IN FOCUS: KANDI TECHNOLOGIES, INC., GENERAL OVERVIEW, BUSINESS STRATEGY AND GROWTH PROSPECTSThe alphaDIRECT Insight
Kandi positions itself as one of the pioneers of the EV industry in China. Kandi introduced its first EV in 2007 and now produces EVs through a joint venture with Geely, China’s largest and fastest growing non-state-owned automaker. Kandi’s shares have been listed on the Nasdaq for twelve years. Kandi believes it is in a unique position to leverage the fast-growing lower price point segment of the EV market both in China and abroad. According to government forecasts, China is set to be the largest EV market in the world; its “new energy vehicles” sales are projected to grow to 2.1 million units annually in 2020, which reflects only 7% penetration. Kandi’s focus is to provide good quality at an accessible price point to reach a broad middle market for EVs, in contrast to competitors like Tesla or NIO that target the smaller premium segment. Kandi is also approved in the U.S. to ship its Model EX3 and Model K22 cars with distribution through its wholly-owned SC Autosports. In summary, Kandi has a differentiated position in the market relative to higher-end OEMs and is focused on a large market segment both in China and abroad. In this Management Series we focus on a general overview of the company and its strategy and growth prospects.
Shawn Severson: First of all, we would like to thank you, Mr. Hu, for taking the time to speak with us today. You are the founder and CEO of Kandi Technologies, the first China-based electric vehicle company listed on the Nasdaq stock exchange since 2008. Mr. Hu, before we get started can you please provide us with a brief introduction of yourself and what brought you to Kandi? Also, can you provide us with a short review of the company’s history and core business?
Hu Xiaoming: Absolutely, Shawn. I founded Kandi in 2002 and have been purely focused on EVs since 2006. During our first year as a public company, we introduced our first EV model, the “Kandi Coco”, and exported this model to the U.S. We ultimately sold 10,000 of them in total and Kandi was a global company from the start. We were not only listed in the U.S., but also in China where we sold our products as well.
One of our most important developments was in 2013, when we formed a partnership with Geely, which is one of the largest and fast-growing automakers in the world, based in China. Our partnership with Geely enabled us to accelerate the development and scale up the production of high quality EVs. In addition, it helped to grow our production capacity and improve brand recognition.
In 2019, an affiliated company Fengsheng (formerly known as Kandi Electric Vehicles Group) received an approval from NDRC and the MIIT, which officially made us dual-qualified as a pure electric passenger car manufacturer.
Today, we are broadly diversified across the electric vehicle value chain. Our core business is the development, manufacture and sale of electric vehicles, all-terrain vehicles, battery packs, electric vehicle drive motors, electric vehicles controller, and air-conditioning systems. Since 2013, the Company has increased its focus on the development of pure EVs with a particular emphasis on expanding its market share in China. Our business has more depth now than it did at the very start, but everything we do still relates to the EV market.