[Asia Economy Reporter Kim Bo-kyung] Major foreign media reported on the 14th that China has authorized the sale of electric vehicles from Hengda Auto, a subsidiary of Hengda Group, which is in a state of default.
The electric vehicle catalog published by China's Ministry of Industry and Information Technology on the same day included two Hengchi (恒馳) models mass-produced by Hengda Auto.
Electric vehicles included in this catalog are allowed to be sold and are eligible for government subsidies upon purchase. It is reported that the Hengchi models received sales approval on the 8th.
According to foreign media citing sources, Hengda Auto is expected to start selling the Hengchi models as early as next month.
The sources stated that although sales targets were not set high this year due to production constraints, production will be rapidly increased next year.
Hengda Chairman Xu Jiayin established Hengda Auto in 2019 with a capital of 2 billion dollars (approximately 2.475 trillion KRW) and entered the electric vehicle market.
Since then, Hengda presented a blueprint to produce over 1 million electric vehicles annually at factories in China and overseas by 2025. However, due to the parent company's liquidity crisis, mass production only began last January, later than originally planned.
The funds invested by Hengda in the electric vehicle business are estimated to reach 29.4 billion yuan (approximately 5.7039 trillion KRW).
As the parent company Hengda struggles with financial difficulties, Hengda Auto also faced a management crisis last year, failing to pay some suppliers and employees their dues and wages.
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