Embattled Chinese billionaire to bring electrocar production to Guangzhou, with government support
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Jia Yueting, founder of indebted tech conglomerate LeEco and CEO of Faraday Future, a futuristic electric vehicle maker based in the US, is reportedly planning to bring his auto upstart's EV technologies and production lines to the Nansha area of south China's Guangzhou, with local government's backing.

On April 8, Ruichi Smart Car Guangzhou Co., a company affiliated with Jia's Faraday Future, acquired a plot of land for 364.1 million yuan in Nansha's Wanqingsha Bonded Port Manufacturing Cluster, an area earmarked for processing and manufacturing industry.

Geographically, Nansha is the geometric center of the Pearl River Delta. Being a tech development zone since 1993, the district's flat terrain is densely covered by a network of rivers. Endowed with a mild weather and abundant rainfall, Nansha has been known since the Qing Dynasty for its tens of thousands of hectares of tidal land, although today it’s the sight of rolling wheels and roaring motors that greets the visitors.

Thepaper.cn, a Shanghai-based news portal, visited the plot of land in Wanqingsha acquired by Ruichi and found that some construction workers and engineering trucks were stationed there. A worker told the media that the site is meant for building a car factory.

Since the news broke, Jia Yueting's eligibility to lease the land was called into question, considering he's been added to a nationwide list of debt defaulters by China's government.

Faraday Future previously informed the media that all money spent on acquiring the plot of the land comes from strategic investors, who bear no connection to the debts of LeEco, a Chinese multinational conglomerate founded by Jia Yueting and has been experiencing financial problems since 2016.

Nansha's local government confirmed the FF statement, noting Ruichi is a legally set up foreign-invested company with independent operation and no legal connections with LeEco or the group's other indebted affiliates, according to thepaper.cn.

“New-energy vehicles are now our (Nansha district) priority and we have carefully reviewed the electric car project in terms of investment plans, risk assessment, economic calculation and use of land,” the Nansha government told thepaper.cn, adding it is now proactively pushing forward the FF project.

Back in 2004, when GAC Toyota Motor Co., a joint venture, set up a factory in Nansha, supporting industries for auto manufacturing had begun to be put in place. The Guangzhou port has also built a wharf for importing and exporting motor vehicles. In 2015, the Nansha district was designated as a pilot free trade zone with Wanqingsha being turned into a bonded port covering 10 square kilometres.

The Wanqingsha Bonded Port Manufacturing Cluster was announced as being specialized in developing intelligent devices, high-end equipment, new-energy vehicles and new-generation IT industries in October 2017.

Ruizhi Smart Car Guangzhou Co. was established this February with a registered capital of $300 million in the legal person of someone names Wang Zhigang. Falling into the category of “sole proprietorship from Taiwan, Hong Kong and Macao”, the address given by Wang is Beigaoyu village, Linfen, Shanxi which happens to be the hometown of Mr. Jia Yueting.

Faraday Future previously said in a statement the land purchase in Nansha is intended for “transferring FF technologies, products and intellectual property rights to China, which marks a concrete step in facilitating the national strategy to upgrade the automotive industry,” as reported by the thepaper.cn.

And Nansha may not be the only location for Jia's demestic EV factories. A year and a half ago, Jia's LeEco group announced to build a Leshi Motor Ecological Park in Moganshan, a high-tech district in Deqing county, Huzhou, East China's Zhejiang province.

According to a statement by the Zhejiang Development and Reform Commission dated September 1, 2016, Jia's tech group would invest 20 billion yuan to build automobile factories in Moganshan with an annual production capability of 400,000 units. The Chinese conglomerate under frantic expansion was not yet threatened by cash crunch back then.

Since then, LeEco spent over 0.4 billion yuan to acquire several plots of land in Deqing county for building the factory project until last June when Jia's personal assets along with corporate assets owned by LeEco's private companies were frozen by courts and the prospects of the EV enterprise furthered dampened.

Thepaper.cn visited the motor ecological park in Moganshan this April only to find the construction site in a run-down state with no workers around. Suffering from a shortage of funds and the new purchase in Nansha, the future of the Zhejiang project is in doubt.

Some working staff with Moganshan's local government told thepaper.cn although LeEco failed to update them with any development about the project, the company's local office has been staffed till now. Based on a previous report by thepaper.cn, Deqing's county government had specially assigned nine offices in the Moganshan hi-tech zone for LeEco's planning team and the two parties had remained in close contact.

Now, Faraday Future is sparing no effort to realize mass production of its first car—FF91. Jia Yueting announced this February at a suppliers' forum that FF has acquired financing of $1.5bn to satisfy the IPO requirement with the company's product FF91 planned to be rolled out by the end of 2018.

Jia addressed a general assembly at FF's Los Angeles headquarters on April 20, indicating the company's Hanford factory would be put into operation this May, with all manufacturing equipment having been purchased. Given that both construction sites in China are almost “deserted”, it's believed the production of FF91 will begin first in Hanford, the company's US factory.

According to Yicai Global, an English-language financial news portal, Jia unveiled the FF91 car at the aforementioned supplier conference in the US, saying it would be more powerful than a Tesla and could cost as much as $250,000 in the United States. With import tariffs, that jolts up to $317,500 in mainland China. In the circumstances, the company could cut costs by bringing its production lines back home.
 
 

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