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The crazy influx of new power car-building enterprises have now suffered a big reshuffle. Boxun Automobile, which established a joint venture with FAW Xiali and obtained production qualification, encountered serious operational difficulties. Huang Ximing, founder of Boxun Automobile, said in a letter on June 13 that due to the actual losses and adverse effects caused by the company's operating problems to all parties, it will strive to lead Boxun Motor out of its predicament.

"it is a great pity that at such a time, in this way, I would like to speak to all my friends who are concerned about the development of Boxun Automobile." Huang Ximing said that Boxun Automobile is currently experiencing serious business difficulties. I deeply apologize and blame myself for the actual losses and adverse effects on the development of employees, shareholders, suppliers, local governments and partners. At the same time, I also decided to continue to take the initiative. To control and recover the actual losses and adverse effects caused to all parties.

In addition to the changes in the market environment, Huang Ximing also attributed the company's financial difficulties to "missing a lot of financing opportunities", causing irreparable losses to the company's cash flow management.

In such a predicament, Boxun Motor decided to reposition the company's business model in order to form results and products, actively cooperate with foreign countries, strive to create positive cash flow, and strive to lead Boxun Automobile out of the predicament. Huang Ximing also hopes to get the understanding of all parties, leaving room and opportunities for fully fulfilling his duties and obligations.

Founded in 2016, Boxun Automotive, formerly known as Advanced vehicle Technology Co., Ltd. (AVT) and Shanghai Sizhi Automotive Engineering Technology Co., Ltd., is engaged in chassis design and vehicle performance development services. After joining the manufacturing of new energy vehicles and the establishment of Boxun cars, Boxun signed an agreement with FAW Xiali in September 2019 to formally establish a joint venture "Tianjin Boxun Automobile Co., Ltd.". The registered capital of the joint venture is 2.54 billion yuan. Boxun contributed 2.034 billion yuan in cash, with a shareholding ratio of 80.1%. FAW Xiali contributed 505 million yuan in assets and liabilities related to land, plant, equipment and so on. The shareholding ratio is 19.9%.

According to the agreement, within 30 days from the date of obtaining the business license, Boxun Motor has to complete the down payment of 1 billion yuan, and the remaining 1.0344 billion yuan must be paid within six months.

However, according to an announcement issued by FAW Xiali on May 28, 2020, Bojun Automobile only paid 14.1 million yuan in currency to Tianjin Boxun. FAW Xiali has sent 2 official letters and 3 lawyer letters to Boxun Automobile, requiring Boxun Automobile to fulfill its capital contribution obligations in accordance with the shareholders' agreement. Xiali stressed that it has the right to terminate the agreement if Bolshund continues to default.

In 2020, the operation problems of Boxun Automobile and Tianjin Boxun, a joint venture company, gradually highlighted, the business of the company came to a standstill, and employees' salary and rights protection incidents occurred frequently. According to media reports, the factory inside the FAW Xiali plant is still at a standstill and has not been put into production since its establishment. Due to the delay in construction, employees in Bo County in Tianjin have only been paid twice, namely in December last year and April this year, and the wages owed in the rest of the month have not yet been paid. In addition, in April this year, it was revealed that more than 200 employees from FAW Xiali to Bo County reported to the Central Commission for discipline Inspection that there were violations of discipline and law in the process of mixed reform of FAW Xiali and Boxian cars.

It is reported that the new company will be led by Zhang Chang, director of human resources, to change the "business model" of Boxun Automobile this time. The new company will acquire the "intangible assets" of the old company (Boxun and Sichi), including talent, data, intellectual property, supply chain, etc., at a lower price, and the old company can obtain funds by selling these assets. After the funds are in place, priority will also be given to the payment of employees' wages in arrears and social security advances. The new company's business may be located in technical consulting, when the subsequent access to more financing, will continue to promote the Boxun vehicle project.

Boxun initially planned two models, the iV6 and the iV7, but the mass production project is a long way off.

The cooperation between FAW Xiali, a traditional car company, and Boxun Automobile, a new power company, may end at a time when the funding problem breaks out, and the road for the new power to build cars is extremely difficult. Before mass production and listing, we will face the fate of reshuffle.

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