Eliza Wong
The Phoenix Rises: WM Motor’s Bold Comeback Announcement
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Two years after collapsing under massive debt and entering bankruptcy restructuring, WM Motor (威马汽车) has staged a dramatic return to China’s competitive electric vehicle market. The company’s September 6th announcement of a ambitious five-year plan targeting massive production growth and eventual IPO has stunned industry observers and raised serious questions about viability.
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The WM Motor revival plan represents one of the most audacious comeback attempts in China’s automotive history. With confirmed debts exceeding 26 billion yuan ($3.6 billion) and technical capabilities lagging years behind competitors, the company’s declaration of intent to produce 100,000 vehicles within a year and one million vehicles within five years appears extraordinarily ambitious given market realities.
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Behind this resurrection stands Shenzhen Xiangfei Automobile Sales Co., Ltd. (深圳翔飞汽车销售有限公司), a vehicle retail company with connections to the deeply troubled Baoneng Group (宝能集团). Both WM Motor and its new owner face enormous financial challenges that cast doubt on the feasibility of this proposed renaissance.
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Executive Summary: Critical Takeaways
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– WM Motor announced production targets of 10,000-20,000 vehicles in 2025, growing to 100,000 by 2026 and 1 million by 2030, despite having peak sales of only 44,000 units in 2021
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– The company’s revival is backed by Shenzhen Xiangfei, which has invested just 1 billion yuan ($140 million) initially despite massive funding requirements
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– Both WM Motor and Baoneng Group face enormous debt burdens exceeding 500 billion yuan ($70 billion) in combined executed amounts against creditors
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– Technical capabilities remain significantly outdated, with vehicles based on 2018-era 400V platforms versus industry-standard 800V systems in 2025
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– China’s EV market faces severe overcapacity with approximately 2,000 units of production capacity chasing less than 1,000 units of annual demand
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The Ambitious WM Motor Revival Plan
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WM Motor’s comeback strategy, outlined in its Supplier White Paper released September 6th, outlines a three-phase approach to rebuilding the company. The plan begins with resuming production of EX5 and E5 models at its Wenzhou facility, with initial targets of 400 vehicles followed by scaled production.
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The company’s WM Motor revival plan establishes increasingly aggressive targets through 2030. Phase one (2024-2026) focuses on resurrection with production targets of 10,000-20,000 vehicles annually. Phase two (2027-2028) targets 250,000-400,000 units with IPO preparation. Phase three (2029-2030) aims for one million vehicles with 120 billion yuan ($16.8 billion) in revenue.
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Production Targets Versus Market Reality
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WM Motor’s production ambitions appear disconnected from both its historical performance and current market conditions. The company’s peak annual sales reached just 44,000 units in 2021, less than half its first-year target of 100,000 vehicles. By comparison, industry leaders NIO (蔚来), XPeng (小鹏), and Li Auto (理想) delivered approximately 220,000, 190,000, and 500,000 units respectively in 2024.
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The company also plans to launch 10 new models within five years, exceeding its previous product development pace of six models between 2018-2022. This accelerated timeline appears particularly challenging given that contemporary EV manufacturers typically refresh models every 6-12 months in China’s hyper-competitive market.
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Industry analysts have questioned whether the WM Motor revival plan represents a genuine business strategy or primarily serves as a marketing document aimed at reassuring suppliers and potential investors. The white paper explicitly promises early participating suppliers preferential treatment in future production phases, suggesting the company recognizes its need to rebuild relationships throughout its supply chain.
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Financial Foundations: Debt, Funding and Viability Questions
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The financial underpinnings of the WM Motor revival plan raise immediate concerns among credit analysts and industry observers. According to audited financial statements, WM Motor’s total assets amounted to just 3.988 billion yuan ($558 million) against confirmed debts of 26 billion yuan ($3.6 billion), creating a severely insolvent position.
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The company’s proposed debt resolution offers limited immediate relief to creditors. Claims under 150,000 yuan ($21,000) will receive full cash repayment within six months of court approval of the restructuring plan. Larger claims will receive only 150,000 yuan in cash with remaining balances converted to trust beneficiary shares of uncertain value and liquidity.
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Baoneng Group’s Troubled Financial Position
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Shenzhen Xiangfei’s parent company Baoneng Group faces its own severe financial challenges. According to China Executive Information Disclosure Network data, Shenzhen Baoneng Investment Group Co., Ltd. (深圳市宝能投资集团有限公司) faces executed judgments exceeding 50 billion yuan ($7 billion), while Baoneng Automobile Group Co., Ltd. (宝能汽车集团有限公司) has executed judgments surpassing 12 billion yuan ($1.7 billion).
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The initial 1 billion yuan ($140 million) investment from Shenzhen Xiangfei appears insufficient for meaningful revival. Industry analysts estimate that tens of billions of yuan would be required merely to complete the ownership transition and resume basic production operations, with comprehensive revival potentially requiring over 10 billion yuan ($1.4 billion).
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By comparison, leading EV manufacturers invest substantially larger amounts in research and development alone. BYD (比亚迪) spent 54.2 billion yuan ($7.6 billion) on R&D in 2024, while NIO, Li Auto, and XPeng invested approximately 13 billion yuan ($1.8 billion), 11.1 billion yuan ($1.6 billion), and 6.4 billion yuan ($897 million) respectively.
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Market Challenges: Technology, Competition and Consumer Perception
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The WM Motor revival plan faces formidable market headwinds beyond its financial constraints. China’s electric vehicle market has evolved dramatically during WM Motor’s two-year absence, with intensified competition, rapid technological advancement, and changing consumer expectations.
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The company’s planned production restart focuses on EX5 and E5 models utilizing technology platforms developed in 2018. These vehicles employ 400V electrical systems at a time when industry leaders have transitioned to 800V architecture supporting 4C and 5C ultra-fast charging capabilities. This technological gap creates significant performance disadvantages including approximately 80-100 kilometers less range per charge and winter range reduction exceeding 30%.
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Brand Perception and Distribution Challenges
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WM Motor must overcome substantial brand damage accumulated during its financial collapse. The company’s bankruptcy process left numerous suppliers, customers, and dealerships with financial losses, creating skepticism about renewed engagement. Industry sources suggest rebuilding trust may require three years or more, time the company may not have given market conditions.
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The company’s distribution network has substantially deteriorated along with that of Baoneng and Qoros (观致), another automotive brand within the Baoneng ecosystem. Reestablishing national sales and service coverage represents another significant cost component not fully addressed in the current revival plan.
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Zhang Xiang, Secretary General of the International Association of Intelligent Transportation Technology, noted: “During the two to three years that WM Motor has been stagnant, domestic new energy vehicle companies have made considerable progress in intelligent cockpits and assisted driving. Without technical accumulation, it will be very difficult for WM Motor to make a comeback.”
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Industry Context: China’s Crowded and Competitive EV Market
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The WM Motor revival plan emerges within an increasingly challenging automotive market. China’s total vehicle demand has remained below 30 million units annually since 2017, with 2024 apparent consumption reaching only 26-27 million units. Meanwhile, new energy vehicle production capacity has expanded rapidly, creating significant oversupply.
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According to former Ministry of Industry and Information Technology officials, China’s total new energy vehicle production capacity has exceeded 20 million units against annual sales below 10 million units. This supply-demand imbalance has triggered intense price competition with 220 models participating in price reductions during 2024, up from approximately 150 models in 2023.
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Industry Consolidation and Financial Pressures
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Many EV manufacturers continue operating at substantial losses despite growing sales volumes. NIO, XPeng, and Leapmotor (零跑) reported approximate losses of 22.6 billion yuan ($3.2 billion), 5.8 billion yuan ($812 million), and 2.8 billion yuan ($392 million) respectively in 2024.
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An AlixPartners report predicts that of 129 new energy vehicle brands currently selling in China, only 15 will maintain financial viability by 2030. Since 2021, at least 18 new energy vehicle manufacturers have entered bankruptcy liquidation or restructuring proceedings, demonstrating the market’s severity.
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These conditions create particular challenges for the WM Motor revival plan. The company’s historical emphasis on value pricing faces pressure from widespread industry discounting. China Passenger Car Association data indicates that 46.92% of models faced both volume and price decline during the first half of 2025, suggesting even aggressive pricing may not ensure sufficient sales volume for marginal competitors.
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Assessment: Prospects for Successful Implementation
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The WM Motor revival plan faces multiple formidable obstacles including enormous debt burdens, inadequate funding, obsolete technology, damaged brand reputation, and intensely competitive market conditions. Successful implementation would require simultaneous resolution of all these challenges within an exceptionally compressed timeframe.
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The company’s connection to Baoneng Group introduces additional complications given the parent company’s financial distress. While automotive manufacturing represents a strategic priority for Baoneng, the group’s resources appear stretched across multiple troubled investments including previous automotive ventures that have struggled.
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Industry observers note that the 1 billion yuan initial investment and 10 billion yuan total commitment appear insufficient for meaningful competition. Contemporary EV development programs typically require investments ranging from 5-10 billion yuan per all-new model platform, suggesting WM Motor’s funding falls short of requirements for even basic product competitiveness.
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Supplier Response and Supply Chain Challenges
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The white paper’s explicit appeals to suppliers suggest recognition that supply chain support represents a critical success factor. The document promises early participants preferential treatment in future production phases, indicating understanding that relationship rebuilding represents an urgent priority.
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However, many former suppliers face substantial losses from WM Motor’s previous collapse, potentially creating reluctance to reengage without significant financial guarantees or prepayment requirements. The company’s proposed debt settlement terms, offering trust shares rather than cash for larger claims, may further undermine supplier confidence.
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Without strong supplier support, the WM Motor revival plan faces additional obstacles in sourcing components, particularly advanced systems where the company lacks internal capabilities. The automotive industry’s just-in-time manufacturing model makes reliable supplier relationships essential for production stability.
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Forward Outlook: Realistic Scenarios and Market Implications
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The WM Motor revival plan represents either one of the most ambitious turnaround attempts in automotive history or a temporary maneuver to preserve asset value during restructuring. Realistic assessment suggests the latter scenario appears more probable given the multiple challenges outlined.
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The company’s most likely path involves modest resumption of production focusing on specific market niches or regions where competition may be less intense. Such scaled-back operations might utilize existing inventory and supplier relationships to generate limited cash flow while exploring strategic alternatives including potential acquisition by larger manufacturers seeking production capacity.
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Investors and industry participants should monitor several key indicators regarding the plan’s implementation. Meaningful production resumption exceeding a few hundred vehicles monthly would represent initial validation, while supplier recruitment and component sourcing patterns will indicate supply chain confidence. Additional funding announcements beyond the initial 1 billion yuan commitment would signal more serious revival intentions.
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The WM Motor situation illustrates broader challenges within China’s electric vehicle sector, where enthusiastic investment has created massive overcapacity amid slowing demand growth. Successful manufacturers will increasingly require technological differentiation, financial stability, and global market access rather than domestic volume alone.
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Industry consolidation appears inevitable as marginal participants exit or merge with stronger competitors. The WM Motor revival plan, however ambitious, ultimately reflects these broader market forces and the difficult choices facing manufacturers who arrived late to China’s EV revolution.
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For investors and industry observers, the company’s progress will provide valuable insights into whether deeply troubled automotive assets can successfully reinvent themselves in China’s rapidly evolving electric vehicle landscape. The coming months will reveal whether this ambitious revival plan represents genuine corporate resurrection or merely the final chapter in a prolonged decline.
