Since acquiring the assets of Saab back in 2012, NEVS has started production of the 9-3 sedan at the Swedish automaker’s plant in Trollhättan and even fulfilled its promise to launch an electric version of the car, production of which started just last month. Unfortunately, NEVS has announced this week that a “short term cash problem” on its hands means that it will have to cease production for the time being and layoff some consultants. At the time of the latest announcement NEVS was producing about six cars per day.
NEVS states that one of its current investors, believed to be the investment arm of Chinese city Qingdao, has failed to fulfil its contractual obligation to finance the operations. Qingdao signed an agreement with NEVS late last year to purchase a 22 percent stake in the company for approximately $305 million.
In the meantime, NEVS is relying on its parent company National Modern Energy Holdings Ltd. (NME) as its sole investor. In addition to being used to pay Saab’s suppiers, NME’s funding is also being used by NEVS to build a battery plant in China and set up an R&D facility.
NEVS says that relying on its parent company is only a short-term solution and that a search for new investors is currently underway. NEVS says it has already signed an agreement with a “major international automotive OEM” to help complete development of a new platform called the Phoenix as well as a range of models based on it. Development of the Phoenix platform commenced prior to Saab’s bankruptcy and eventual sale to NEVS.