Automobile Owned by Edison Will See its Resurrection in China

    Yixing, located in the west bank of Taihu Lake, is well-known as the original place of purple clay teapot and the pottery city of China. However, most people have no idea that Yixing is also one of the county-level cities with strongest comprehensive strength of China, ranking 10 on the list of 2016 China Top 100 Counties and featuring wire and cable industry as the largest pillar industry.

　　On the afternoon of February 18, 2017, Detroit Electric Vehicles Project Signing Ceremony was held in the conference hall on the third floor of Howard Johnson Garden Plaza Yixing. The ceremony, directly hosted by Zhang Lijun, Mayor of Yixing Municipal People’s Government, is of great significance to Yixing City.

     A Scene of the Signing Ceremony, Guests from Left to Right are Albert Lam, Chairman of Detroit Electric Holdings Limited,

    Zhu Xufeng, Permanent Member of the CPC Yixing Municipal Committee and Director of Yixing Environmental Protection and Sci-tech Industrial Park Management Committee, and Jiang Chengzhi, President of Far East Smarter Energy Co., Ltd.

　　The project is planned to establish Detroit Electric Co., Ltd., a joint venture of Far East Smarter Energy Co., Ltd. (hereinafter referred to as Smarter Energy), Detroit Electric Holdings Limited and China Yixing Environmental Protection and Sci-tech Industrial Park Development Corporation that is specialized in R&D, manufacturing and sales of vehicle, accessories and relevant technologies of electric automobiles.

    According to the agreement, Detroit Electric Automobile and Accessories Manufacturing Project will be developed in Yixing Environmental Protection and Sci-tech Industrial Park with the first phase of investment of USD 1.8 billion, including USD 600 million invested by stockholders through registered capital and USD 1.2 billion raised by Detroit Electric Co., Ltd. through ways such as debt financing and bank loan.

    Announcement released by Smarter Energy on that day has revealed the investment proportion of each joint venturer, including USD 60 million invested by Yixing Environmental Protection and Sci-tech Industrial Park in the form of equal RMB cash, accounting for 10% of total shares, USD 240 million contributed by Smarter Energy in the form of equal RMB cash, accounting for 40% of total shares, and USD 300 million containing USD 50 million of USD cash and USD 250 million of conversion of assets of SP:01 Project invested by Detroit Electric Holdings Limited, accounting for 50% of total shares.

    Smarter Energy is a listed subsidiary of Far East Holding Group Co., Ltd. Far East Holding Group Co., Ltd. (hereinafter referred to as Far East), founded in 1990, is a leading enterprise in the cable industry of Yixing, and began to adjust its strategy in 2013 by transforming from a traditional cable manufacturer into a smart energy service provider and focusing on the field of new energy automobile.

    In July 2015, Smarter Energy wholly acquired Jiangxi First, an enterprise specialized in battery manufacturing, and renamed it Far East First New Energy Co., Ltd. (hereinafter referred to as Far East First). Now Far East First has become a leading production enterprise of 18650 ternary lithium battery, and ranks No. 1 in China and No. 3 in the world in terms of annual production and sales volume. In the first three quarters of 2016, Far East First achieved an income of RMB 674 million in energy storage equipment business like power battery.

    According to the plan, Smarter Energy will invest on the construction of factories producing lithium battery with capacity of 3 GWh and 6 GWh in Yichun, Jiangxi and Yixing, Jiangsu respectively. Along with the previous project of “With the Quantity of Energy-storage Power Battery Increase to 65,000”, it is expected to complete the construction of factories producing lithium battery with capacity of 10 GWh by the end of 2018, among which the capacity of power lithium battery will be not less than 9 GWh.

    By participating in Detroit Electric Vehicles Project, Far East is able to extend the industry from automobile battery production to automobile production and further perfect the industrial chain of new energy automobile based on the original layout of power battery industry of Far East First.

    Jiang Xipei, founder of Far East, said at the signing ceremony that “I believe that new energy automobile industry will become one of a few industries with the scale of a hundred-billion or a trillion.”

    Resurrection of the Century-old Electric Automobile Brand

    Detroit Electric Holdings Limited, majority stockholder of the joint venture company, also has a powerful background. As a one-hundred-year brand created by Anderson Electric Co., Ltd. in 1907, it became the enterprise with largest sales volume at that time and even inventor Edison owned an electric car of Detroit.

However, Detroit Electric faded away from the historic stage in 1939 as electric cars replaced by internal combustion engine cars. Many years later, a Hong Kong businessman revived Detroit Electric when electric car became a new trend for global automobile industry again.

    His name is Albert Lam. In 2008, after working as CEO in Lotus Engineering Group for five years, Albert Lam decided to bring Detroit Electric back to life. Now he is the president of Detroit Electric Holdings Limited, accounting for about 40% shares of Detroit Electric Co., Ltd.

    In 2013, Detroit Electric Holdings Limited launched the SP:01, the first pure electric supercar delivered after its resurrection based on the same chassis as Lotus Elise. It was Albert Lam, CEO of Lotus Engineering Group, that led the cooperative project with Tesla Roadster.

    Therefore, Albert Lam pointed out at the media meeting held on the evening of February 18 that products of Detroit Electric Holdings Limited would be well-matched in quality with that of Tesla Roadster.

    With remarkable advantages of performance and motoring, the Detroit Electric SP:01 boasts an impressive 155 mph (249 km/h) top speed and covers the 0-60 mph sprint in a blistering 3.7 seconds through high power motor. Now the SP:01 is produced in the United Kingdom with sales channels jointly established by Detroit Electric and international agencies in countries and regions such as Europe, the United States and Asia-Pacific region.

    By the end of 2016, Detroit Electric Holdings Limited had total assets of USD 45.7374 million as well as annual operation revenue of USD 75,500 in 2016.

    Detroit Electric Holdings Limited has its own manufacturing base in Yixing through this project, and plans to invest “Far East First”, the battery production enterprise in Jiangsu, to establish an in-depth and long-term strategic cooperative relationship with Smarter Energy.

    After the settlement in Yixing, Detroit Electric Co., Ltd. will first offer a pure electric SUV as the China-built model, and will plan for more products in the future.

    Albert Lam indicated that “as a man of Chinese descent, I always want to make great contribution to China.” His vision is to settle the time-honored electric automobile brand in Yixing, and build it into the first original equipment manufacturer with high-end brand in China and a global company in the world.

    In accordance with the plan, market share of products of Detroit Electric Co., Ltd. will account for 30% in China and 70% in Europe and North America. As Albert Lam said, “We can research and develop the best automobile by introducing the best technology of Europe and North America into China, and sell our products to foreign markets again. In the future, we produce automobiles sold to markets around the world instead of only being sold to China’s market.”

    The joint venture company is expected to be constructed in 2017, obtain the electric automobile production qualification and sell products produced by original equipment manufacturer in 2018, launch the first electric automobile independently produced by Detroit Electric Co., Ltd. in 2019, and achieve the annual production and sales volume of 100,000 in 2020.

    Albert Lam becomes President and CEO of Detroit Electric Co., Ltd., while the Vice President will be appointed by Far East. As for using new name instead of “Detroit”, Jiang Chengzhi, President of Smarter Energy, explained that since the name of a foreign place is not allowed by State Administration for Industry & Commerce of PRC to be used as company name, Smarter Energy had to change its translation by a homophonous word.

    It is learned by the journalist that it did not take much time to complete the new energy automobile project from its original idea to its official launch. Since November 2016, Yixing government started to pay attention to the project, and Far East participated in the investment decisively. After three-month intensive, effective and responsible consultation and negotiation, the project was signed successfully.

    Albert Lam described the cooperation of three parties at the signing ceremony in one sentence: “Yixing government is like the fertile soil, Detroit Electric Co, Ltd. is like a farmer with the seed, and Smarter Energy is like sunshine and rain. The three parties will make joint efforts to let the seed root and sprout.”

    New energy automobile industry has good development prospect with strong support of central government and special attention paid by local governments in the course of investment promotion. For example, another local government hoped to win the Detroit Electric Vehicles Project before it settled in Yixing.

    The example indicates that since the development of new energy automobile industry is valued by more and more cities, more and more automobile brands will involve in the industrial competition in the near future. We expect to see that whether the survived emerging automobile enterprises will be not more than five as it was analyzed by business insiders, or will flourish in different styles.