Rumor mill in overdrive as HiPhi tries to keep moving

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HiPhi is currently in a fight for its life and rumors about the company’s past, present and future swirl around. The company has already stopped production ostensibly for six months but it is highly unlikely it will resume without a major change.

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At an internal meeting earlier this month HiPhi CEO and founder Ding Lei confirmed the rumors surrounding HiPhi’s financial problems and apologized for not being able to beat the Internet with his old-fashioned business strategy. He said that the window for turning HiPhi around is at most three months, and he will actively strive for it, and is already carrying out financing matters.

This likely comes in two forms firstly and most optimistically finding a buyer for the company. The second is to simply find a company to take over the aftersales service and rights for existing owners of HiPhi cars.

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A rumor began circulating a few days ago that Huawei was going to buy HiPhi to create a second Seres. Huawei has now responded to this saying it is fake news.

On February 23  HiPhi addressed various rumors in a live broadcast on Douyin, China’s TikTok. Yang Yueqing, engineering project director of HiPhi, said in the broadcast that the company’s senior management has not run away, and is still working hard for the company and all users.

Yang Yueqing in the broadcast addressing HiPhi rumors

The knives appear though to be out for HiPhi. Faraday Future founder and LeEco founder Jia Yueting wasted no time weighing in and calling HiPhi the shame of the industry and repeating accusations that the company stole the designs for the FF91 to produce the HiPhi X. It should be noted that Faraday Future only managed to deliver three FF91 cars after spending 3 billion USD over nine years.  

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Ding Lei once held an important position in LeTV Automobile (part of LeEco), and then left to found Human Horizons, and launch the HiPhi brand.

It seems Jia Yueting has not forgiven Ding Lei. Rumor has it that Ding Lei took the core team and the full set of FF 91 design data with him when he left LeEco, resulting in the appearance of the HiPhi X being highly similar to the FF 91 from Faraday Future.

HiPhi’s Yang Yueqing refuted the allegation in a broadcast saying “We did not copy anyone, all engineers, original manuscripts, drawings and patents are in Shanghai Pujiang Park.”

HiPhi currently has three models on sale the dual flagship X and Z models along with the more mass market Y. Both the Z and Y only went on sale last year but sales of the Y particularly have disappointed. Sales in 2021 were 4,237 while in 2022 there was small increase to 4,349. With the two new models 2023 things should have been much better but sales are now known to have been 8,681.

Editor’s note:

Huawei would have made a good buyer for HiPhi. One of HiPhi’s biggest product weaknesses is that they don’t have anything particularly convincing when it comes to ADAS. Huawei essentially provides a plug and play full stack system. There is still hope that another company may step in but the longer it takes the more likely it is that HiPhi production will never resume. Perhaps Jia Yueting should make an offer for the company and actually get some sales rather than complaining.

By the beginning of March only 1 store out of 6 will remain open in Beijing and other cities are seeing similar closures. However, many might say that is one too many as it would take a very brave buyer to purchase a HiPhi today with such uncertainty over the company’s future. Chinese sources show that you can currently pick up a HiPhi Z for around half the list price.

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