How hard does Hefei fight for new energy vehicles?

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Welcome to the wechat subscription number of “chuangshiji”: sinachungshiji
By Zhou Xiongfei
Source: lianxianchuxing
In the field of new energy vehicles, Hefei makes another bet.
Recently, 36 krypton quoted sources close to the top management of Zero run automobile as saying that Zero run automobile is conducting a round of pre IPO Financing with a valuation of more than 22 billion yuan. Among them, Hefei municipal government has clearly expressed its investment intention with an investment amount of about 2 billion yuan.
According to the relevant person in charge of Zero run automobile, after obtaining the investment from Hefei municipal government, Zero run automobile will build a second factory in Hefei according to the cooperation agreement. After the factory is officially put into operation, its production capacity will reach the level of 200000 new energy vehicles per year.
This also means that with the completion of this round of investment, Zero run automobile has become the second new energy vehicle enterprise introduced by Hefei after Weilai.
In April last year, when Weilai was in deep trouble and had nowhere to find money, Hefei city invested 7 billion yuan in Weilai’s Chinese entities with the help of SDIC innovation and Anhui high tech industry investment.
Facts have proved that Hefei’s bet on Weilai is successful. One year later, the stock market value of Weilai us has approached us $95 billion, and the return on investment has nearly reached 30 times. Weilai also has its headquarters in Hefei.
U.S. stocks closed today, Weilai stock price and total market value, tuyuan tiger securities
Hefei is determined to seize this air outlet, label it as “the city of new energy vehicles” and seize the opportunity of overtaking on the curve.
After the investment came, Hefei immediately introduced Volkswagen, and promoted the establishment of cooperation with JAC, GuoXuan hi tech and other local enterprises. Subsequently, Hefei industrial investment guidance fund led the investment in the D round financing of Weima automobile. At the end of last year, it introduced Geely production base and Tesla experience center.
Plus Zero run vehicles, so far, Hefei has more than 50 new energy vehicle related industrial projects, such as Weilai, Jianghuai, Chang’an and Geely, and more than 120 upstream and downstream enterprises of new energy vehicle industry, such as Weilai, Jianghuai, GuoXuan hi tech, Huating power and Juyi motor.
For a time, Hefei has become one of the few cities in China that can cover so many enterprises in the complete industrial chain of new energy vehicles, key parts, applications and supporting facilities.
Why does Hefei strive so hard in the new energy vehicle industry? Can it set up a resounding signboard and enhance the competitiveness of the city?
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Is zero run car the second “Weilai”?
“Like Weilai and ideal automobile, we should strengthen the connection with the capital market. We plan to submit IPO documents in the second half of next year, and to be listed on the science and technology innovation board at the end of next year or the beginning of next year.”
At the end of last year, Wu Baojun, the co-founder and President of Zero run automobile, once said so. Zhu Jiangming, the founder and chairman of Zero run auto, also disclosed this view to the media. Now, the process may have begun to accelerate.
According to relevant sources, Hefei’s investment in Zero run vehicles will be completed in two batches. The first 200 million yuan has been invested in Zero run vehicle B round financing, and the remaining 1.8 billion yuan will be invested in pre IPO. According to the data of enterprise investigation, Zero run automobile has completed round B financing on November 11, and the investor is Hefei municipal government.
It can be seen from the amount of investment that most of the capital is invested in the pre IPO, which means that Zero run cars are likely to accelerate to this stage. However, the current situation of Zero run cars is not optimistic.
Zero run automobile was born in December 2015, founded by Zhu Jiangming, former CTO of Dahua, and launched its first mass production vehicle, Zero run S01, three years later. In Zhu Jiangming’s view at that time, the car was positioned as a small sedan, which would have a large market.
Zero car S01, tuyuan Zero car official micro
But the reality is cruel.
After the launch of the vehicle, only about 700 vehicles will be delivered in 2019, far from the planned target of 10000 vehicles. In May last year, Zero run launched its second mass production mini car T03, which has become the sales pillar of Zero run relying on its high cost performance and configuration. However, in the electric mini car market, this car does not have much voice, because in front of it, there are strong competitors such as Wuling Hongguang mini, Oula white cat and Chery ant.
According to the public data of Zero run, the total sales volume of the whole year last year was 11391 vehicles. Compared with the sales volume of Weilai, Xiaopeng and ideal, there is still a big gap. Among the three brothers, the worst performing Xiaopeng cars are 15650 vehicles higher than zero run.
The lack of sales performance brings about the ugly financial data. According to the financial report of its parent company Dahua Co., Ltd., Zero run auto lost 116 million yuan in the whole year of 2019, and lost 42.984 million yuan in the first half of last year. “By October last year, the book value of Zero run automobile had lost 1.65 billion yuan in five years, while the total investment of Zero run automobile was more than 3 billion yuan.” Zhu Jiangming once disclosed to the first electric network.
Now, if Weilai, Xiaopeng and ideal “three brothers” have successfully crossed the “life and death line”, then Zero run cars are still hovering on the “life and death line”. Because of this, Hefei’s investment in and introduction of Zero run vehicles may also be able to save Zero run vehicles, just as it did in the past.
Similar to the past, in 2019, Weilai also fell into the “quagmire”.
At that time, Weilai’s ES6 and es8 cars were just at the time of mass production. However, with the successive spontaneous combustion of vehicles, Weilai had to implement vehicle recall measures, and domestic public opinion also dragged Weilai into the dilemma of not being trusted. At that time, Weilai’s CEO Li Bin became “the worst person in 2019”.
By the beginning of 2020, a sudden epidemic will make Weilai, which is already in the “cold winter” worse.

According to the data released by Weilai, Weilai delivered about 3929 vehicles in the first quarter of 2020, only 759 more than the total sales in December 2019. In addition, by the end of 2019, Weilai’s cash and investment on its balance sheet were less than $150 million, but its total debt was more than $1.15 billion.
The partial sales volume and data of Weilai automobile come from Weilai’s public data, which is connected with travel mapping
For the lack of money in Weilai, many cities have invested olive branches.
In May 2019, Weilai announced that it had signed a framework agreement with Beijing Yizhuang International Investment Development Co., Ltd. (hereinafter referred to as Yizhuang International Investment Co., Ltd.) and obtained a financing amount of 10 billion yuan in exchange for establishing a new entity “Weilai China” in Beijing Economic and Technological Development Zone.
Five months later, according to relevant media reports, Weilai and Wuxing District, Huzhou City, Zhejiang Province are negotiating a financing cooperation of over 5 billion yuan. In exchange, Weilai automobile needs to settle a factory with an annual production capacity of 200000 vehicles in Wuxing district.
But in the end, Weilai chose Hefei.
On February 25 last year, Weilai announced that it had signed a cooperation framework agreement with Hefei city. Weilai China headquarters project will be settled in Hefei. The Hefei government will invest more than 10 billion yuan in the project through designated investment companies and market-oriented investors.
Before that, Weilai also communicated with Hefei municipal government and reached an agreement. According to the agreement, Anhui provincial and Hefei municipal governments will give comprehensive support to Weilai automobile from the aspects of refinancing and industrial landing, while Weilai needs to set up a local headquarters.
Just two months after Weilai announced the establishment of its headquarters in Hefei, Hefei City fulfilled its promise. At the end of April last year, Weilai signed a final agreement on investment in Weilai China with strategic investors such as Hefei Construction Investment Holding (Group) Co., Ltd., SDIC Investment Management Co., Ltd. and Anhui high tech Industry Investment Co., Ltd.
According to the agreement, the strategic investors, mainly Hefei Construction Investment Holding (Group) Co., Ltd., will invest 7 billion yuan in Weilai China. From the perspective of financing scale, this is the largest financing since Weilai’s IPO. On the night of signing the agreement, Li Bin sent a microblog to express his thanks for this.
Li Bin, CEO of Weilai, expressed his thanks on Weibo, and Li Bin’s personal Weibo of tuyuan
In fact, behind this seemingly “tacit understanding and mutual selection”, Weilai and Hefei have already cooperated.
As early as April 2016, in order to achieve mass production as soon as possible, Weilai, who has not obtained the production qualification, signed the manufacturing cooperation framework agreement with JAC in Hefei, officially allowing JAC to produce its models. And between the two, there is Hefei municipal government.
It is on the basis of OEM with JAC that Hefei can “embrace” Weilai again five years later. Under the adverse development of Weilai, Hefei is famous in the field of new energy vehicles.
Although it is not clear whether the Zero run will be the next “Weilai”. But for Hefei, it needs more layout, looking for the next “Weilai”.
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Wide spread and multi layout
Eggs, not all in the same basket.
In the view of the industry, this sentence sums up the layout and investment ideas of Hefei in the field of new energy vehicles. Hefei is investing and signing a cooperation agreement with Weilai. At the same time, it is also making a multi-party layout.
Just one month after Hefei invested 7 billion yuan in Weilai China with SDIC innovation and Anhui Hi tech Industrial Investment Co., Ltd., JAC group announced that JAC Motor Group Holding Co., Ltd. (hereinafter referred to as “JAC holding”) is planning to introduce strategic investors.
Although the identity of the strategic investor was not disclosed in the announcement, in the view of the industry, the war investment of JAC holdings is likely to be Volkswagen Group, which has a deep relationship with JAC, because the two parties had already cooperated three years ago.
As early as June 2017, JAC and Volkswagen Group jointly established a new energy vehicle enterprise, JAC Volkswagen Co., Ltd. (hereinafter referred to as “JAC Volkswagen”), and at the end of December of the same year, the two sides signed a memorandum to plan to establish a light commercial vehicle joint venture.
Announcement on the establishment of JAC Volkswagen
But the cooperation between the two is not going well. Take JAC Volkswagen as an example. So far, the joint venture has only launched a model Sihao e20x, with a price range of 128000-138000 yuan after subsidy. Once it was listed, it was criticized as the “improved version” of the old JAC iev7s, so that the sales volume after listing was flat and there was no sound.
However, this does not affect the re cooperation between the two sides.
On November 25 last year, JAC announced that the issue of the capital increase of JAC Holdings (the controlling shareholder of JAC) and JAC Volkswagen of Volkswagen China had passed the anti-monopoly investigation. This means that after the capital increase is completed, Volkswagen China will hold 50% of the equity of JAC holdings and 75% of the equity of JAC Volkswagen.
According to the cooperation agreement between JAC and VW China, after holding 75% of the equity of JAC, VW China will put into production 4-5 brand products of VW group, giving priority to the production of pure electric, fuel vehicles / plug-in hybrid vehicles in the B-class and C-class segments of JAC Volkswagen.
At the same time with the transformation of VW China into JAC, there is also the former’s holding of GuoXuan hi tech.
At the end of May last year, GuoXuan high tech, a local power battery company in Hefei, announced that Volkswagen China would hold 26.47% of the company’s shares by participating in the fixed increase and transferring some of the company’s shares held by Zhuhai GuoXuan and its actual controller Li Zhen, becoming the company’s largest shareholder.
Volkswagen Group investment GuoXuan high tech announcement, tuyuan GuoXuan high tech official micro
From the participation of the public in the mixed reform of JAC to the holding of GuoXuan hi tech, it seemed to the outside world at that time that the government of Anhui Province and Hefei city were pushing ahead.
Just in 2019, Li Jinbin, Secretary of Anhui provincial Party committee, led a delegation to Barcelona, Spain, and worked with Dr. DESs, chairman of the management board of Volkswagen Group, to finalize the project of building Hefei into a smart city. The participants included Hefei municipal government, JAC and GuoXuan hi tech.
With such a foundation in mind, the cooperation between Volkswagen China and Hefei went further in December last year.

At that time, Volkswagen (Anhui) Co., Ltd. was officially unveiled, and at the same time, the commencement ceremony of Hefei manufacturing base was held. At the ceremony, Volkswagen Group announced that in the next three years, the group would develop models based on MEB platform and new pure electric products in its research and development center in Anhui.
This means that Hefei, Anhui Province, has become another electric vehicle manufacturing base of Volkswagen Group in China, following North and South Volkswagen.
For the introduction of auto companies, Hefei not only focuses on Volkswagen Group, but also Geely.
At the beginning of September last year, Anhui provincial government and Zhejiang Geely Holding Group signed a strategic cooperation agreement in Hefei. According to the agreement, Geely Automobile headquarters R & D base and production base will be located in Hefei, and the two sides will cooperate in automobile lightweight, electrification, intellectualization, networking and sharing.
In the same month, after the investment came, Hefei took a stake in another new energy vehicle manufacturer, Weima automobile.
On the 17th of that month, Weima automobile announced that it had completed round D financing with a value of 10 billion yuan. According to the data of enterprise investigation, one of the leading investors is Anhui Hefei Industrial Fund, with an investment amount of 1 billion yuan. One month later, the Hefei municipal government announced that Yu Aihua, member of the Standing Committee of the provincial Party committee and Secretary of the Hefei Municipal Party committee, held talks with Shen Hui, founder, chairman and CEO of Weima automobile, on the promotion of the project.
Weima automobile D round financing information, screenshot self check
According to relevant media reports, during the talks, the two sides said that they would carry out communication around the new energy automobile industry. Shen Hui also said that Weima automobile should seize the opportunity, start with specific projects, and drive more upstream and downstream enterprises in the industrial chain to settle in Hefei.
When people speculated whether Weima would also “settle down” in Hefei, Tesla also heard the news.
At the end of December last year, the first Tesla experience store in Anhui Province officially opened in Hefei. In fact, Tesla has been a lot late for the experience center in Hefei. Previously, domestic new energy vehicle companies such as Weilai, Xiaopeng, ideal and Weima have set up sales experience centers in Hefei.
From the introduction of Volkswagen Group and Geely Automobile, to the investment in Weima automobile and the introduction of Tesla store, and then to the current investment and introduction of Zero run automobile. In the view of the industry, this series of actions are actually Hefei’s investment and layout in the field of new energy vehicles through “spreading the net widely”.
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Why does Hefei spell like this?
“The provincial capital of isolated island” and “railway cecum”.
For a long time, these two words were the labels of Hefei.
Around 1950, although Hefei was the capital city of Anhui Province, it did not have much advantage compared with other cities in the province. According to relevant data, the population of Wuhu was 250000, Anqing 120000 and Bengbu 100000 at that time, while Hefei had only 70000.
In addition to the population, Hefei also has a slight shortage of resources. At that time, Bengbu City next door had the Beijing Shanghai trunk line, and Wuhu City was also known as the “river city” because it occupied the golden waterway of the Yangtze River. In contrast, Hefei city was inferior.
Because of this, according to the first financial report, even around 2000, Hefei was known as a “big county”. At that time, Hefei’s GDP was only 32.5 billion yuan, ranking more than 80 in the national cities.
In order to change this dilemma, Hefei began to bet again and again.
In the 1960s and 1970s, Hefei poured its resources into the whole city and bet on the University of science and technology of China in exchange for talent resources for the city;
Around 2000, Hefei bet on the home appliance industry through the seemingly radical measures of “building, breaking down violations and attracting investment”. By 2018, Hefei will become one of the three major home appliance manufacturing bases in China;
In 2007, Hefei took out one third of the city’s fiscal revenue to bet on the panel industry and BOE. In the next decade, Hefei has become one of the world’s largest producers of display screens;
In 2011, Hefei took out another 10 billion yuan to bet on semiconductor and Hefei Changxin. Seven years later, Hefei became the birthplace of domestic memory.
Through such bets, Hefei successfully realized “counter attack”. According to the statistics of first finance and economics, Hefei’s GDP in 2019 reached 940.94 billion yuan, almost 30 times that of 2000; its GDP ranking also expanded from 80 to 21 in China.
Top 25 domestic cities in terms of GDP in 2019
In 2014, with the landing of Tesla Model s in the domestic market, a new energy vehicle manufacturing boom was set off in China. For a while, new energy vehicle enterprises such as Weilai, Xiaopeng, ideal and Weima were established like “bamboo shoots after a spring rain”.
For this opportunity, in addition to such “car makers” as Li Bin, he Xiaopeng and Li Xiang, Hefei also sees it.
In 2009, China’s “ten cities and one thousand vehicles” project of new energy vehicles was launched, and Hefei became the first batch of participating cities. In addition, Hefei is also the first batch of double pilot cities for the promotion and application of new energy vehicles in China. According to Hefei daily, in 2013, Hefei ranked first in the national pilot cities in terms of the total amount of promotion in the field of pure electric buses and pure electric cars.
With these advances in new energy vehicles, Hefei has taken measures to bet on Weilai, Volkswagen, Weima, Geely and Zero run vehicles one after another. In addition, in the new energy vehicle related industries, Hefei is also actively in the layout.
For example, after the headquarters of Weilai settled in Hefei, Hefei also took this opportunity to explore the complementary development mode of charging and power exchange, and plans to cooperate with Weilai automobile to build 20 power exchange stations in 2020 and 2021, so as to build a convenient power exchange network across the north and South and East and West in Hefei.
From the investment and introduction of new energy vehicle enterprises to the layout of power exchange network, Hefei has also achieved remarkable results in the promotion of new energy vehicles. According to the public data of Hefei municipal government, 18600 new energy vehicles will be promoted in the first half of 2020, accounting for 4.7% of the total sales in China. By the middle of August, the total number of vehicles promoted in the city had reached 250000, accounting for about 5.5% of the national total.
With this accumulation, Hefei’s “bet” in the field of new energy vehicles went further at the end of last year.

On November 29 last year, Hefei issued the implementation opinions on accelerating the development of new energy vehicle industry. The opinions put forward that by 2025, the scale of new energy vehicle industry in Hefei will exceed 100 billion yuan, the vehicle production capacity will reach 1 million units, the quality brand will have international competitiveness, and it will become an important new energy vehicle industry base in China, and also put forward the plan of building “new energy vehicle city”.
In fact, Hefei, Wuhan, Shenzhen and Xi’an are not the only cities that have proposed to build and become the “new energy vehicle city” at present. In recent years, they have also proposed this goal one after another.
Online travel was published in “subsidies, car companies, resources: who can become the” city of new energy vehicles “? 》This paper expounds in detail the reasons why these cities want to compete for the “capital of new energy vehicles” – not only to drive the economy and industrial upgrading through the manufacturing industry such as new energy vehicles, but also to seize the entrance of the next generation of intelligent terminals.
Because of this, the battle for “new energy vehicle city” among cities has become more and more fierce. In addition, the battlefield has become larger and larger, from new energy vehicle manufacturing, to charging and changing electricity, to automatic driving and Internet of vehicles.
This means that if Hefei wants to win the war, it needs to pay more than the previous bets.
(statement: This article only represents the author’s point of view, not Sina’s position.)