The founder of Reading Motors reported to local officials with his real name: he was forced to falsely report the output value of nearly 5 billion

On January 14, Reading Motor Group’s WeChat public account issued a real-name report letter. Li Guoxin, the founder of Reading Motor, reported Wang Xiao, the current secretary of the county party committee of Changle County, Weifang City, in his real name. In the 10 months of the year, the industrial output value and sales output value of the enterprise were falsely reported by 4.683 billion yuan. Since March 2022, large local companies such as Reading Automobile have been forced to falsely report their industrial output value and sales output value by tens of billions.

At the same time, Li Guoxin also released a video through the network platform to report. Once the above-mentioned video was disseminated, it immediately aroused heated discussions on the Internet and became a trending topic on Weibo.

In the evening of the same day, the WeChat public account “Weifang Release” of the Information Office of the People’s Government of Weifang City announced that in response to the real-name report of the founder of Reading Automobile Group on the main person in charge of the Weifang Changle County Party Committee, Shandong Province has established a joint provincial and municipal department. The investigation team was stationed in Changle County to investigate and verify the relevant situation, and dealt with it according to laws and regulations.

The whistleblower claimed that he was forced to falsely report the output value of 4.683 billion yuan

According to public information, Reading Motors was established in 2008, and initially its main business project was low-speed electric vehicles. At that time, there were not many competitors in the market, and Reading Motors quickly occupied the market, opening up its popularity and influence in the field of low-speed electric vehicles.

However, due to the wide variety of low-speed electric vehicle products and the uneven quality, most enterprises grow wildly and lack unified supervision and guidance. In 2018, the Ministry of Industry and Information Technology and other six ministries and commissions jointly issued the “Notice on Strengthening the Management of Low-speed Electric Vehicles”, which clearly requires that the elimination of illegal electric vehicle products in use should be accelerated through replacement, repurchase, and encouragement of scrapping.

Since then, low-speed electric vehicles, which have been in the gray area for a long time, have gradually withdrawn from the market stage. But at the same time, the new energy vehicle market continues to heat up, which also allows Reading Motors to see greater market opportunities. In April 2018, Reading Automobile acquired Shaanxi Qinxing Automobile, obtained the production qualification of new energy commercial vehicles and special vehicles, and established the Reading Qinxing New Energy Vehicle Production Base in Xianyang.

On the basis of obtaining the production qualification, Reading Automobile spent 1.45 billion yuan to acquire Sichuan Automobile Yema Automobile in January 2019, and obtained the production qualification of new energy vehicles, fuel passenger vehicles and buses.

In 2021, Reading Motors will launch its main model – Reading Mango, focusing on the A00 pure electric mini-car market. Public data shows that in 2021, the cumulative sales of Reading Mango will be more than 30,000 vehicles.

However, the good times don’t last long. In 2022, the development of Reading is in trouble, and the capital chain is in crisis. On November 21 of that year, the company announced the completion of the A round of financing, with an overall financing scale of 3.2 billion yuan. It is reported that this round of financing was led by Weifang Weicheng West Investment and Development Group, followed by state-owned capital, industrial and private capital from Shandong province.

In the report letter, Li Guoxin also mentioned this financing, saying that in July 2022, after the loans guaranteed by the Changle County government for the acquisition of Yema Automobile expired one after another, the current county party secretary Wang Xiao would no longer renew the loan for Reading Automobile. After several communications, there was still no result. Even Weifang City sent a working group to Changle to coordinate and solve the problem, but there was still no solution. Subsequently, the company achieved 3.2 billion yuan in financing through external capital investment, but as of today, the financing funds have not been in place as agreed.

In addition, the report letter directly pointed out that Wang Xiao, the current secretary of the county party committee of Changle County, in order to highlight his personal political achievements, since March 2022, has forced Reading and other large local enterprises to falsely report their industrial output value and sales output value by tens of billions. Among them, Reading Motors falsely reported a total of 4.683 billion yuan in 2022.

Li Guoxin said that as the founder of the company, he was worried about offending Secretary Wang Xiao, and also worried about being listed as a “statistical dishonesty enterprise” that would affect the company’s credit investigation. After weighing the pros and cons, he had no choice but to report the data as required.

In response to the situation reported by the founder of Reading Motors, Shandong Province has established a joint investigation team composed of relevant provincial and municipal departments, and stationed in Changle County to investigate and verify the relevant situation.

Arrears of car payments to dealers are complained

Reading Mango, an A00-class electric vehicle launched by Reading Motors, belongs to the same market segment as Wuling Hongguang MINI EV. According to public data, the data shows that in the first half of 2021, the sales of A00-class new energy vehicles accounted for 36%, which is the largest market segment, and the year-on-year growth rate is much higher than that of other segments.

Facing the blowout of the market, Reading Motors has set an ambitious sales target, which is to achieve sales of 2 million vehicles by 2025. In terms of sales channels, Reading plans to cover 2,845 districts and counties across the country by 2025, realizing a comprehensive sinking of channel services.

However, affected by factors such as the epidemic and soaring raw materials, the sales of Reading Motors fell off a cliff in 2022, and the company’s operations were once in crisis.

According to the information released by China Judgment Documents Network, Reading Automobile Group has been ruled to freeze funds many times so far due to the loss of the sales contract dispute. It is reported that in November 2022 alone, Reading Motors has been listed as the person subject to execution by multiple courts a total of 8 times.

In addition, Reading Motors was also sued by the supplier for arrears of payment. According to the public information of China Judgment Documents Network, on December 9, the People’s Court of Changle County, Shandong Province ruled that Reading Automobile should pay Taizhou Jinna Axle Co., Ltd. 845,224.6 yuan of goods and interest.

The civil judgment of the People’s Court of Changle County, Shandong Province shows that Taizhou Jinna Axle Co., Ltd., as the designated supplier of Reading Automobile, provided spare parts to Reading Automobile in accordance with product quality requirements during the cooperation period, but after the agreed payment node expired, the defendant No payment has been made. It was mentioned in the judgment that Reading Motor argued that the plaintiff’s payment was not unreasonably delayed due to the company’s operating difficulties.

On the black cat complaint platform, there are also multiple complaint information showing that Reading Auto owes the dealer car payment. An anonymous person said, “The manufacturer in Reading owes the dealer the car payment, and has not released the car for a year. There is not a single show car in the store. Ask the business manager when the car will be released, and push it again and again.”

Li Guoxin mentioned in the report letter that the Reading company is currently in a state of suspending work and production.

Editor in charge: Peng Bo