Struggling Chinese new energy vehicle startup WM Motor is reportedly resuming production next month, thanks to the support of its investor Xiangfei Automobile Sales.
Xiangfei Auto and WM Motor are advancing the resumption of mass production of the EX5 and E5 electric vehicle models at the latter’s plant in Wenzhou, Zhejiang province, Chinese tech media outlet MingJin Pro reported on July 14, citing an internal white paper addressed to suppliers that it obtained from a former WM Motor employee.
Founded in 2015, WM Motor was one of the first NEV startups in China to achieve mass production. However, it fell into a liquidity crisis in the second half of 2022 and halted production. In January, it announced that its pre-restructuring application was approved by a court in Shanghai.
Xiangfei Auto has taken over WM Motor and its three associated companies, according to a reorganization plan approved by a court on April 3, the white paper also showed.
The ‘new WM Motor’ will produce 10,000 vehicles this year, possibly overachieving to reach 20,000 units, according to the reorganization plan. It intends to build a knock-down plant in Thailand to explore the Southeast Asian and Middle Eastern markets and achieve its production target of 100,000 units next year.
From 2027, WM Motor will have annual sales targets of 250,000 to 400,000 units, boost the production of models equipped with advanced driving assistance systems, empower its supply chain through artificial intelligence technologies, and start preparations for an initial public offering, the plan showed. By 2030, the carmaker will aim to produce one million units of vehicles and achieve revenue of CNY120 billion (USD16.7 billion).
In terms of products, WM Motor plans to release over 10 new EV models in the next five years, including pure electric and extended-range electric ones, covering all types of cars, from sedans to sports utility vehicles and multi-purpose vehicles.
Even though the plan is very detailed, WM Motor is still facing great challenges, as the competition in the Chinese NEV market is getting increasingly fierce, industry analysts believe. WM Motor’s brand image was negatively affected, so it will need time to regain recognition in the market, they noted.
According to the white paper, the municipal government of Wenzhou and the city’s Marine Economic Development Demonstration Zone have established a special working group offering assistance to WM Motor for the production resumption after the reorganization, including coordinating local suppliers.
Xiangfei Auto is also proactively discussing with local financial institutions to launch fundraisers using its high-quality assets as credit enhancement to offer fund guarantees to finance equipment upgrades, rebuild the supply chains, and expand operations.
Founded in September 2023, Xiangfei Auto has a registered capital of CNY100 million (USD13.9 million). Its legal representative, Huang Jing, is the actual controller of Baoneng Motor Group, the carmaking arm of Chinese real estate and financial conglomerate Baoneng Investment Group, and his associated parties hold stakes in Baoneng Motor’s affiliate firms.
Baoneng Motor was inducted into a blacklist for dishonest acts, subject to enforcement, and was given fines worth over CNY12 billion.
WM Motor had debts of about CNY20.4 billion (USD2.8 billion) and assets of just CNY4 billion (USD557 million) at the beginning of last year. According to data from the Shanghai court, WM Motor’s valid claims exceeded CNY14.8 billion, with CNY11.2 billion of creditor rights being temporarily held off.
