Chinese electric vehicle maker WM Motor has suspended its application for an initial public offering on Shanghai’s tech-focused Star Market, Sina.com reported on Thursday.
Securities regulators identified shortcomings in the EV firm’s IPO application, Sina wrote, citing an unnamed source who is part of SDIC Chuangyi, a wholly owned subsidiary of State Development & Investment Corp. Ltd and an investor of WM Motor.
WM Motor denied that it has shelved its IPO application and said to Sina that the company is awaiting processing while regulators tighten scrutiny over companies that have applied to go public. WM Motor has not responded to KrASIA’s inquires into the matter.
“While it is not certain how WM Motor’s IPO application progresses, the circumstances have changed unfavorably for WM Motor,” Zhang Xiang, an auto analyst with a government-affiliated think tank, told KrASIA on Thursday.
When WM Motor kicked off its IPO process last year, the company was one of the top EV players in China. But the scene is becoming much more crowded, with the likes of Baidu, Xiaomi, and Didi tossing their hats into the ring, each offering a road map to their own EV production venture.
More than that, WM Motor’s sales are not growing in step with other brands. The automaker delivered 16,876 vehicles in 2019, barely surpassing Xpeng’s 16,608 units and lagging behind Nio’s 20,565 cars, according to Sina. In 2020, WM delivered 22,495 vehicles, while Xpeng bumped its output up to 27,041 units and Nio shipped 43,728 cars.
The sales gap between WM and the other EV makers widened much further in the first quarter of 2021 as WM only handed over 3,020 cars to buyers. Xpeng managed to ship 13,340 cars, and Nio fulfilled 20,060 orders.
WM Motor is set to unveil its new car in Shanghai on Friday. Industry and consumer reactions may impact the company’s IPO application process, Zhang said.