Xpeng CEO He Xiaopeng stands next to the company’s P7 electric sedan as he addresses media at the 2020 Beijing auto show.Evelyn Cheng | CNBCIn July 2020, local branches for four of the “big five” banks extended 10.4 billion yuan in credit to Nio for the start-up’s China operations based in the city of Hefei near Shanghai. Participants in this deal included China Construction Bank, Industrial and Commercial Bank of China, Bank of China and Agricultural Bank of China, according to an announcement from Nio. In China’s state-dominated system, the banks prefer to lend to state-owned enterprises. That makes it difficult for privately owned companies to get financing, unless they can convince the state-owned banks of their ability to repay loans. Xpeng’s credit line announcement comes after the company raised more than $4 billion last year in its initial public offering on the New York Stock Exchange in August and a follow-on offering in December. Shares have soared more than 195% since the IPO. Where is the money going?The start-up did not disclose details on credit terms Tuesday. The agreement will help the Guangzhou-based company expand its manufacturing, sales and services and other operations, according to a release. Xpeng said it began building a second factory in November. The company said it has opened 116 retail storefronts and 50 service centers, as of Sept. 30. And Xpeng revealed in September it is investing in the development of flying vehicles. Deliveries totaled 27,041 last year, with more than half coming from a new P7 sedan that began mass deliveries in late June. The company added it delivered 100 units of its G3 SUV to customers in Norway in December.Although overall deliveries more than doubled from a year ago, Xpeng’s figures fell short of Nio’s more than 43,700 deliveries. Nio’s vehicles have targeted the higher end of the market, while Xpeng’s price range has been lower. In the last two weeks, both companies announced plans for new sedans. Nio’s is expected to arrive in the first quarter of next year. Xpeng claims its sedan will begin deliveries later this year.