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On August 6, Kaixin Automobile announced that it would set up a new energy vehicle department and set up a new energy vehicle research and development, production and marketing team. Affected by the news, American stocks rose more than 100% in intraday trading, closing up 89.22% at $3.16, with a total market capitalization of $453 million.

Everyone may be a stranger to Happy car. In fact, Happy car is a used car dealer. Data show that Happy Automobile was founded in 2015, formerly known as Renren Automobile, a wholly-owned subsidiary of Renren Company. Happy Automobile initially entered the used car industry with auto finance business, officially opened the used car retail business in 2017, and became one of the major dealer networks in China's used car market. On May 2, 2019, Happy Motor was officially listed on Nasdaq under the stock symbol KXIN. At this point, Happy Automobile has become the second used car dealer to be listed in the United States after Youxin.

However, happy car life after the launch is not easy. On May 2, 2019, Kaixin Motor officially listed on Nasdaq with an opening price of $3.19 and broke on the same day to close at $2.78. On July 24 of that year, the share price hit $10 for the first time. After entering 2020, the share price of Kaixin Motor continues to fall below the $1 mark. On March 19, 2020, the share price hit an all-time low of $0.41. From March 9 to April 8, the share price of Kaixin Motor remained below $1 for 22 consecutive trading days, within walking distance of being warned.

As we all know, if the stock price of a US listed company is less than $1 and this state lasts for 30 trading days, the listed subject will be warned. if the warned company still fails to take corresponding measures to save itself to change its stock price within 90 days after the warning is issued, it will be announced to stop stock trading.

From the performance point of view, the performance of Happy Automobile is not optimistic. According to the financial report, total income from 2017 to 2020 was $117 million, $431 million, $335 million and $33.16 million, respectively, and the net losses over the four years were $28.695 million, $89.532 million, $69.068 million and $53.32 million, respectively.

In the face of persistent losses, Happy Automobile also began to change and strive to survive in the market with uncertain prospects. In April this year, Happy Motor reached a sales cooperation agreement with imported car e-commerce platform Haitao car and JD.com, and then acquired Haitao car wholly. On June 22, Happy Motors announced negotiations with a leading domestic RV retailer. It is possible to cooperate in RV sales and leasing in the future, and it is also possible to explore opportunities to develop and produce electric RVs. Two months later, Happy Motor announced that it would set up a new energy vehicle department and set up a new energy vehicle research and development, production and marketing team.

In a sense, these three measures do show some benefits, as can be seen in the share price of Happy Motor. After Kaixin announced its acquisition of Haitao, its share price rose 8.05% on April 15 and rose 19.2% on April 26. After Kaixin announced that it would explore the development and production of electric RVs in the future, its share price was also 5.61%. Happy Motors announced that it would enter the new energy vehicle industry, and its share price directly rose 90%.

With the development of new energy vehicles, more and more industries have begun to build cars, including Evergrande, Skyworth, Baidu, Foxconn, Apple, Xiaomi, 360 and so on. However, although the development prospect of new energy vehicles is huge, but the market is still relatively limited, more and more enterprises announce to build cars, the track will become narrower and narrower, then enterprises without capital and technology will be squeezed out of the track. For Happy Automobile, as a used car dealer, it may be able to provide sufficient sales channels for itself after entering the bureau to build cars, but car building is a costly industry, and it is impossible to make a profit in a short period of time. As a second-hand car dealer company that continues to lose money, how should Happy Automobile cut into this track?

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