(Previous) The richest man Xu Jiayin is really good at making cars: before the car is put into mass production and launched, the company is rushing to raise funds on the Science and Technology Innovation Board

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“Everyone sees it, everyone wows.”

Evergrande Auto - full name China Evergrande New Energy Vehicle Group Co., Ltd. - is a subsidiary of Evergrande that was renamed after its main business was changed from Evergrande Health.

Now we are really doing what we say and are going to sprint towards the Science and Technology Innovation Board.

According to IPO Early News, Evergrande Auto has recently signed a listing guidance agreement with Haitong Securities, and registered with the Shenzhen Securities Regulatory Bureau, and plans to be listed on the Science and Technology Innovation Board.

Earlier in late September, Evergrande Auto issued an announcement on the Hong Kong Stock Exchange, stating that the company's board of directors had decided to issue RMB shares and strive to enter the Science and Technology Innovation Board.

Earlier on August 3, Evergrande Auto held a press conference, unveiling six "Evergrande" models at once, covering all levels from A to D. On the 7th, the Shanghai and Guangzhou production bases were exposed to the public for the first time... It also announced that it would build 36 display and experience centers, 1,600 sales centers, and 3,000 self-built and authorized maintenance and after-sales service centers.

It truly exemplifies the rapid development of the automobile manufacturing industry. I'm afraid Jia Yueting, who has worked with them, would feel ashamed after seeing this.

Moreover, according to Evergrande Auto’s official disclosure, the mass production of the first Hengchi car will not start until 2021.

That’s right, next year.

So if Evergrande Auto continues to demonstrate the "Evergrande speed", perhaps it can create another new feat:

The car has not yet been launched, and the company will go public on the Science and Technology Innovation Board, which was established to encourage technological innovation.

It is expected to issue 1.5 billion shares to raise funds for car manufacturing

Previously on September 25, Evergrande Auto issued an announcement stating:

The initial number of RMB shares to be issued is expected to be no more than 1,555,867,058 shares (before the exercise of the over-allotment option), accounting for no more than 15% of the total number of issued shares after the number of RMB shares proposed to be issued is expanded as of September 30, 2020; and all RMB shares are new shares and do not involve the conversion of existing shares.

In addition, the purpose of fundraising is also stated:

Approximately 70% of the raised funds will be invested in new energy vehicle project research and development, production and marketing network construction projects to continuously increase technical reserves in related fields, further enhance R&D strength and production capacity, expand marketing channels, enhance sustainable development capabilities, and ultimately realize the industrialization of projects under development to help the company's long-term development; the other 30% will be used to supplement operating capital and general corporate purposes to improve financial conditions.

It is worth noting that just three days before the Evergrande Auto board of directors passed the resolution to list on the Science and Technology Innovation Board, Evergrande Auto officially announced that it would arrange to introduce a number of well-known investors such as Tencent, Sequoia Capital, Yunfeng Fund, Didi Chuxing, etc. in the order of old first and new later, raising a total of approximately HK$4 billion.

But even so, HK$4 billion is not a lot for Evergrande's high-profile car-making business.

In 2019, Evergrande Auto CFO Pan Dayong introduced Evergrande Group's estimated investment in the automotive business:

14.7 billion yuan was invested in 2019;

3 billion yuan will be invested in the first half of 2020, and 2.7 billion yuan is expected to be invested in the second half;

9 billion yuan will be invested in 2021.

The three-year budget is 29.4 billion yuan.

After Evergrande Auto goes into mass production and starts selling, Evergrande Group will no longer invest.

From another dimension, it also shows Evergrande's confidence in the revenue and sales of its own cars.

Evergrande Auto is fast

In fact, Evergrande has more than just a serious and reasonable reasoning in terms of finance and investment when it comes to making cars.

Evergrande’s route and method in car manufacturing are also unique and astonishingly fast.

Two years ago, Evergrande’s “car dream” was exposed to the public, and it even had a brief relationship with Jia Yueting on the other side of the ocean.

But afterwards, Evergrande seemed to have found the path that suited it best, and eventually it took 270 days to complete the process from "nothing" to the launch of a new car and the announcement of mass production.

This is an incredible breakthrough for a "cross-border player", which has never been seen in the century-long history of the automobile industry.

However, this may be attributed to the unique thinking of Xu Jiayin, the helmsman of Evergrande, who once summed up the 15-word motto of cross-border car manufacturing:

Buy buy buy, combine combine, circle circle, big big, good good good.

The Daily Economic News reported that "buying, buying, buying" was the first step taken by Evergrande to build cars. Xu Jiayin said frankly:

"For Evergrande, making cars is something that is very unfamiliar. It can be said that it has nothing. As a company that started out as a real estate company, Evergrande has no people or technology to enter the new energy vehicle industry. If it wants to quickly overtake others, it must 'buy, buy, buy'."

Therefore, in 2019, Evergrande invested huge amounts of money in just half a year to acquire related companies such as Guoneng Electric Vehicle, Swedish supercar company Koenigsegg, Shanghai Kane New Energy, German automotive power engineering company hofer, hub motor company Dutch e-Traction and British Protean. While building production bases, it quickly completed the layout of the entire industrial chain from vehicle research and development and manufacturing, power batteries to motors and electronic controls.

Among them, the production bases in Nansha, Guangdong and Songjiang, Shanghai were announced to be completed in the second half of 2020 and put into production in 2021, with an initial planned production capacity of 200,000 vehicles each.

In order to strengthen confidence both internally and externally, Xu Jiayin also visited the Evergrande Automobile Production Base in person some time ago.

At the same time, the introduction of the "black technology" of Evergrande's automobile factory was also hotly discussed on the screen.

Evergrande said that the two bases have entered the equipment commissioning and installation stage. They are built in accordance with the Industry 4.0 standard and equipped with 2,545 intelligent robots. After full production, they will be able to produce one car per minute.

You should know that Tesla's Shanghai Super Factory, which is currently the best-equipped factory in the world, only has a few hundred such intelligent assembly robots.

In addition, Xu Jiayin demonstrated his concern and obsession with car manufacturing throughout the process, and he personally supervised the battle.

At the Hengchi launch conference in August, Evergrande officials introduced that each model was designed by the world's top design masters and built according to luxury car standards, representing the pinnacle of world automotive styling design.

Evergrande officials also revealed that in order to design the six models, Xu Jiayin led senior executives to travel around the world in 2019, with footprints in 23 countries and 47 cities...

Evergrande's car-making "dream team" has been formed, including many global automotive engineering technology leaders such as MAGNA, EDAG, FEV, AVL, 15 global top manufacturing design masters such as Warming, Michael, Robinson, and the world's top 110 automotive parts leading companies such as Bosch, Continental, and ZF.

“In three to five years, we will become the strongest in the world”

At the Evergrande Auto Base, Xu Jiayin also said:

We want to build Evergrande Auto into the world's largest and most powerful new energy vehicle group within three to five years. This is definitely not a dream!

Liu Yongzhuo, president of Evergrande Auto Group, also made it clear at the Hengchi press conference:

Trial production will start in the first half of 2021, and mass production will be gradually realized in the second half of the year. We are confident that Hengchi will quickly seize the market after its launch.

It is worth mentioning that although Evergrande is a cross-border newcomer in the field of car manufacturing, the president of Evergrande Auto Group is no stranger to cross-border operations and market capture. Liu Yongzhuo also has another title - Chairman of Guangzhou Evergrande Football Club.

I have experience and insights into investing money and achieving results.

However, whether car manufacturing can be as successful as football will have to wait and see the market performance of Hengchi Automobile after it goes on sale.

But Xu Jiayin should be confident. According to Evergrande’s official introduction, Xu Jiayin’s goal for Hengchi is:

"Everyone sees it and everyone wows."