Evergrande sees itself more in e-mobility than in real estate

Evergrande Auto, the e-car division of the Evergrande Group, which is now highly indebted, intends to continue with the plans to produce electric cars. Despite the undeniable massive liquidity crisis of its own parent company. On the contrary, Evergrande‘s focus on the e-mobility division will be strengthened. So you want to consciously rely on the expansion of the e-business and give it priority over the ailing real estate core business.

Just last week, the company was able to avert major damage with a last-minute payment. As part of this, CEO Hui Ka Yan announced through state-run media that within 10 years Evergrande would make its new electric car company its main business instead of real estate. This led to a growth in investor confidence.

Raymond Cheng, head of China research at CGS-CIMB Securities, said the business relocation makes sense given Beijing’s increasing support for electric vehicles and increasingly tightening regulations for the burgeoning real estate sector. While the move would help Evergrande reduce debt by gradually reducing its massive vacant land holdings, Cheng said it was unclear how it would affect the company’s planned divestitures, including shares in E-Auto -Branch.

The original plan was for Evergrande Auto to become the world’s leading electric car group in terms of size and competitiveness within the next three to five years. We remember August 2020, when the Chinese company, known to some as the owner of the Saab successor NEVS and the main shareholder of the electric car start-up Faraday Future, presented six new electric car models of its Hengchi brand. Currently, 14 electric cars are being developed under the Hengchi brand, covering major passenger car segments including sedans, sport utility vehicles and MPVs.

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