Evergrande Motors issued an announcement on the Hong Kong Stock Exchange stating that the group has the risk of suspending production if it cannot obtain new liquidity.
Evergrande said that if the group can seek financing of more than 29 billion RMB in the future, it still plans to launch a number of flagship models and hopes to achieve mass production. Under this plan, the cumulative unlevered cash flow from 2023 to 2026 is expected to be between negative RMB 7 billion and negative RMB 5 billion.
All the above-mentioned financial forecasts are based on the 2021 management report and depend on many assumptions and prerequisites. There are many uncertainties, and the company cannot guarantee that it will operate according to the aforementioned forecasts.
It is worth mentioning that the official also mentioned that Evergrande New Energy Vehicles has delivered more than 900 vehicles as of today. According to previous report Hengchi 5 will be officially mass-produced on September 16, 2022, and the first mass-produced cars will be delivered on October 29, 2022.
To be able to maintain basic business operations due to tight liquidity, Evergrande New Energy Auto has taken steps to cut costs, such as cutting its workforce, officials said.
Evergrande New Energy had 2,795 employees as of March 2023, compared to 3,742 as of June 30, 2022.
