HiPhi looks to be the latest casualty from the increasingly-crowded EV marketplace in China.
The overcrowding of the EV marketplace in China and its ensuing brutal price waris looking like it has claimed yet another victim, as HiPhi recently has shutdown production for six months with immediate effect amid a capital crunch. This drastic action comes after a leaked internal company memo surfaced online just before Chinese New Year showing for the Shanghai-based automaker to be withholding wages of its 5,000 employees for the first month of the year until the end of February, with all year-end bonuses canceled and all salaries reduced.
Trouble at HiPhi however begun brewing late last year already, with rumours picking up steam in January alleging for R&D work at the automaker to have since stopped. Speculations of the company’s financial state was then further fuelled by the marque having also since shuttered its Chengdu and Guangzhou stores in late January.
In the face of its potential collapse, HiPhi has nevertheless attempted to put on a brave face by stating that it is giving itself three months to perform a turnaround. Though with the best will in the world, the chances of this automaker making it through to the end of this year is looking slim at best.
This is especially when considering that while EV sales in China are expected to still continue growing this coming year, many are predicting its pace will slow from the burgeoning 37% year-on-year increase of 2023, to a more modest 20% this year. This slowing growth therefore will likely not just see HiPhi go the way of 15 other automaking start-ups that have since bit the dust in recent time (WM Motor, Enovate, Singulato, and Aiways etc.), but more so for the corporate death count to only continue climbing in the coming 11 months.
Now just for those who haven’t heard of HiPhi, this brand is a luxury subsidiary of Human Horizons and is perhaps best known for its top-end all-electric offerings that look straight out of Cyberpunk. There are currently three models in its lineup: the HiPhi X flagship large e-SUV, the slightly smaller HiPhi Y mid-sized crossover and the Taycan-rivalling HiPhi Z fastback, with the company also recently showcasing its four-door 1,200+ hp hypercar known as the HiPhi A.
More interestingly though about this company in this context of it potentially going bust is that it is to be among the few Chinese automakers to have actually sold cars outside of its domestic market, with it having made its debut over in Norway back in late 2022. In fact, its Z recently made waves in the global EV news by outperforming all its competitors in an extreme-cold range test conducted over there.
What more is that HiPhi had also previously managed to secure the financial backing of the Saudis, with its parent company inking a partnership agreement with the Saudi Arabian investment ministry back in May last year for plans to manufacture its models over there to the tune of $5.6 billion (RM 26.75 billion). It currently remains to be seen as to what will happen with this deal moving forward.
