AIWAYS to ramp up production
If Tesla’s Model 3 production delays have taught us something, it’s that managing car production is not easy. The carmaker needs funding, for sure, but also the experience, tools, space and the right people to produce a car. And this is without considering distribution, sales and marketing.
A mere 2 years ago, the automotive press was reporting almost on monthly basis about the newest EV tech company – Chinese or American – that would disrupt the car industry. In the meanwhile, many of them have disappeared or are still struggling to push their first model to market. Tesla hasn’t been doing so bad after all, right?
Production, production, production
Analysts back in the days predicted that new brands, such as Byton, had little chance of surviving the development-to-production stage; the funding and the know-how were, so they said, not available for stand-alone new companies. Most of the 2016/2017 start-ups should be starting to starting to produce cars about now and it turns out that the pessimists were right.
Tesla’s strategy was a risk, but they have survived all crises until now and even managed to diversify their income streams by focusing not only on the car business, but also on the energy and space industry.
This rather unknown brand was founded in 2017 by a former Volvo Cars executive in Shangrao, Jiangxi. They developed an electric SUV, called U5, that is supposed to become a budget alternative to the electric Tesla, Jaguar, Mercedes or Audi electric SUVs. It goes without saying – as per the press message during this year’s Geneva Motor Show – that AIWAYS will conquer the European market. Only, they have no production and no distribution…
Akin to Tesla, AIWAYS have also developed a fuel cell sportscar with astonishing performance: 0-100 kmh in under 3 seconds and 1200 km of range. Only, it’s not for sale.
Back to reality
So AIWAYS decided to buy a car manufacturer – actually just a car production plant – and paid a bit under USD 250 million for the Jiangling Holding brand. Jiangling is, outside of China, best knows for the cheap looking knockoffs of European cars under the brand Landwind. The company has even been ordered to stop production of their X7 SUV, a Range Rover Evoque copy.
AIWAYS, in a bit of financial trouble itself, is now the proud owner of an almost-bankrupt car manufacturer and hopes to sell cars in China and Europe – as the trade war with the US goes from bad to worse, there’s few chances for AIWAYS to impress the American customer.
Let’s keep an eye open for Changan Automobile, who holds 25% of the former Jiangling brand. Changan has well working joint ventures in place with Ford, PSA, Mazda and Suzuki, is government owned and has cash. Would anyone be surprised if Changan turns out to be the winner of AIWAYS’ ventures?