The Hengchi 5 is complete with basic features and is just short of a road-access permit for mass production.

(Image credit: CnEVPost)

Evergrande Auto, the car-making arm of Chinese real estate developer Evergrande Group, has entered the trial production phase of its Hengchi 5, the closest model to mass production, Sina Tech said in a report Monday.

The report cited production line staff at Evergrande Auto's facility in Tianjin as saying that the vehicle is fully functional with basic features and a complete interior, and is just short of a road-access permit for mass production.

Hengchi 5 prototypes are often seen on the plant's internal track, and while not fast, are not the model cars commonly used for show in the past, the report said.

In response to the report, Evergrande Auto's sources affirmed when contacted by caijing.com.cn.

Evergrande Auto, which launched its new brand Hengchi in August 2019, has announced nine of the 14 vehicles it has designed, but none have yet begun mass production.

The company has car production plants in Guangzhou, Shanghai and Tianjin. But with funding chain problems erupting, only the Hengchi 5 and Hengchi 6 projects remain, as LatePost reported last month.

The faster-moving Hengchi 5, which is set to launch first, was originally planned to start production at the Nansha plant in Guangzhou, but the plant never received production status from regulators. Earlier this year, Evergrande Auto shifted its strategic focus to the Tianjin plant, which has the qualifications to build the car, according to LatePost.

However, the report said that Evergrande Auto's production line renovation work at the Tianjin plant has been largely stalled, and the Hengchi 5, which was scheduled to launch early next year, has not been ready to start production as scheduled. The latest report seems to have refuted that report.

With Evergrande's debt crisis erupting, the fate of its car-making business has raised high concerns. But a series of recent developments suggest that things seem to have been getting better for Evergrande Auto.

According to an article published on Evergrande Group's official website on October 11, Evergrande Auto held a partner meeting at its Tianjin production base with Tianjin government officials and executives from 200 strategic partners, including Bosch and Hitachi, in attendance.

Evergrande Auto President Liu Yongzhuo said the company has launched a three-month campaign to ensure that the first Hengchi model will roll off the line at the Tianjin plant early next year.

On October 22, Evergrande held a meeting focused on the resumption of the project, and its chairman Hui Ka Yan said the company would in principle not buy any new land within 10 years and would complete its transformation from a real estate developer to a new energy vehicle maker.

Evergrande Auto reportedly faces setbacks at its main facility in Tianjin, first model could be further delayed