Evergrande, China's Conglomerate Company Hui Ka Yan Tenggrets To Electric Vehicle Business, Selling Hengchi 5 Starting From IDR 379 Million Per Unit

JAKARTA - Property developer belonging to Chinese conglomerate Hui Ka Yan, Evergrande Group has officially transferred its main business in the property and real estate sector to a battery-based electric vehicle (EV) production business.

Quoted from Channel News Asia, Monday, September 19, the production of the Hengchi 5 model started on Friday, September 16 at a factory in the northern city of Tianjin. Previously, Evergrande launched its first electric car last year via China Evergrande Energy Vehicle Group Ltd and deliveries will begin in October 2022.

Evergrande will start mass-producing EV models in the first half of 2023 and the third phase in the second half of next year. Evergrande CEO Hui Ka Yan is determined to transfer his main business to the realm of the car business.

His party will make 1 million vehicles by 2025. Meanwhile, sales of this EV unit are key for Evergrande to pay off the company's debt obligations of US$300 billion or IDR 4,235 trillion.

Meanwhile, sports-utility Hengchi 5 vehicles can be ordered with a pre-order system that is not binding with prices starting at 25.3 thousand US dollars or IDR 379 million. The order has been open since July 2022 after Evergrande had postponed production from June.

Previously, the property developer of the world's largest debt owner made an explanation of the company's restructuring plan. However, the presentation has actually drawn criticism from investors, causing the shares of issuers to plummet.

Evergrande is considered to have failed to uncover the long-promised restructuring. The exposure to foreign debt within the openness of Chinese authorities is considered different from what was promised.

It also disappoints investors who have been waiting in the hope that the proposal will provide clarity on debt extensions and asset sales.