Thunderstorm! Shanghai new forces were reported by all employees.

Another new force thundered!

On April 9, Youyao Automobile issued a notice to shareholders on the social platform, and employees used thousands of words to expose the current business crisis faced by Youyao Automobile and a series of serious problems recently. According to the shareholders’ notice, Devin Lu, the chairman of Youyao Automobile, and He Jianghao, the chief financial officer (hereinafter referred to as the management) are suspected of falsifying sales, concealing the truth, making wrong decisions, and having chaotic management.

The shareholders’ notice shows that there are five major problems in Youyao Automobile at present: the company’s strategy is chaotic and its objectives are unclear; The sales business developed well but was forced to stop production and sales; The financing is not ideal, and it is suspected that the sales volume is falsely created to support the financing; Financial management is chaotic, and the payment for goods is stopped across the board, which leads to a run on suppliers; Stop paying all employees’ salaries for no reason, and violently lay off the company;

Employees said that the company had never formulated clear goals and plans that conformed to the market rules, which caused the company’s production and sales to fluctuate greatly, resulting in a lot of waste of resources. By the end of 2023, the company’s cash flow was close to breaking. According to the shareholders’ notice, at present, Youyao Automobile’s overall external debt exceeds 300 million, and its asset value is less than 100 million, which is seriously insolvent.

What is even more shocking is that in order to achieve the sales target, the management fictionalized the sales data that did not conform to the actual market rules, and deceived investors and shareholders for the purpose of financing. In fact, the management did not confirm the sales target with the sales team, which led to the overall abolition of the global sales team, and at the same time stopped production and payment to suppliers on the grounds of "tight cash flow". When the company was facing the crisis of survival, the management did not start to solve the problem, but began to lay off employees and stop paying, and employees did not get any economic compensation. Nowadays, Youyao Automobile has reached the end of the road, not only can’t pay the salary, but even the office rent can’t be paid, while the management only focuses on how to cash out the existing inventory cars, and all business is forced to stop.

At the end of the notice to shareholders, the employee’s handprint and signature are attached. The employee wrote: "We are very sorry about the current state of the company. All employees believe that shareholders have the right to know the truth."?

Who is Youyao Automobile? According to the data, Youyao Automobile is an electric vehicle brand of Shanghai Co., Ltd., which was established in July 2018. Former high-level Lu Bin also joined the company as a co-founder. From the perspective of development time, Youyao Automobile is also a member of China’s new power, but unlike the mainstream new power brands, Youyao Automobile Development Center is mainly concentrated in overseas markets, especially in Europe.

It is understood that the management of Youyao Automobile almost comes from traditional automobile companies. Rudy, the founder and chairman, helped to build a design center in Italy. At that time, he was also a minor celebrity in the design industry. After 12 years of service, he left and founded XEV Youyao Technology, a new energy vehicle technology company. Co-founder Lu Bin worked in SAIC-GM, Geely, and before entering Youyao Automobile, he was the co-founder, senior vice president and chief travel officer of Weimar Automobile.

Unlike automobiles and automobiles, Youyao Automobile has a particularly fast mass production time and achieved good results in a short period of time. In the same year that Youyao Technology was founded, the first model of Youyao Automobile was unveiled at the auto show, and mass production was realized the following year.

Why can Youyao Automobile achieve such a fast mass production speed? First of all, YOYO is a pure electric small car. The door, front face and tail can be realized by 3D printing, and the interior of the vehicle can be printed according to the user’s needs to achieve high customization. Secondly, with the support of the government, XEV Youyao Technology established a joint venture company with Hefei government in 2020 to comprehensively carry out R&D, production and vehicle export business.

In May, 2021, YOYO exported to European cars, with a retail price of 13,900-15,900 euros. Although YOYO’s cruising range is only 150km, and its top speed is only 80km, it is not competitive at present, but compared with the same level, the price of YOYO does have an advantage, plus it has frameless doors, skylights, car-machine interconnection and other configurations that are not available in many models of the same price. YOYO will explode in the European market in the short term. It is understood that YOYO’s sales reached 10,000 vehicles in the year of listing, becoming the best-selling new energy vehicle brand in the European market that year.

Made in China and sold abroad, the sales volume is not bad. Youyao Technology seems to have stepped out of a path different from the new forces in China, but behind a number of prosperous companies, there are some situations such as false sales volume and chaotic management, and so on, and it has come to an end step by step.

After January 2024, the management stopped factory production on the grounds of the company’s tight cash flow, and completely stopped supporting overseas channel development, resulting in a large number of customers losing. Subsequently, the company made several rounds of layoffs, and the laid-off employees were not compensated, which aroused strong dissatisfaction among employees, and employees in Shanghai and Hefei began to defend their rights according to law. Up to now, the management has not appeared to communicate with employees and explain the situation.

As a member of "traditional car enterprise executives start their own businesses to build cars", there is another case of failure. It is understood that the official Weibo update of XEV Youyao Automobile has stagnated a year ago, and many netizens have asked when they will return to China. Now, I am afraid that they will not come back.