On February 3, when the industry's attention was focused on FAW or about $7.2 billion to buy brilliance China, an inconspicuous piece of news quietly appeared on the front page of an official website called Silk-FAW on the same day.
Silk EV, an international automotive engineering company, and FAW, China's largest automaker, have formed a joint venture with a total investment of 1 billion euros to develop and produce a series of ultra-luxury, high-performance and new energy sports cars for the Chinese and global markets.
"(working with Silk EV) for supercars." Some FAW Group insiders gave a brief explanation of the cooperation between the two sides. As of press time, FAW Group has not confirmed this press release.
Behind Silk EV is KraneShares (Jin Rui Fund), which is controlled by China International Capital Corporation, and just five days before Silk EV unilaterally announced the establishment of a Silk-FAW joint venture, IDEX.US announced that it would invest 15 million US dollars in Silk EV.
Jinrui Fund surfaced
According to the official website of Silk-FAW, the Silk-FAW joint venture plans to launch new pure electric and hybrid red flag brand S-series models, the first of which will be the ultra-luxury supercar Red Flag S9. According to the plan, the first model of the Silk-FAW joint venture will be designed and produced in Regione Emilia-Romagna, Italy, where Silk EV is headquartered, and then, with the development of the Red Flag S series, it will be produced in both Italy and Changchun.
Public data show that, Silk EV was officially established in 2019 after contact with FAW, headquartered in New York, USA, is an electric car start-up company. On April 29th, 2019, Silk EV registered Silke Technology (Shanghai) Co., Ltd. in Shanghai Free Trade Zone, specializing in the opening and transfer of technology in the fields of new energy technology, automotive technology, network technology, intelligent technology, etc.
LinkedIn, a social networking site, further introduced Silk EV, a start-up founded last year (2019) by Jonathan Krane, an American manager of asset management company KraneShares, which was later acquired and controlled by China International Capital Corporation, specializing in investing in China.
According to this, in addition to, Jonathan Krane, chairman of Silk EV, who is also the founder and CEO, of KraneShares, the latest move related to the Chinese market is the launch of Chinese Kechuang 50ETF in the United States on January 27th this year.
Also noteworthy is IDEX.US 's announcement on January 28th that it signed a securities purchase agreement with Silk EV, under which it invested $15 million in Silk EV. The interest rate on the convertible note is 6% and matures on January 28, 2022.
Protect Red Flag's target of one million vehicles in 2025
The contact between FAW and Silk EV can be traced back to 2018. In May and September of that year, FAW Group went to Italy twice to inspect Silk EV. Subsequently, on December 17 of that year, the main leaders of Jilin Province met in Changchun with Shen Shikang, former Mayor of Allahambra and Councillor for, Silk EV, and Jonathan Klein (Jonathan Krane), Chairman of Silk EV, and his entourage. Less than a year later, on November 25, 2019, the main leaders of Jilin Province met again with Shen Shikang and Jonathan Krane.
In March 2020, FAW Group and Silk FAW Group reached a cooperation intention and the two sides will set up a joint venture company. According to information released at that time, Silk will contribute 1 billion yuan, accounting for 85 per cent of the joint venture, while FAW will contribute 15 per cent of the shares with the 10-year right to use the Red Flag brand.
A month later, on April 23, the two sides formally signed the letter of intent for the Red Flag S series project. According to the letter of intent, the two sides will invest 10 billion yuan in the next few years to build a global technological innovation and automotive engineering ecosystem with Jilin Province and Modena (Automobile Valley) as the core, and create Red Flag S-series products. and mold it into a world-famous luxury sports car brand.
"Red Flag is the key project of FAW Power Insurance, and we must make every effort to ensure its production and sales." Zhong Shi, an analyst in the automobile industry, told reporters.
According to Red Flag's plan, 20 new products will be launched on the basis of its existing products by 2025, covering a full range of models such as L-Series (New Red Flag Supremacy cars), H-Series (New Red Flag mainstream cars), S-Series (New Red Flag Coupe) and Q-Series (New Red Flag Commercial cars). Among them, the S-series includes many models, such as S9, S7, S5 and S3. At the same time, FAW plans to account for more than 25% of red flag pure electric models by 2025.
The latest figures show that Red Flag completed sales of 32500 vehicles in January, up 158 per cent from a year earlier. In 2020, Red Flag sold more than 200000 vehicles, reaching its annual sales target of 200000 a year ahead of schedule. Based on last year's market performance, FAW has advanced Red Flag's sales target as a whole, with Red Flag's sales target of 400000 vehicles this year and 1 million in 2025.
