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According to Auto Commune, HiPhi Auto's parent company Human Horizons (Jiangsu) Technology Co., Ltd. (hereinafter referred to as "Human Horizons") had its pre-reorganization application accepted by the People's Court of Yancheng Economic and Technological Development Zone on August 8, 2024. This means that HiPhi Auto has temporarily avoided bankruptcy liquidation and may still have a chance to be reborn through reorganization.

At the beginning of the year, HiPhi Auto frequently made headlines due to financial crisis and internal management problems. Although in May this year, it was reported that HiPhi received $1 billion in financing from iAuto Group Inc. and signed a "Comprehensive Strategic Cooperation Agreement", according to people familiar with the matter, iAuto's support for HiPhi was limited to employee wages, and other debt issues were not resolved, resulting in slow resumption of work and production.

Human Horizons' application for bankruptcy reorganization does not mean that the company will die immediately. The purpose of bankruptcy reorganization is to save the company through asset integration and additional investment, while bankruptcy liquidation is to completely liquidate the company's assets.

According to the "Decision of the People's Court of Yancheng Economic and Technological Development Zone", Human Horizons filed a reorganization application on July 1 this year on the grounds that "its assets cannot repay all due debts, but it has reorganization value". This move shows that despite the company's deteriorating financial situation, there is still potential for reorganization.

According to Auto Commune, HiPhi's predicament is not only due to its over-high product positioning and insufficient intelligence, but also closely related to its chaotic internal management. In particular, the management problems of Yu Hai, head of its Internet of Vehicles (IOV) business, have aroused widespread doubts.

After Yu Hai joined the company in early 2022, his lack of proficiency in intelligent technology and his tough management style seriously affected the company's R&D progress.According to the whistleblower, Yu Hai "appointed people based on personal connections and excluded those who were different from him" during his tenure, which led to intensified conflicts within the company and low morale among the R&D team.

Ding Lei, the founder of Human Horizons, was once seen as the hope for the revival of the local manufacturing industry in Yancheng, but now that the company is in restructuring, his image as an entrepreneur has been questioned. Although the company has not yet completely died, the pre-restructuring process may cause employees and businesses to face longer suffering.

Pre-reorganization is usually a pre-step for bankruptcy reorganization, and is mainly negotiated between creditors, debtors and investors to reach key restructuring terms. During the pre-reorganization period, the company will continue to operate, but the arrears of employee wages and business uncertainty may be further exacerbated.

It is reported that as of April 30, 2024, the known overdue and unpaid debts of Human Horizons exceeded the company's total assets, indicating that the company is in deep insolvency.

Against the backdrop of rising penetration of China's new energy market, HiPhi's market position has become increasingly embarrassing.BYD、NIOWhile leading companies such as Nvidia and Qualcomm continue to achieve brilliant results, HiPhi is gradually sliding into the abyss amid internal and external troubles.

So in August 2022, some oppressed R&D employees wrote an anonymous letter accusing Yu Hai.

Whether HiPhi can regain its vitality through restructuring remains to be seen. But what is certain is that the success or failure of a company ultimately depends on the stability of its personnel and management, as well as its accurate grasp of market demand.