Eliza Wong
WM Motor Emerges from Bankruptcy with Ambitious Revival Plan
China’s electric vehicle landscape witnesses a dramatic development as WM Motor (威马汽车), once among the country’s most promising EV startups, emerges from nearly three years of financial collapse. The company’s official announcement through its WeChat channel reveals a comprehensive restructuring plan backed by Shenzhen Xiangfei Auto Sales Co., Ltd. (深圳翔飞汽车销售有限公司), a company linked to the embattled Baoneng Group (宝能系). This WM Motor revival represents one of the most ambitious comeback attempts in China’s increasingly competitive new energy vehicle sector.
Three-Phase Recovery Strategy
The company outlined a detailed three-phase recovery strategy: – Phase 1 (2025-2026): Resume production of EX5/E.5 models with target of 10,000-20,000 units annually – Phase 2 (2027-2028): Scale production to 250,000-400,000 units with advanced driver assistance systems – Phase 3 (2029-2030): Achieve 1 million units annual production and 120 billion yuan revenue target
Government and Supplier Support
The Wenzhou municipal government has established a special task force to support the WM Motor revival, coordinating with local suppliers and financial institutions to facilitate the restructuring process. According to the company’s announcement, 215 historical suppliers have been contacted with most expressing willingness to continue cooperation.
Baoneng Group’s Controversial Involvement
The WM Motor revival hinges on support from Shenzhen Xiangfei Auto Sales Co., Ltd., which shows direct connections to Baoneng Group through shareholding structures. Huang Jing (黄晶), the actual controller of Xiangfei Auto, holds 46% ultimate beneficial ownership in Kunshan Baoneng Auto Co., Ltd. (昆山宝能汽车有限公司), creating clear links to the troubled conglomerate.
Baoneng’s Financial Troubles
Tianyancha data reveals concerning financial realities: – Shenzhen Baoneng Investment Group Co., Ltd. (深圳市宝能投资集团有限公司) has accumulated enforcement actions exceeding 45 billion yuan – The group faces multiple debt crises and liquidity challenges – Questions remain about sustainable funding capacity for the WM Motor revival
Initial Investment Commitments
Xiangfei Auto has committed an initial 1 billion yuan investment toward equipment upgrades, supply chain restoration, and product development. The company has assembled a 143-person professional team combining Xiangfei employees and former WM Motor staff, with plans to expand to 400 core team members.
The Original Collapse: From EV Pioneer to Bankruptcy
WM Motor’s fall from grace represents a cautionary tale in China’s EV development story. Once celebrated as one of the “Four EV Dragons” alongside NIO, XPeng, and Li Auto, the company’s decline resulted from multiple strategic missteps and operational challenges.
Financial Mismanagement
The company’s financial deterioration was severe: – Total losses of 17.4 billion yuan between 2019-2021 – Negative net assets of 20.536 billion yuan by end of 2021 – Despite raising over 41 billion yuan in funding, cash burn remained unsustainable
Product and Safety Issues
WM Motor faced significant product quality challenges: – Multiple incidents of vehicle spontaneous combustion raised safety concerns – Controversial “battery locking” practices damaged consumer trust – Reports of braking failures and power system problems further eroded confidence
Failed Capital Market Strategies
The company’s inability to complete successful IPOs on A-share, Hong Kong, or US markets (including attempted backdoor listing through Happy Car) severely limited additional funding options and undermined market confidence.
Market Challenges for the WM Motor Revival
The competitive landscape has dramatically shifted during WM Motor’s hiatus. China’s EV market has evolved into a brutally competitive environment where scale, technology, and capital determine survival.
Intensified Competition
Current market dynamics present severe challenges: – BYD and Tesla dominate market share with increasing margin pressure – NIO, XPeng, and Li Auto have strengthened their market positions – Huawei’s Harmony Intelligent Driving Alliance and Xiaomi Auto represent new competitive threats – Price wars have become常态化 (normalized) throughout the sector
Product Relevance Gap
The planned restart with EX5 and E.5 models creates immediate challenges: – These models represent outdated technology compared to current market offerings – Two-year development gap requires significant catch-up in features and performance – Consumer expectations have advanced considerably in connectivity and autonomous driving capabilities
Brand Rehabilitation Challenges
Perhaps the most difficult aspect of the WM Motor revival involves rebuilding consumer trust. The company’s previous collapse left thousands of customers with unresolved service issues and maintenance concerns.
Legacy Customer Relations
The brand damage from previous practices remains significant: – Extended service interruptions created frustration among existing owners – “Battery locking” controversy generated lasting consumer resentment – Rebuilding credibility requires transparent communication and substantial goodwill gestures
Market Perception Hurdles
Industry analysts note that rehabilitating a damaged brand often proves more difficult than launching a new brand entirely. The WM Motor revival must overcome deeply negative associations while demonstrating fundamentally improved products and services.
Strategic Implications and Future Prospects
The WM Motor revival attempt represents more than just one company’s struggle—it reflects broader themes in China’s EV development including industrial policy, capital allocation, and market consolidation.
Broader Industry Context
Several factors make this revival attempt particularly notable: – Government support indicates continued commitment to EV sector development – Production capacity and manufacturing credentials retain value despite financial troubles – Market consolidation may create opportunities for repositioned entrants
Realistic Assessment of Prospects
Most industry observers remain skeptical about the ambitious targets: – The 120 billion yuan revenue target for 2030 appears exceptionally ambitious – Current market conditions favor established players with scale advantages – Funding requirements for the full revival plan likely exceed available resources
Path Forward for WM Motor’s Ambitious Return
The WM Motor revival represents one of the most dramatic second-act attempts in China’s automotive history. While the ambition is commendable, the practical challenges appear formidable. The company must navigate immediate obstacles including outdated products, damaged brand reputation, and questionable financial backing while operating in an increasingly competitive market. Success will require not just adequate funding but also revolutionary products, rebuilt trust, and exceptional execution. The coming months will reveal whether this revival attempt represents genuine transformation or merely the final chapter in a prolonged decline. For investors and industry observers, the WM Motor story offers crucial lessons about capital intensity, technological pace, and market dynamics in China’s EV sector. The company’s fate will provide valuable insights into whether second chances are possible in an industry characterized by relentless innovation and unforgiving competition.
