Kr.

Xpeng targets 600,000 deliveries in 2026 as it expands hybrid and AI-driven lineup

Xpeng Motors

East Asia

China

Transportation

Electric Vehicles

Mobility

… consumer tastes, with major producers beginning the rolling out of baijiu with lower alcohol content. Morningstar analyst Song said that while many producers are state-owned and are slow to change, some brands, like Sichuan's Luzhou Laojiao, have done well with light-flavored baijiu.
"Even with whisky growing fast, we think that the category will remain below 5% of overall spirits sales until 2030," she said.
At UK-based IWSR, Research Director Zhu predicted shelf space for made-in-China whisky will become more crowded, and consumers may gravitate toward brands or companies they already know as they start exploring Chinese whiskies.
"Independents will need to be very clear about what makes them different, whether that's terroir-driven production, local ingredients, distinctive maturation process, or a strong local brand identity," said Zhu.
Entertaining visitors at the Longyan distillery tour, ebullient Nine Rivers CEO Robertson remained unfazed and full of ideas.
"We've got lots of things on the side," he said, indicating that the company plans to launch a wide range of products. "We would have the capacity for the big players to do some production here, and a lot of private labels" developed in collaboration with celebrities—a widespread trend in the drinks world, with products from US rapper Jay-Z's Armand de Brignac champagne, jointly owned with LVMH, to Portuguese soccer manager Jose Mourinho's "The Special One" red wine.
Just days back from a trip to the US aiming to negotiate deals, Robertson was busy pitching to potential investors on the distillery tour, calling above the din: "Do you want some more drinks?"
This article first appeared on <a href="https://asia.nikkei.com/spotlight/big-in-asia/in-china-s-whisky-boom-local-distillers-take-aim-at-big-shots">Nikkei Asia</a>. It has been republished here as part of 36Kr’s ongoing partnership with <a href="https://www.rwegrgdf5.eu.org/nikkei-teams-up-with-36kr-in-asia-tech-news-coverage/">Nikkei</a>.

In China's whisky boom, local distillers take aim at big shots

Retail

Consumer Economy

As <a href="/industry/ai">artificial intelligence</a> becomes more deeply embedded in marketing, single-function agents are increasingly proving inadequate for real-world use cases, which tend to be too complex and interconnected for narrowly scoped tools.
That limitation was a recurring theme at the 2026 iFlytek Global AI-Marketing Ecosystem Conference, held on January 15 in Shenzhen. At the event, iFlytek’s AI marketing unit, AIMarX, officially unveiled its SuperAgent application framework, alongside an agentic marketing platform built on top of it.
Data fragmentation remains the central bottleneck preventing AI from scaling in real-world marketing environments, said Ronen Mense, Asia Pacific president and managing director at AppsFlyer. He described the issue as a structural challenge facing the industry rather than a purely technical one.
As marketing touchpoints continue to multiply, even large brands struggle to integrate data collected across disparate platforms in a meaningful way. The result is that many AI applications remain confined to isolated, single-point optimizations rather than end-to-end decision-making. According to Mense, marketing teams are more exposed than most other business functions to weak data foundations. Data must comply with privacy regulations while simultaneously supporting real-time decisions, he said, a dual constraint that makes it difficult for companies to build trusted and unified data infrastructure.
These pressures are amplified in global marketing operations. “The complexity of global marketing is rising exponentially due to diverse market hierarchies, stark cultural differences, and highly dispersed touchpoints,” said Wang Yunxia, vice president of iFlytek’s AI marketing business group and general manager of its marketing solutions division. “These are problems that can no longer be solved by simply adding more human labor.”
“AI is evolving from a function into foundational infrastructure,” said Yu Jidong, iFlytek’s senior vice president and president of its consumer business group. This transition, he added, calls for a more pragmatic approach to technology, arguing that only solutions tied directly to real business pain points can drive meaningful change across the industry.
Discussions throughout the conference pointed to a growing consensus that isolated technological advances are no longer sufficient to address systemic challenges. What is needed, participants suggested, is reconstruction at the ecosystem level.
That process begins with how teams work together. Traditional marketing organizations are typically siloed, with data analysis, creative development, and media buying operating largely in parallel. Intelligent marketing, by contrast, requires cross-functional and tightly integrated workflows. “Optimizers can quickly pinpoint strategy issues, while creative teams can immediately see which assets are performing well,” Wang said. “This unified perspective is fundamentally reshaping traditional collaboration models.”
A deeper shift is also underway in how marketing value is measured. According to 36Kr, 62% of users no longer click on traditional links after receiving AI-generated answers. If accurate, this trend reduces the usefulness of metrics such as clickthrough and conversion rates, which may no longer fully reflect marketing effectiveness. The implication is that the industry may need new measurement frameworks capable of capturing longer-term trust and value-based relationships between brands and consumers.
Li Ping, vice president at iFlytek and president of its AI marketing business group, expressed confidence in the company’s positioning. He said SuperAgent is intended to help marketing relationships evolve from a traditional B2C model to a B2A2C (brand-to-agent-to-consumer) structure, linking brands to consumers through AI agents. Under this framework, AI is positioned not only as a productivity tool, but as an intermediary that reshapes how brands and consumers interact.
KrASIA Connection features translated and adapted content that was originally published by 36Kr. This <a href="https://36kr.com/p/3642948995862405">article</a> was written by Ou Xue for 36Kr.

iFlytek’s SuperAgent aims to make AI the new marketing infrastructure

iFlytek

Artificial Intelligence

Deep Tech

… recommendation slot will be formally opened to advertisers.
Another subtle but meaningful shift involves commerce. A platform long known for favoring outbound traffic is now embracing closed-loop transactions.
“In the past, we guided users to external apps, but that also meant losing users,” Li said. Bilibili has built an internal commerce loop based on mini-programs, allowing transactions to be completed without leaving the platform. Compared with outbound links, closed-loop conversions improved cost efficiency by ten basis points, while overall transaction efficiency rose 150% year on year.
Bilibili remains one of the few major platforms to consistently support an open-loop strategy, with advertising partnerships spanning Taobao, <a href="/company/jd">JD.com</a>, and <a href="/company/pinduoduo">Pinduoduo</a>. But as more transactions move on-platform, that long-held neutrality may gradually shift.
<h3>Monetizing mindshare among young consumers</h3>
For years, mid- and long-form video platforms have struggled to match short video rivals in advertising scale. Bilibili once pushed hard into vertical video, but its differentiation remains rooted in longer content.
“In an era where people swipe every three seconds, Bilibili continues to invest in mid- and long-form video,” Lai said. “Good content is what builds brand image and consumer mindshare. That kind of trust can’t be formed by a few short clips or static images.”
Compared with platforms like <a href="/company/douyin">Douyin</a>, <a href="/company/kuaishou">Kuaishou</a>, WeChat Channels, and <a href="/company/xiaohongshu">Xiaohongshu</a>, Bilibili’s emphasis on what it calls deep mindshare has often sounded understated.
Li Ni framed it differently at Ad Talk. “The brands people trust when they are young often stay with them for life,” she said. “That influence ultimately delivers better results and better transactions.”
During the 2025 Singles’ Day shopping festival, Bilibili posted an average new customer rate of 55% across industries. Gross merchandise value for products priced above RMB 1,000 (USD 140) rose 63% year-on-year.
As users move from campus life into the workforce, their spending power is rising and their resistance to advertising is easing. The consumer mindshare cultivated years earlier is now ready to be monetized.
Platform data shows that in 2025, 24% of videos on Bilibili’s weekly “must-watch” charts were branded collaborations between companies and creators. The rankings are entirely user-voted.
Looking ahead, Bilibili’s mid- and long-form ecosystem still depends on a steady supply of professional content. According to 36Kr, the platform is planning seven gala events, 40 domestically produced animation titles, six music initiatives, three brand-led projects, 113 documentaries, and multiple podcast programs in 2026.
Since launching its video podcast initiative in 2025, Bilibili’s video podcast audience has surpassed 67 million. A growing roster of public figures, journalists, opinion leaders, and creators have joined as hosts. The platform has also introduced a support program to bring traditional radio hosts onto Bilibili, encouraging them to produce video podcasts and music radio content.
Bilibili believes this semi-professional, personality-driven format offers significant room for brand integrations and could become one of its most commercially flexible content pillars yet.
KrASIA Connection features translated and adapted content that was originally published by 36Kr. This <a href="https://36kr.com/p/3640520932560006">article</a> was written by Wang Yuchan for 36Kr.

Bilibili rolls out AI tools to push next phase of platform monetization

Bilibili

Entertainment

Short Video

Live Streaming

Video

Creative

Content

Creator Economy

Hong Kong's stock market had a banner year for IPOs. The city's stock exchange has become the top fundraising destination in Asia in 2025, and second in the world. Hundreds more share flotations are waiting in the pipeline, boosting the outlook for the beginning of 2026.
Investor enthusiasm for China's homegrown companies is expected to lead the bull run. The first trading day of 2026 saw chipmaker <a title="" href="https://asia.nikkei.com/business/markets/ipo/chinese-ai-chipmaker-biren-soars-on-trading-debut" target="_blank" rel="noopener">Biren Technology</a> surge as much as 100% on its debut. High-profile Chinese <a href="/industry/ai">artificial intelligence</a> startups Z.ai (Zhipu AI) and <a href="/company/minimax">MiniMax</a> followed suit the following week.
But questions are being raised about IPOs by companies with weaker credentials, and some companies that have listed recently in Hong Kong have seen their shares run out of steam.
There were 99 new stock listings on the Hong Kong Exchange main board last year, with a total valuation of USD 35 billion as of December 19, 2025, according to data from Dealogic, placing the city second in the world for new listing value, behind Nasdaq's USD 52.3 billion. That is a jump of more than 200% in value compared with all of 2024.
The Asian financial hub's bourse saw a rush of listings before year's end. Seven companies waited in line to list in the week before the exchange closed for Christmas. Another six sounded the exchange's gong, a ritual for market debutants, on December 30.
"Buoyed by this momentum and a backlog of potential <a title="" href="/industry/ipo" target="_blank" rel="noopener">IPO</a> candidates, we expect this upward trend to continue into 2026," said Paul Law, a KPMG partner in China. "In particular, the pace of AI-related listings is poised to accelerate as the technology matures and is adopted more widely across various industries."
In recent months, however, Hong Kong’s red-hot stock market has cooled. Since November 2025, more debutants have fallen on their first day of trading, with some remaining below their listing prices. Autonomous driving company CiDi slid more than 13% on December 19, its first day of trading. Jingdong Industrials, a unit of <a href="/company/jd">JD.com</a> focused on supply chain technology, has largely traded below its listing price since going public on December 11.
The lackluster performance among recent listings comes as regulators voice concern over what they see as the declining quality of IPO applications and a lack of due diligence.
Special listing regimes designed for technology companies that have yet to turn a profit have drawn a record number of applications. Transthera Sciences, a clinical-stage biotech company listed under a regime for biotech and pharmaceutical companies, soared more than 50 times versus its IPO price, sparking fears of overvaluation.
The Southbound Stock Connect program, which allows mainland investors to invest in the Hong Kong stock market, has seen average daily trading volume drop 19.4% in November 2025 compared with the previous month. Capital from mainland investors was a key driver of Hong Kong's benchmark Hang Seng Index this year. In December 2025, the Hang Seng Index fell 0.9%, and is down 6.1% from its October high.
The Hong Kong exchange mounted a major comeback in 2025. Previously, capital market activity had stalled following China's tech crackdown in 2020 and the real estate crisis the following year. In 2025, by contrast, asset managers and hedge funds were increasingly visible in new listings, participating as cornerstone investors.
A July 2025 report from Goldman Sachs pointed out cornerstone investors' subscriptions "have accounted for 42% of the total capital raised, with approximately two-thirds from foreign investors and one-third from domestic investors."
Meanwhile, the market received a big boost from one type of listing: More than half of the listing value had been driven by "A-to-H listings," in which companies listed in mainland China seek a secondary listing in Hong Kong.
Excluding such secondary listings, 78 companies raised a total USD 15.5 billion, compared with Nasdaq's USD 51.3 billion and the New York Stock Exchange's USD 25 billion, according to Dealogic data.
As of December 7, 2025, active applications for IPOs reached a record 316 in Hong Kong, 92 of which were A-to-H listing applications, according to KPMG. The company expects more than 100 A-to-H listing applications in the near future, potentially offering a robust start to 2026.
The listing process for such deals is simpler than first-time public offerings in terms of filing requirements and documentation. The city's securities watchdogs, the Securities and Futures Commission and the Hong Kong exchange, have devised a fast-track system for A-to-H listings in which screening takes no more than 30 business days. To qualify for this streamlined system, companies must have a market capitalization of at least HKD 10 billion (USD 1.3 billion), according to the exchange.
Beijing has been encouraging companies looking to list overseas to prioritize the Hong Kong market by promising to shorten approval times. It has also tightened regulations for companies looking to list in the US, pushing some deals back to Hong Kong. Though not officially required by law, approvals by the China Securities Regulatory Commission are widely seen as necessary for Chinese companies before they can list overseas. 
However, secondary and dual listings tend to pay lower offering fees to underwriters, as they are more similar to a follow-up share flotation than an IPO. One example is the Hong Kong listing of lithium battery maker <a href="/company/catl">Contemporary Amperex Technology</a> (CATL), where underwriting fees were roughly 20 basis points, or 0.2% of the deal's total value. Typically, companies seeking pays flat rate commissions <a title="" href="https://asia.nikkei.com/business/finance/hong-kong-s-ipo-boom-sets-off-underwriter-price-war" target="_blank" rel="noopener">ranging 2–4%</a>, plus optional incentives between 1–2%. CATL was already listed on the mainland market when listed in Hong Kong.
This article first appeared on <a href="https://asia.nikkei.com/business/markets/trading-asia/can-hong-kong-s-ipo-market-keep-up-the-momentum-in-2026">Nikkei Asia</a>. It has been republished here as part of 36Kr’s ongoing partnership with <a href="https://www.rwegrgdf5.eu.org/nikkei-teams-up-with-36kr-in-asia-tech-news-coverage/">Nikkei</a>.

Can Hong Kong's IPO market keep up the momentum in 2026?

Hong Kong

<a href="/company/baidu">Baidu’s</a> autonomous ride-hailing service Apollo Go and AutoGo have officially launched a fully autonomous commercial ride-hailing service in Abu Dhabi, marking a new phase in the commercialization of driverless mobility in the Middle East. The service, which is open to the public via the AutoGo app, has launched initially on Yas Island, where users can now hail rides in vehicles operating with no human driver behind the wheel.
The launch positions Abu Dhabi among a small group of global cities offering fully driverless robotaxi services under a commercial framework, rather than as part of a limited pilot or trial. It also reflects growing regulatory confidence in autonomous vehicle technology as regional governments explore new mobility models to support urban growth and smart city development.
The service follows the partners’ receipt of a fully driverless commercial permit in mid-November 2025, clearing the way for public operations. Yas Island, a major leisure and entertainment hub in the emirate, has been designated as a permitted zone for fully autonomous vehicles, allowing the partners to begin commercial deployment in a controlled but high-profile urban environment.
Apollo Go and AutoGo first announced their partnership in March 2025, with the stated goal of building Abu Dhabi’s largest fully driverless fleet. The public launch comes just months after that initial agreement, underscoring the pace at which the partners have moved from collaboration to live operations.
<figure id="attachment_159368" aria-describedby="caption-attachment-159368" style="width: 640px" class="wp-caption aligncenter"><img loading="lazy" decoding="async" class="wp-image-159368" src="https://console.rwegrgdf5.eu.org/wp-content/uploads/2026/01/AutoGo-Apollo-Go-Dubai.jpg" alt="Photo of a robotaxi operated by Apollo Go and AutoGo in Dubai, UAE." width="640" height="360" srcset="https://console.rwegrgdf5.eu.org/wp-content/uploads/2026/01/AutoGo-Apollo-Go-Dubai.jpg 1920w, https://console.rwegrgdf5.eu.org/wp-content/uploads/2026/01/AutoGo-Apollo-Go-Dubai-720x405.jpg 720w, https://console.rwegrgdf5.eu.org/wp-content/uploads/2026/01/AutoGo-Apollo-Go-Dubai-1024x576.jpg 1024w, https://console.rwegrgdf5.eu.org/wp-content/uploads/2026/01/AutoGo-Apollo-Go-Dubai-768x432.jpg 768w, https://console.rwegrgdf5.eu.org/wp-content/uploads/2026/01/AutoGo-Apollo-Go-Dubai-1536x864.jpg 1536w, https://console.rwegrgdf5.eu.org/wp-content/uploads/2026/01/AutoGo-Apollo-Go-Dubai-480x270.jpg 480w" sizes="(max-width: 640px) 100vw, 640px" /><figcaption id="caption-attachment-159368" class="wp-caption-text">A robotaxi operated by Apollo Go and AutoGo in Dubai, UAE. Photo courtesy of Baidu.</figcaption></figure>
Following the Yas Island rollout, the service is set to expand in phases across Abu Dhabi, beginning with Reem Island, Al Maryah Island, and Saadiyat Island. Over time, the partners plan to extend coverage to additional areas, with the long-term objective of operating across the wider emirate.
The companies have said they aim to deploy hundreds of autonomous vehicles by 2026, building what they describe as the emirate’s largest fully driverless fleet. The focus, they said, is on scaling a commercially viable service rather than limiting operations to small test fleets.
Apollo Go’s expansion into the UAE builds on its experience operating large-scale robotaxi services across multiple cities globally. The company has logged more than 240 million autonomous kilometers, including over 140 million kilometers in fully driverless mode, and has completed more than 17 million cumulative rides as it pushes toward broader commercialization.
Elsewhere in the UAE, Apollo Go has secured regulatory approval to advance autonomous driving operations. In Dubai, the company has received the emirate’s first permit to conduct fully driverless vehicle trials on designated public roads without a safety driver, as it works toward launching a commercial ride-hailing service there as early as the first quarter of 2026. The parallel developments point to a broader UAE approach that pairs large-scale testing with early commercial deployment across different emirates.
The company has also accumulated experience working with regulators outside mainland China, including in dense urban environments such as <a href="https://rwegrgdf5.eu.org/hong-kong-opens-roads-to-self-driving-cars-with-baidu-apollo-pilot">Hong Kong</a>, where authorities have taken a cautious, phased approach to approving autonomous driving technologies. That regulatory engagement has mainly focused on demonstrating operational readiness and safety at scale.
More broadly, Apollo Go has identified overseas markets as a strategic priority as global robotaxi competition intensifies, with <a href="https://rwegrgdf5.eu.org/uk-europe-emerge-as-robotaxi-battleground-for-baidu-and-waymo">regions such as Europe and the Middle East emerging as key arenas for international expansion</a>, alongside players including Waymo.
As for Abu Dhabi, the launch fits within broader smart city plans to introduce advanced mobility services into everyday use. With a fully autonomous, commercially available ride-hailing service now operating on public roads, Apollo Go and AutoGo are on track to shift driverless transport from concept to deployment.

Baidu launches fully driverless ride-hailing service in Abu Dhabi

Baidu

Autonomous Vehicles

Middle East

Haidilao has announced a series of changes to its senior management and board of directors.
According to a filing by the Hong Kong-listed company, effective January 13, 2026, Gou Yiqun has resigned as executive director and CEO. Song Qing has stepped down as executive director and a member of the nomination committee, while Gao Jie has resigned as executive director. All three will continue to hold key management roles within the group.
Following his resignation as CEO, Gou will oversee the group’s initiatives in intelligent and automated management systems, focusing on upgrading operating models and developing a centralized smart management platform to improve efficiency and decision-making. Song will continue to serve as chair of the product committee.
Alongside the departures, Haidilao appointed four new executive directors, Li Nana, Zhu Yinhua, Jiao Defeng, and Zhu Xuanyi, effective January 13. The company said the appointments are aimed at supporting long-term innovation and cultivating a new generation of management talent.
The most significant change is the return of founder and chairman Zhang Yong, who has resumed the role of CEO, also effective January 13. Haidilao’s shares rose more than 7% at the opening of trading on the Hong Kong Stock Exchange the following day.
The reshuffle comes amid renewed pressure on Haidilao’s core business, as slowing traffic and softer consumer spending weigh on performance across China’s casual dining sector. In the first half of 2025, the company reported year-on-year declines in both revenue and profit, while key operating indicators such as table turnover also showed signs of weakening, according to Chinese media reports.
Zhang’s return to the CEO role is widely seen as an attempt to restore strategic clarity and execution speed. Since stepping aside in 2022, Haidilao has cycled through multiple chief executives, with each leadership phase reflecting a different priority ranging from cost controls and operational stabilization to experimentation with new formats. Since 2024, the company has rolled out several sub-brands, including Yan Qing and BarBecue, as it expands beyond hotpot.
According to the company’s 2025 interim report, Haidilao operated 126 restaurants across 14 brands in addition to its flagship hot pot chain.

Haidilao reshapes top management, with founder Zhang Yong resuming CEO role

… center developer and operator founded in 2017 and backed by private equity firm Warburg Pincus, is an example of how the industry is financing its Asian expansion with the help of institutional investors and more complex debt instruments.
In June last year, it secured a USD 1.3 billion preferred equity investment from US infrastructure fund Stonepeak. These instruments rank higher in a company's capital structure than common equity—giving holders priority in a restructuring—and offer fixed dividends, in the manner of a bond. They can also be converted into common equity under certain conditions.
Salgame said the Stonepeak investment would help the company expand but would dilute the holdings of shareholders. PDG's last equity round came in 2022 when it raised USD 505 million from investors led by Abu Dhabi's sovereign wealth fund, Mubadala.
Shortly before it sold the preferred shares, PDG took on USD 1.2 billion in debt, which included USD 800 million in project financing for several data centers in Asia and a USD 400 million "holdco" loan from a consortium of global banks led by Barclays, BNP Paribas, and Deutsche Bank.
In holdco deals, developers set up a holding company that can borrow on behalf of more than one project. This offers greater flexibility, but costs more. Interest rates tend to be about two to three percentage points higher, bankers say.
The higher rates, in turn, attract institutional investors.
Chin Seng Chew, a Singapore-based partner at law firm Clifford Chance, said this "basically allows borrowers to stretch their credit, and they can go to potentially a different pool of investors, particularly the credit funds."
Tom Capel, a counsel at Clifford Chance, added:
<blockquote>"One of the reasons it's such an attractive asset class is the returns are there to enable developers to maximize leverage through multiple layers of debts, which we are not seeing to the same extent in other asset classes in the region."</blockquote>
Borrowing more to increase leverage is a way for data center operators and their private equity backers to amplify returns. But that could leave them stranded if the music stops, since lenders get paid ahead of equity investors in a restructuring.
Aggressive financing strategies also work for data centers with private equity investors because these financial sponsors tend to look for returns in the short to medium term. As a result, the developers will pay higher interest rates for their borrowings "as long as they complete the project within a designated time frame," said Tanky Yun, executive director for corporate development and strategy at OneAsia Network, a Hong Kong-headquartered data center operator.
"At the end of the day, if the cost is getting much higher while the return is getting less, new capital will diminish," he said. "But this will only happen when there is excessive supply."
In the Malaysian state of Johor, overbuilding is a painfully familiar subject. Not far from the state capital of Johor Bahru is <a title="https://asia.nikkei.com/economy/malaysia-seeks-to-revive-forest-city-ghost-town-as-financial-hub" href="https://asia.nikkei.com/economy/malaysia-seeks-to-revive-forest-city-ghost-town-as-financial-hub" target="_blank" rel="noopener">Forest City</a>, a USD 100 billion residential development by China's Country Garden that is now largely deserted. It was constructed as part of an effort by the Johor government to develop a special financial zone modeled on China's Shenzhen.
Johor now has 15 operational data centers, with another 11 under construction and 25 approved projects, for a combined capacity of 5.3 GW, state officials have told Nikkei Asia. Whether all these projects will meet the expectations of prospective tenants remains to be seen.
"The critical question is not how many data center projects are being announced, but whether their design and operations can meet long-term reliability requirements," said Zul Azhan Abu Bakar, a facilities management consultant based in Johor.
"It's not just about how fast the construction can be done, or how much land is available," he said. "Data centers are growing fast in Johor. It's important that future operations can keep up."
This article first appeared on <a href="https://asia.nikkei.com/business/technology/tech-asia/asia-s-ai-data-center-financing-gets-complicated">Nikkei Asia</a>. It has been republished here as part of 36Kr’s ongoing partnership with <a href="https://www.rwegrgdf5.eu.org/nikkei-teams-up-with-36kr-in-asia-tech-news-coverage/">Nikkei</a>.

Asia's AI data center financing gets complicated

AI Infrastructure

Southeast Asia

… FJDynamics’ aggressive push into Europe and North America. Competitive pricing and solid performance helped it gain traction quickly.
Unlike China’s more saturated market, Europe remains relatively underpenetrated in smart agriculture. According to <a href="https://www.mordorintelligence.com/industry-reports/europe-agricultural-machinery-market">Mordor Intelligence</a>, Europe’s agricultural machinery market is expected to grow from USD 43.34 billion in 2025 to USD 50.97 billion by 2030, with telematics adoption likely to increase as sustainability reporting becomes more data-driven.
European farms, particularly in Western Europe, tend to be large-scale and highly mechanized. Farmers in countries such as Germany, France, and the Netherlands are often willing to pay a premium for technology that improves efficiency and reduces labor costs.
Legacy manufacturers such as John Deere and Claas dominate in hardware, but their software development cycles are slower than those of newer technology firms. FJDynamics and other Chinese players benefit from advantages in algorithms, cost efficiency, and faster iteration.
As a result, FJDynamics’ products are often priced 20–30% below comparable Western offerings while maintaining competitive performance. Yet, whether this overseas advantage can sustain growth and ultimately drive a broader turnaround remains an open question.
KrASIA Connection features translated and adapted content that was originally published by 36Kr. This <a href="https://36kr.com/p/3608965058741513">article</a> was written by Song Wanxin for 36Kr.

Can IPO-bound FJDynamics turn its European traction into investor confidence?

Investment

Europe