What is Xu Jiayin’s real intention when he emphasized that “seeing is believing” after inspecting Jia Yueting’s FF?

Evergrande Chairman Xu Jiayin spent nearly HK$7 billion to buy something, and he finally saw its true appearance these two days. Recently, Xu Jiayin traveled across the ocean to inspect Faraday Future's Los Angeles headquarters, accompanied by FF founder and CEO Jia Yueting throughout the trip.

Rather than an inspection, it was an inventory check after Xu Jiayin received the goods. After the inspection, Xu Jiayin repeatedly emphasized that "seeing is believing" and said that "FF will be given full support in terms of funding, production base construction and product sales."

On June 25, Evergrande announced that it had acquired 100% of the shares of Hong Kong Shiying Company for HK$6.746 billion, thereby indirectly acquiring 45% of the shares of Smart King and becoming the largest shareholder. This shows that Evergrande has officially taken control of FF under Smart King.

At the same time, Evergrande nominated Xia Haijun, vice chairman, president and executive director of Evergrande, as chairman of Smart King, and Shi Shouming, chairman of Evergrande Health, as a director of the joint venture.

Although Jia Yueting gave up his position as the major shareholder, he still enjoys the power of "1 share, 10 votes" and continues to helm FF as CEO.

Repeating Sun Hongbin's mistakes? Impossible

Xu Jiayin's public appearance this time was not only for inspection, but also for endorsement of FF. After all, Jia Yueting, who is known as a deadbeat, is no longer convenient to endorse FF. Xu Jiayin is trying to send a signal to the outside world - "FF cars are reliable", so as to reassure the market and investors.

Ever since Evergrande took over FF, the outside world has been discussing whether Xu Jiayin will become the second Sun Hongbin.

Although FF once made people very worried about its future, Xu Jiayin will never follow in Sun Hongbin's footsteps.

There is still controversy over whether Sun Hongbin suffered a huge loss on LeTV, but Xu Jiayin's acquisition of FF is a sure win.

Faraday Future is Jia Yueting's electric car startup and has nothing to do with the mess of LeEco's ecosystem. Evergrande naturally does not need to be responsible for Jia Yueting's previous mess.

Before being acquired by Evergrande, FF was already on the verge of bankruptcy. Just imagine what bargaining power Jia Yueting had at that time. Even if Evergrande bought at a low price, Jia Yueting still wanted to get this life-saving money.

Jia Yueting's FF company was founded in 2014. After leaving the United States, Jia Yueting devoted his main energy to FF's car manufacturing business. FF now has its own R&D team in the United States. Currently, FF has more than 1,400 employees, including more than 1,000 professional technicians. In addition, FF has obtained more than 380 patents.

The FF91, which took four years to develop, has excellent performance, and many technical indicators have reached the world's top level: the acceleration time from 0 to 100 km/h is 2.39 seconds, and the maximum range is 700 kilometers. In last year's Pikes Peak race, FF91 broke the race record by beating the Tesla Model S by 20 seconds.

It has to be admitted that although Jia Yueting is a deadbeat, FF still has something to offer. Xu Jiayin bought Jia Yueting's "dream" at a bargain price when FF was in its most difficult period.

However, after relying on Evergrande, Jia Yueting at least does not have to worry too much about funding issues. The joining of Evergrande is undoubtedly a major benefit for FF.

For Xu Jiayin, acquiring FF is more than just a bargain hunting.

The real estate industry has been developing rapidly for 20 years. Xu Jiayin, a real estate tycoon, often says that "real estate is a sunset industry" and proposed Evergrande's diversified development strategy as early as 2014.

Entering the high-tech industry is the current way for Evergrande to transform. The development trend of intelligence, networking and electrification provides broad development prospects for the automotive industry. At the same time, the Chinese government has also introduced a series of policies to support the transformation of the automotive industry.

Evergrande naturally did not want to miss this investment opportunity. Its acquisition of FF marks Evergrande's entry into the competition of new energy vehicle industry.

Whether mass production is successful or not, Evergrande will make a profit

According to FF's latest announcement, mass production will start at the end of 2018. However, there is no quantified number for FF's mass production.

This mass production target itself lacks sincerity and also reflects FF's lack of confidence in its own mass production capabilities. However, this is beneficial to Jia Yueting. After the expiration, even if the mass production quantity is insufficient, there is still room for maneuver.

Evergrande has signed a bet agreement with FF. If mass production cannot be achieved in 2019, Jia Yueting will lose his power of 10 votes per share, and Evergrande will dominate the operation of FF.

FF91 began accepting pre-orders in early 2017. FF said it has received more than 60,000 orders so far. However, it is easy to make an order but difficult to deliver. Tesla, the competitor of FF91, has received a steady stream of orders, but its production capacity has always been unable to keep up. The large number of orders has brought trouble to Tesla's operations.

For new car manufacturers like FF, mass production has always been a problem due to the lack of experience in car manufacturing. Even if Evergrande guarantees funding, it will not be easy to achieve mass production considering the ultra-high configuration and technical difficulty of FF91.

However, FF also has its own advantages. FF is now operating in both China and the United States, which is conducive to integrating the advantageous resources of both places.

Xu Jiayin also said that Evergrande will provide FF with all-round support in terms of funding, production base construction, product sales, etc. Now with Evergrande's assistance, it is not completely impossible for FF to achieve mass production.

FF is Jia Yueting's last hope for a comeback. Whether the mass production is successful or not is related to whether Jia Yueting can continue to lead FF. For Jia Yueting, this time he can only succeed, not fail.

Moreover, there is not much time left for FF.

On the one hand, as new energy vehicles become more mature, the subsidy policies of China and the United States for new energy vehicles will gradually decline. Evergrande certainly hopes that FF will be mass-produced as soon as possible to catch up with the last policy dividend.

On the other hand, Tesla has confirmed that it will build a factory in Shanghai, and traditional giants such as BBA have gradually launched new energy vehicles and gradually completed their layout in the Chinese market. FF is targeting Tesla and is positioned as a high-end electric vehicle. It is in the same market segment as Tesla and BBA, so competition is inevitable. Compared with Tesla and BBA, FF is much more vulnerable.

If FF can achieve its mass production goal, everyone will be happy.

If not, Evergrande will not lose out. LeEco's greed for perfection and FF's previous half-dead state have made people doubt Jia Yueting's ability. The title of deadbeat is always a stain that Jia Yueting cannot wash away, and it is bound to affect FF's operations.

Considering Jia Yueting's management ability and historical problems, Evergrande's shareholders may want to change the helmsman, and the market will also be more welcoming to an FF without Jia Yueting.

To take a step back, even if FF completed mass production as scheduled, FF's situation would not be too optimistic.

In the last week of the second quarter of this year, Tesla completed its target of producing 5,000 Model 3 vehicles per week, which was originally scheduled for December 2017, six months late. After the news came out, Tesla's stock price rose by nearly 5% in one day.

On July 3, the industry reported that Tesla rushed to bypass some testing procedures in order to achieve its mass production target. As a result, Tesla's stock price fell by more than 7% that day.

Similar to Tesla, FF91's accelerated pursuit of mass production targets may bring about safety concerns, and it is difficult to predict how the market will ultimately react.

However, regardless of whether FF under Jia Yueting's leadership can successfully achieve mass production, Xu Jiayin will have the last laugh.

As a winner of Toutiao's Qingyun Plan and Baijiahao's Bai+ Plan, the 2019 Baidu Digital Author of the Year, the Baijiahao's Most Popular Author in the Technology Field, the 2019 Sogou Technology and Culture Author, and the 2021 Baijiahao Quarterly Influential Creator, he has won many awards, including the 2013 Sohu Best Industry Media Person, the 2015 China New Media Entrepreneurship Competition Beijing Third Place, the 2015 Guangmang Experience Award, the 2015 China New Media Entrepreneurship Competition Finals Third Place, and the 2018 Baidu Dynamic Annual Powerful Celebrity.