SAN FRANCISCO (Reuters) -- Startup company Better Place has scored $200 million of financing from investors including General Electric Co. and UBS, valuing the operator of battery-switching and charging networks for electric cars at $2.25 billion.
The Palo Alto company, which has now secured $750 million of financing from investors such as VantagePoint Capital Partners and Morgan Stanley Investment Management, said on Friday the new cash will bankroll a European expansion.
Better Place, which says its networks expand the range of current-generation electric cars and hence speed their mass adoption, begins operating in Israel, Denmark and Australia in early 2012.
It has already deployed stations across California, southern China, Japan and Canada, it said in a statement.
"We are entering the next phase of growth for our company where we prove that our solution works, that it's in demand, and that it scales, as we begin to push into new markets and attract new investors and new partners," CEO Shai Agassi said in the statement.
Drivers have been slow to embrace electric and rechargeable vehicles, in part because of their higher cost. Another common complaint is electric vehicles, like Nissan Motor Co.'s Leaf, have limited driving range before needing to recharge.
In the U.S. market, demand has also been held back by a lack of models to choose from, skimpy infrastructure for charging the vehicles, and low gasoline prices compared with other industrialized nations.
But automakers are jumping on the bandwagon, afraid of missing out on a growing trend. General Motors Co. confirmed last month it will make its first all-electric vehicle, a version of the Chevrolet Spark mini-car.
Ford Motor Co. will introduce an electric Focus by the end of this year, and ramp up production in early 2012.
Better Place, whose other investors include HSBC , Israel Corp., Ofer Group and Maniv Energy Capital, operates networks of stations where drivers can stop to exchange depleted batteries for new ones, or charge existing batteries. The company argues that switching out batteries saves time.
News of the new financing comes as U.S. regulators launch an investigation into the safety of electric vehicle batteries after a Chevrolet Volt caught fire following a routine crash test.
Experts say lithium-ion batteries -- such as those used in the Volt, and similar to the kind that Better Place supplies -- deliver the power and range that electric vehicles require, but the current generation of lithium-ion batteries also has a tendency to overheat.