Plug Pulled: Byton Suspends Production, Plans Reorganization

Matt Posky
by Matt Posky
plug pulled byton suspends production plans reorganization

Chinese electric car startup Byton will reportedly idle production next month as it attempts to reorganize itself. While the coronavirus emerged as a villain in this play, the issues confronting Byton actually seem pretty dire. The company isn’t just idling factories to address a health crisis, it’s shutting things down for six months while it engages in more fundraising and tries to pay what’s owed to employees.

That’ll be tough with no normal income. Byton has already furloughed a large portion of its staff in California and plans to cease all production in Nanjing. While we knew the PRC’s approach to electrification would ultimately result in countless EV startups going under, we didn’t expect Byton to be among them. Slick products, good marketing, and interesting designs made it seem like it could go the distance — now it seems wholly preoccupied with survival.

Bloomberg, managed to intercept an internal letter to employees explaining the situation this week:

“The new coronavirus epidemic has brought great challenges to Byton’s financing and production operations,” the company said in a statement. “After careful consideration and joint consultations with our shareholders and management, we have decided to, from July 1, kickstart a plan to lower employee costs and promote the company’s strategic reorganization.”

Byton’s relationship with state-owned FAW Group presents another problem. Several years ago, a company with a close relationship with the Chinese government wasn’t deal breaker. That changed after numerous foreign governments decided popular communications entities — like Huawei and Zoom — posed serious national security risks. Having ties to the CCP isn’t doing Chinese businesses any favors these days, at least not in terms of their global marketing efforts.

The manufacturer said it received approval from the State of California late in 2019 to sell its products there and had a working plan to launch the M-Byte electric crossover in Central and Northern Europe for next year. While the EU may still welcome a firm like Byton, the United States seems less apt to cooperate as relations between the two countries continue to worsen. By the time Byton gets its ducks in row, its window into North America may have shut.

Nor have things gone particularly well in China. While we can only speculate on how badly COVID-19 impacted the nation’s industrial sector, we know it’s worse than the government let on. We also know that expectations that Chinese customers would adopt zero-emission vehicles in droves have gone unmet. Despite flooding its own market with EVs, demand for these vehicles started to recede last year. That’s partly the fault of aggressive governmental mandates that confused and spooked would-be customers, but the auto market was already cooling as China’s economy took a turn for the worseonly to be further harmed by the pandemic.

[Image: Byton]

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  • SCE to AUX SCE to AUX on Jun 30, 2020

    That is a bit of a surprise. Yet again, it proves how hard it is to attain stability as a car mfr.

    • SPPPP SPPPP on Jul 01, 2020

      Interesting because the two main difficulties for traditional ICE makers are emissions compliance and safety compliance. EV makers are basically free from emissions compliance. But the business is still very difficult.

  • Sgeffe Why on Earth can’t you just get the torque specs and do it yourself if you’re so-inclined?!
  • Sgeffe As was stated in another comment, the FAA nominee went down in flames. But the NTSB chairwoman certainly didn’t, and she’s certainly not qualified either!Lots of this kind of stuff going on both sides of the aisle—Ben Carson would have arguably made a better Surgeon General than HUD Secretary under Trump, for example.
  • Art Vandelay Interesting, the Polestar 2 I had as a rental utilized Android Automotive which is what GM said it is going to exclusively, yet it still offers Apple CarPlay according to this. Wonder if GM will do the same.
  • Stuart de Baker EVs just aren't ready for prime time for those with a single car and who take road trips. Being able to charge as soon as you arrive at a charging station, and even the chargers working on your car is a crapshoot. In the former case, you could have to wait for nearly an hour while someone else is charging.I also don't find EVs particularly fun to drive (I've driven a Tesla Model S and an Ionic 5.) I LOVE driving my '08 Civic (stick). I love the handling, the feel and responsiveness of the engine, the precise steering (the Michelin Pilot Ultra Sport tires help, but even with the snows on, the car is a joy). I have 152k on the clock, and hopefully another 25 years or so of driving (I was born early in the Eisenhower Administration and I have exceptionally healthy habits), and I'm going to try to keep the Civic for the duration.My Civic causes a less global warming emissions than some of these humongous battery operated trucks.
  • FreedMike They should throw in a Lordstown pickup with every purchase. Make it the “vapor twofer.”