Evergrande’s Electric Vehicle Unit Anticipates Larger Losses

Date: Tuesday

The electric vehicle unit of embattled real estate developer China Evergrande (HK:3333) announced expectations for a larger loss for the first half of 2024, due to increased impairment provisions.

China Evergrande New Energy Vehicle estimated a consolidated net loss of approximately 20.25 billion yuan ($2.84 billion) for the six months ending June 30, compared to 6.87 billion yuan in the same period the previous year.

The EV division, currently in discussions with a potential buyer for a stake in the company, indicated an impairment provision of about 16.74 billion yuan for the half-year.

The company stated, “The company has increased the provision for impairment loss on receivables from the subsidiaries, associates, and joint ventures of China Evergrande.”

In January, a Hong Kong court ordered the liquidation of the property giant China Evergrande Group.

China Evergrande New Energy is set to report its half-year earnings on August 30.

As of the end of 2023, the EV maker had produced only 1,700 of its Hengchi EVs. Production at its Tianjin factory has been suspended since the beginning of this year.

Note: $1 = 7.1237 Chinese yuan renminbi