According to the news on Ekonomim.com; The new generation Chinese electric car manufacturer Human Horizons HiPhi, unlike many of its competitors, has not been able to reach high sales figures by focusing on the premium segment. In recent months, it announced that it would be pausing production for six months. At the time, it was reported that the company had been experiencing cash flow problems for a long time. The company, which was on the agenda with late salaries, canceled bonuses and executive salary cuts, was also in serious danger of bankruptcy.
REQUESTED RESTRUCTURING
The company filed for pre-bankruptcy restructuring due to financial difficulties. The application was submitted to the People’s Court in East China’s Yancheng city and declared that it is unable to pay its debts as of April 2024.
The court announced that Human Horizons had met the conditions for restructuring and would appoint an administrator to oversee the process. It was stated that the process would initially take six months but could be extended for another three months if necessary.
HOW DID IT COME TO THIS POINT?
The company stopped production in February 2024 due to economic difficulties and low sales figures in recent months. The company was forced to close its stores, could not pay suppliers and was able to deliver only less than 8,000 luxury electric vehicles in 2023.
The financial crisis experienced by the HiPhi brand also reveals the difficulties in the Chinese automobile market. The end of government-backed electric vehicle subsidies in 2022 and the general economic recession have reduced consumer demand. Many automobile brands have entered into price competition, which has also caused smaller players to experience a crisis.
