Nezha Auto’s parent company, Hozon New Energy Automobile Co., Ltd. (Hozon New Energy), has unveiled a restructuring plan that includes a significant investment and a phased approach to resuming production and expanding its global reach. The announcement came during the fourth creditors’ meeting for Hozon New Energy’s bankruptcy restructuring case, held online on September 11.
Key Investor and Funding Details
The restructuring plan identifies Zhejiang Taiyi Shenglian Enterprise Management Partnership (Limited Partnership) as the proposed restructuring investor. This entity plans to inject 3 billion RMB into Hozon New Energy. Out of this amount, 1.167 billion RMB will be allocated to settle debts related to retained assets and cover bankruptcy expenses. The remaining 1.833 billion RMB will serve as working capital to support the company’s operations and development post-restructuring. In return for this investment, Taiyi Shenglian is set to acquire approximately 70.62% of Hozon New Energy’s equity.
Phased Development and Production Plan
Hozon New Energy’s future development strategy is outlined in three distinct phases:
Phase 1: Resuming Production and After-Sales Service
The initial focus will be on resuming production of the Nezha X model, with a target of 10,000 units annually. This phase will primarily target overseas markets. Simultaneously, the company aims to rebuild confidence with upstream supply chain partners, ensure the supply of official spare parts, and fully restore after-sales maintenance services for Nezha Auto owners. The existing service network will be reactivated to provide official maintenance services.
Phase 2: Expanding Market Reach
The second phase will concentrate on launching new models specifically designed for markets in Asia, Africa, and Latin America. The production target for this phase is set at 300,000 units per year.
Phase 3: Global Expansion and IPO Preparation
The final phase involves developing global intelligent vehicle models, aiming for an annual output value of 40 billion RMB. This phase will also lay the groundwork for a potential Initial Public Offering (IPO).
Nezha X Model Background
The Nezha X, a compact SUV, was initially launched in October 2023. Before its production halt, it was priced between 89,800 RMB and 124,800 RMB. The model was a key vehicle for Nezha Auto’s export strategy.
This restructuring marks a critical juncture for Nezha Auto as it seeks to overcome recent financial challenges, including reports of significant financial losses and its founders being listed as defaulters.
