Chery to Take Over HiPhi’s Yancheng Plant? Yueda Denies, But Demolition Work Spotted On-site

On April 10, 2025, Jiangsu Yueda Automobile Group Co., Ltd. issued a statement clarifying that recent online rumors claiming “Chery Automobile has fully taken over HiPhi’s Yancheng plant” are false. The company stated that Yueda Kia’s Plant No. 1 had previously been leased long-term to Human Horizons Technology Company for the production of HiPhi vehicles, and that ownership of the factory has not changed—therefore, it has not been taken over by Chery. Yueda Kia’s Plant No. 1, located in Yancheng, Jiangsu Province, began operations in 2002 with an original annual production capacity of 140,000 vehicles. Due to Kia’s continuous sales decline in China since 2017, the plant ceased vehicle production in 2019 and was later retrofitted and leased to HiPhi for new energy vehicle manufacturing. HiPhi, founded by Ding Lei, launched its first model, the HiPhi X, in 2020, followed by the HiPhi Z and HiPhi Y. However, the brand encountered operational difficulties starting in 2023. Its parent company, Human Horizons (Jiangsu) Technology Co., Ltd., filed for bankruptcy in August 2024 and was ordered by the court in mid-2025 to undergo substantive consolidation and restructuring. In May 2024, Jiangsu HiPhi Automobile Co., Ltd. was established as a joint venture between Lebanon-based EV Electra Ltd. (holding 69.8%) and Human Horizons (Jiangsu), aiming to maintain the Yancheng plant’s annual capacity of 150,000 vehicles and initiate environmental assessments for resuming production. However, as of 2025, EV Electra’s promised $100 million investment has yet to materialize, hindering restructuring progress. In January 2025, the bankruptcy administrator released a “Draft Restructuring Plan,” outlining a clear path for resuming production and after-sales service arrangements. Meanwhile, some media outlets reported that Chery Automobile was demolishing and renovating the HiPhi Yancheng plant (formerly Yueda Kia Plant No. 1) for use in producing export models. On-site investigations by reporters revealed construction workers on site and vehicles entering and exiting the facility. One staff member claimed, “It’s true that Chery has taken over—it’s currently dismantling equipment.” However, Yueda Automobile Group explicitly denied any change in factory ownership. Chery Automobile has demonstrated strong export performance in recent years, exporting 1.34 million vehicles in 2025 and accumulating total exports of 5.85 million units, maintaining its position as China’s top passenger vehicle exporter for 23 consecutive years. The company has recently accelerated its overseas expansion, including investing in a new plant in South Africa (expected to commence production in 2027) and launching its European operations center and a research institute in Spain.