Kaixin's shares rose about 20 percent in pre-market trading before narrowing to less than 4 percent.
Kaixin Auto Holdings, a US-listed Chinese used car dealership, today unveiled its new energy vehicle (NEV) strategic plan, saying it will rapidly expand its NEV team.
The plan includes three key components, according to the company:
The Company will quickly expand its new energy vehicle team and start with developing medium-sized commercial new energy vehicles for intra-city and inter-city logistics applications in the initial stage.
The production and sales target for the three-year period in 2022-2025 is set at 50,000 new energy vehicles.
Kaixin will accelerate the goal of becoming a leading new energy vehicle company through mergers and acquisitions.
"The new energy vehicle strategic plan was formulated after four months of careful reviews and discussions. The Company is engaged in discussions with multiple strategic investors. Our management team is fully confident in transition into the new business model in 2022!" said Lin Mingjun, Chairman and CEO of Kaixin.
On August 6, Kaixin said it had decided to set up a NEV business unit that will include NEV R&D, production and marketing teams.
The move was based on steady support from the Chinese government for the rapid development of the EV industry and the rapid growth of China's EV sector, the company said, adding that it was in talks with several EV manufacturers about mergers and acquisitions.
On August 26, Kaixin said it entered into a binding investment agreement with local EV maker Henan Yujie Times Automobile Co Ltd to acquire a 100 percent stake in the latter through the issuance of new shares.
Yujie, which makes small multi-purpose electric vehicles, says China will reach 10 million small electric vehicles in five years.
Yujie's factory in Henan province was established in 2017 with an annual production capacity of 150,000 vehicles, which Kaixin says has "a huge production cost advantage.
Two of the company's three small electric vehicles, which are already in commercial production, leverage its innovative core technology, it said.
Kaixin's shares were up about 20 percent in pre-market trading after today's strategic plan announcement, and its current gains have narrowed to less than 4 percent. The stock has fallen 45 percent in cumulative months since September.