Tesla’s Chinese challenger Evergrande slams brakes on electric car investments amid slowing sales
- Billionaire Hui Ka-yan, Evergrande’s chairman, says that investments will be reduced from 20 billion yuan this year to 10 billion yuan in 2021
- Company says it’s on track to debut its Hengchi 1 electric car model in the first half of next year, with production planned for 2021.
China Evergrande plans to slow down its pace of investments in electric vehicles as sales of the environmentally friendly cars continue to fall in the mainland, but the company says it is on track to debut its “Hengchi 1” model next year.
The company, which sees itself as Tesla’s main challenger in China, will invest a total of 45 billion yuan (US$6.4 billion) by 2021, chairman Hui Ka-yan said at a conference organised by Evergrande that brought together global car-related companies in Guangzhou on Tuesday.
The investments will be reduced from 20 billion yuan this year to 15 billion yuan next year and will be further cut to 10 billion yuan in 2021.
The company said that initial investments in the manufacturing industry are usually high as it involves setting up the plant and machinery and it begins to taper once the business is on track.
Hui, China’s third wealthiest individual, said on Tuesday that the Hengchi 1, the first car developed by the company, will debut in the first half of next year and will go into mass production in 2021.
The company had already invested 16 billion yuan in EVs by June this year, officials said during the interim results briefing in August.