(JW Insights) May 30 -- Aiways (爱驰汽车), a Chinese new energy vehicle startup backed by Chinese tech giant Tencent, has terminated the lease on its headquarters building in Shanghai, reported Yicai Global on May 24. This is the latest sign of the poor performance of the company.

“The HQ has been empty for over a week, as the lease has been canceled,” a staff at the property manager of the industrial park where Aiways’ Shanghai office was located told Yicai Global during an on-site visit.

An Aiways insider said the carmaker’s staff in the city are working from home, and the Shanghai-based company has not yet paid salaries for March and April, with those for this month will likely to be delayed as well.

Founded in 2017 by Fu Qiang, who previously held senior positions at Mercedes-Benz, Audi, and Volvo, Aiways has raised nearly RMB10 billion ($1.4 billion) from well-known Chinese companies such as Tencent, CATL, and Didi Global.

Many Chinese NEV startups, including WM Motor, Enovate Motors, and Hengchi Automobile Trading, have hit operational difficulties since the start of this year due to increasingly fierce competition and frequent capital chain problems caused by poor financing.

Zhu Huarong, chairman of Changan Automobile, said earlier this month that in the past three years, about 75 car brands in China closed, suspended operations, merged with peers, or switched business focus. In the next two to three years, even by a conservative estimate, 60 to 70 percent will be eliminated, Zhu added.

Since its establishment, Aiways has only released two car models. As it has been mainly focused on the European market, it missed out on the growth opportunities brought by the fast development of the Chinese market.

In March 2021, Aiways cut salaries, canceled year-end bonuses, and failed to pay suppliers. Moreover, the company was said to have salary arrears in November of that year, said the Yicai Global report.

(Li PP/Chen HX)