HONG KONG, March 23 (Reuters) – China Evergrande New Power Automobile Group Ltd (0708.HK) stated on Thursday it could should halt manufacturing of electrical autos (EVs) if it couldn’t get hold of contemporary funding, after delivering greater than 900 models of its flagship Hengchi 5 mannequin.
The EV manufacturing unit of the embattled developer China Evergrande Group (3333.HK) stated it was aiming to chop prices via measures comparable to decreasing employees numbers and bettering administration effectivity.
“In face of the lack to acquire further liquidity, the Group is susceptible to discontinuing manufacturing,” it stated.
If, nonetheless, it might get hold of financing of greater than 29 billion yuan ($4.2 billion) “sooner or later”, it aimed to launch a lot of flagship fashions and hoped to realize mass manufacturing, the corporate stated in a press release.
Underneath that plan, the cumulative unleveraged money movement from 2023 to 2026 was anticipated to succeed in detrimental 7 billion yuan to a detrimental 5 billion yuan.
The information comes after its mother or father, China Evergrande Group, on Wednesday introduced plans for the restructuring of its $22.7 billion in offshore debt, which might set a template for distressed rivals within the nation’s property sector. learn extra
The unit beforehand stated it might begin mass manufacturing of its second EV mannequin within the first half of 2023 and a 3rd within the latter half of this 12 months.
It had additionally stated it aimed to make 1 million autos a 12 months by 2025.
In December, the unit stated it was shedding staff and chopping the salaries of some staff as part of its cost-reduction measures.
The EV unit is vital for the transformation plans of Evergrande, as soon as China’s top-selling property developer and now on the heart of a deepening debt disaster.
Shares of the unit have been suspended since April 2022.
($1 = 6.8802 Chinese language yuan)
Reporting by Donny Kwok and Anne Marie Roantree; Modifying by Stephen Coates
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