FAW Bestune to raise funds through capital increase for new energy vehicle development

Beijing (Gasgoo)- According to the announcement from the China Beijing Equity Exchange, FAW Bestune Car Co., Ltd., a subsidiary of FAW Group, intends to introduce external investment through a capital increase, with a minimum fundraising target of 165 million yuan. 

B70; photo credit: Bestune

After the capital increase, the combined shareholding of the original shareholders and FAW Group member companies, who will participate in the non-public agreement-based capital increase, will not be less than 97%. The shareholding of the investor introduced through the China Beijing Equity Exchange will not exceed 3%, and the disclosure period will end on August 14 this year.

The funds raised from this capital increase will be primarily used to supplement the working capital and support the development and market promotion of Bestune's new energy vehicles. As previously disclosed, in order to promote the transition towards being a new energy vehicle-oriented company, Bestune plans to launch five new energy vehicle models, including A00-segment electric vehicles, between 2023 and 2025.

The announcement also revealed Bestune's recent business performance. From 2020 to May this year, although Bestune's net loss has been narrowing, the accumulated losses over the past three years have reached 11.71 billion yuan. The continuous losses are attributed to the sluggish sales. Since 2020, Bestune's sales have been declining, with an annual volume of only 61,000 units sold in 2022, which was approximately half of the figure in 2019.

In May 2021, Bestune set a target to achieve a brand strategic transformation and reach annual production and sales of 300,000 vehicles by 2023. It further aims to achieve an annual output and sales volume of 600,000 units by 2024-2025 and challenge the one million unit sales scale. However, the data for May 2023 revealed that Bestune's flagship model, the Bestune B70, recorded a sales volume of only 2,828 units, while the Bestune NAT and the Bestune T77's numbers reached only 1,318 units and 845 units.