HiPhi Gives Itself Three Months To Turnaround, Will It Succeed?
It looks like many Chinese EV brands like HiPhi will disappear by year’s end
Looks like some Chinese EV manufacturers will not last till year end. Is this yet another casualty of the very infamous electric vehicle (EV) price wars in China? Well, officially, it is not directly because of this, but unofficially, we all know this is the indirect and main factor behind this potential shutdown.
So, Shanghai EV automaker HiPhi is giving itself three months to turnaround or face a bankruptcy and shutdown, says founder David Ding. This week, the EV upstart announced it will halt production for up to six months as well. So clearly the situation for the brand right now is so bad that it only has 3 months to pull off a miracle?
Moreover, staff were reportedly not paid their January wages, to make matters worse. HiPhi’s predicament has been officially caused by long-term poor sales. It sold only 4,237 vehicles in 2021 and 4,349 in 2022. Despite this, sales rose last year, but only to 8,681. Still not enough to help the brand stay afloat, apparently.
HiPhi will also tie up with Yancheng Yueda Zhi Chuang New Energy Cars to guarantee after-sales services, it said and the company will form a special working group to try and save the brand, but it may shut down if these efforts fail, Ding said, adding that the pressure is considerable on all sides.
On top of that, China’s new energy vehicle (NEV) industry has developed rapidly but that has brought intense competition. Fifteen NEV makers have announced either bankruptcy or a business crisis, including WM Motor, Enovate, Singulato, and Aiways. These are also likely collateral damage from the EV price wars.
HiPhi’s shutdown has attracted a lot of attention, and many firms have shown an interest in acquiring or investing in it, Ding said. Whether or not this will help is up to interpretation because there is a chance given how desperate HiPhi is right now, any other brand can take over and change it completely from the ground up.
Regardless, HiPhi started it is making big changes in its operations on 19 February 2024 and is now trying to find solutions to save itself. HiPhi will continue offering user services and after-sales vehicle maintenance, and the firm said these are among its top priorities as it tries to find a way out of the situation.
What do you guys think? Will HiPhi survive until the end of the year?
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