Leekr Technology, a Shanghai-based supplier of chassis control systems to electric vehicle (EV) makers, plans to double production capacity this year in response to surging demand for its products.

The start-up, founded just two years ago, might raise additional capital soon to fund its expansion as Shanghai, China’s “Motown”, ramps up support for the automobiles supply chain.

The company will not be able to execute new orders for its chassis control systems without installing new facilities, Su Ganting, Leekr’s co-founder, told the Post on Wednesday.

“Growth of the new-energy vehicle [NEV] industry [in China] has largely outpaced our production expansion,” he said. “We want to grasp opportunities to work with more partners to maintain our [growth] momentum.”

A chassis control system, or chassis by wire, refers to the use of electrical or electromechanical systems to perform vehicle functions traditionally achieved by mechanical linkages. These systems are increasingly being adopted in battery-powered vehicles, as they ensure the safety of cars while improving their driving range.

According to a report by Citic Securities, the chassis accounts for 10 per cent of the total cost of making a vehicle. Chassis by wire involves control over braking, steering, accelerating and gear-shifting systems.

Leekr, founded by a group of veterans from Bosch and ZF Group including CEO Hui Zhifeng and Su, started mass production in July last year. Its production capacity will double from last year’s 300,000 units to about 600,000 chassis control systems in 2023, said Su, who is also in charge of Leekr’s research and development (R&D).

The company is likely to complete new fundraising deals in the coming months. In May last year, Leekr received 200 million yuan (US$29.5 million) from investors including the local government’s guidance fund, which was set up by the city’s Lingang free-trade zone. The proceeds were used to build its manufacturing facilities and to support R&D.