The manufacturing center of HiPhi, situated north of Shanghai, has decided to cease production immediately, with plans for a temporary shutdown lasting six months. This decision, rumored in Chinese media, has now been confirmed through an internal memo received by the employees.
During this hiatus, access to the facility in Yancheng is strictly prohibited. The employees will not receive their January wages until the end of February. Additionally, payment dates for salaries from February 1 to February 18 remain undecided.
Employees opting to stay with the company between February 18 and March 18 will receive 70 percent of their salaries. Beyond March 18, those who choose to remain will only receive a minimum wage.
Furthermore, employees have been instructed that they must resign before February 25 to handle their social security payments. All year-end bonuses have been canceled as well, as outlined in the email from Human Horizons, the company behind the HiPhi premium brand, known for its futuristic models like the HiPhi Z.
The production center, formerly Dongfeng Yueda Kia’s First Plant, halted operations in June 2019. It was repurposed to produce HiPhi vehicles, with the first HiPhi X rolling off the line in November 2021.
The plant, with a capacity of 150,000 vehicles annually, manufactures three models: HiPhi X, Y, and Z, with the performance-oriented A scheduled for release soon.
While sales figures have shown slow growth over the past three years, with 4,237 electric cars sold in 2021, 4,349 in 2022, and 4,829 in 2023, the most popular model remains the entry-level SUV HiPhi Y, starting at 339,000 yuan ($47,094).
The HiPhi X SUV and Z sedan, starting at over 600,000 yuan, are sold in Europe at significantly higher prices, making them less competitive in that market. This trend is noted by Car News China, which reported HiPhi’s closure of stores in Chengdu and Guangzhou, reflecting the struggles of small EV manufacturers amidst a slowing EV market in China.