The Evergrande Group, a Chinese real estate group that is one of the largest in the world, has gone all in on electric vehicles with a $23 billion investment in electric car and battery production.
If you have followed electric vehicle news for a while, then you should know that the Evergrande Group is no stranger to electric cars. Evergrande was a big investor in the electric startup Faraday Future and in the ensuing financial fallout where Faraday Future CEO, Jia Yueting, claimed that payments were not made to Faraday Future. Evergrande had also acquired 51% of Saab successor National Electric Vehicle Sweden (NEVS).
In addition to those investments, Evergrande has set up a partnership with Koenigsegg for vehicle research as well as acquired Shanghai Cenat New Energy Co to purse advanced battery technology.
With these partnerships and new technologies in tow, Evergrande seems to be very confident in entering the electric vehicle market.
Evergrande aims to invest 160 billion yuan in Guangzhou’s Nansha district to set up three major bases for new energy vehicles, according to a statement the Nansha local government sent to the Global Times Wednesday.
One of the bases will have the capacity to manufacture 1 million vehicles annually. The other two bases will be able to produce as much as 500 GWh of batteries annually and electric motors and electronic control systems to equip the 1 million electric cars, the statement said.
While most startups aim to gradually ramp up the annual production of their vehicles, Evergrande seems to be very confident in their production capacities. While it is certainly not unheard of for an automaker to produce 1 million cars annually, it is hard for all those cars to come from only one factory. Take for instance Volkswagen’s Wolfsburg Plant, it is the largest car factory in the world and they only managed 815,000 vehicles in 2015. Perhaps the official plan will call for multiple factories, but that is left for us to see.
Additionally 500 GWh of batteries is actually just unheard of. Take for instance LG Chem, one of the largest battery producers in the entire world. Their total annual production target in 2020 is 90 GWh. How Evergrande is planning to produce over five times the battery cells is beyond me. $23 billion is certainly a lot to throw around especially when doing so in your home country, but I just do not know how they’ll do it.
Regardless, electric vehicle competition grows hotter by the day especially in China.
What do you guys think the chances are of Evergrande reaching their goals? Let us know down in the comments below.
Source: Global Times