Luxeed is currently promising wait times of 10-12 weeks, which is long enough to change consumer buying decisions.
(Image credit: Luxeed)
Luxeed, the new electric vehicle (EV) brand jointly created by Huawei and Chery, is facing delivery challenges with its first model, the S7, potentially derailing the model's prospects.
As of January 20, Chery's Plant 2 in Wuhu, Anhui province, dedicated to producing the Luxeed S7 was still in pilot production, with fewer than 10 vehicles rolling off the assembly line in a single day, local media outlet LatePost reported today.
At this rate, the plant could still take several months to prepare for mass production, the report noted.
As a transition, the Luxeed S7 had been produced at Chery's Plant 1, but now the model's daily production at this plant has dropped to less than 20 from around 100 units last month, according to the report.
This has exacerbated the Luxeed S7's delivery difficulties, with salespeople promising delivery times that have been delayed to 10 to 12 weeks from an initial minimum of four to six weeks, LatePost said.
Richard Yu, head of Huawei's automotive business, launched the Luxeed S7, the first sedan the Chinese tech giant built with a local carmaker, at a November 28 launch event in Shanghai.
The Luxeed S7 is an all-electric mid-to-large-size sedan model available in four variants with starting prices of RMB 249,800 ($34,840), RMB 289,800, RMB 319,800, and RMB 349,800, respectively.
The model went on pre-sale on November 9, and Yu said in the launch that there were more than 20,000 pre-orders as of the official roll out.
Slow deliveries have sparked complaints on social media, and on January 15, Luxeed said on Weibo that the factory was working at full capacity to produce the model, and that it would offer a subsidy of up to RMB 10,000 to customers if their deliveries are delayed.
Luxeed is currently promising a wait time of 10-12 weeks, which, judging from the experience of other car brands, is a long enough wait to change a consumer's purchasing decision, LatePost's report today noted.
As planned by Huawei and Chery, the Luxeed S7 will be built at Chery's new Plant 2, with a planned annual capacity of 500,000 units. The first new cars of the model rolled off the line here before its official launch.
The new plant is still in the pilot production stage, and there are still a number of issues to be resolved, including equipment commissioning and staff recruitment, LatePost quoted an insider as saying.
It is now approaching China's Spring Festival holiday, making it difficult to recruit workers, and mass production now is almost impossible, the source said.
Chery will send employees from other factories to support the new plant, but it is expected to wait until after the Chinese New Year. That won't happen until April, an employee at that new plant said, according to the report.
The Plant 1 is separated from the Plant 2 by the Yangtze River, and the Luxeed S7 was scheduled to produce around 100 units in a single day in late December, according to LatePost.
However, as a transitional solution, Plant 1 was unable to focus on ramping up production of the Luxeed S7, with daily production of the model in the plant shrinking to around 20 units per day last week and just over 10 units per day this week, according to the report.
Production of the Luxeed S7 at Plant 1 is scheduled to cease shortly, the report noted.
($1 = RMB 7.1701)