Evergrande has a plan to roll off the electric vehicle production line in 2022.
The company said it had a meeting with the local government where its production base is in Tianjin. The company also met suppliers while pushing forward the production of its electric cars.
New Energy Vehicle Group (China Evergrande) shares in morning trade were up more than 11%. However, it pared some of those gains. They were around 7% higher in Hong Kong.
Evergrande has ambitions to deliver electric vehicles to customers for the first time in its business history. It previously promised that the company would produce and sell around 1 million cars annually in the following five years.
Tianjin’s local government took responsibility to coordinate with financial institutions in order to support Evergrande in achieving its mass production plan. Its parent company (Evergrande Group) has a hard time paying off around $300 billion of liabilities. So far, it is considered the world’s most indebted estate developer. It missed a couple of bond payments as well. The global market seems annoyed because of fears that the company`s current condition might have contagion effects and damage the global economy. It concerns some investors that resulted in falling confidence in Evergrande.
Several months ago, Evergrande said that the company experienced suspensions and delays to its electric vehicle unit suppliers. These delays resulted in a suspension for some projects across the group. For now, Evergrande is waiting for new investors.
The company said it examined multiple models of its electric car throughout the year. However, Evergrande tries in China to enter a highly competitive electric car market and face companies including Nio and Xpeng. At the same time, there are also existing players such as Tesla and BYD.
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