(Yicai Global) Dec. 19 -- Zotye Automobile’s share price jumped after the Chinese carmaker revealed a plan to sell 10,000 small sport utility vehicles in the Middle East by the end of next year.

Zotye [SHE: 000980] ended 5.6 percent higher at CNY5.81 (83 US cents) a share today, after earlier soaring by the 10 percent exchange-imposed daily trading limit.

The automaker plans to sell 10,000 of its gas-powered T300 sport utility vehicles, worth CNY692 million (USD99.2 million), in Middle Eastern markets by the end of 2023, it said late yesterday. Lvsai International Trade Yongkang will be the exclusive distributor and after-sales service provider.

This is the first tie-up between the two Yongkang-based firms, Zotye noted. Lvsai has a good reputation and the ability to fulfil the deal, despite being set up just three months ago with a registered capital of CNY3 million (USD430,097), it added.

Zotye warned that the partners may fail to carry out the plan or prematurely terminate it because of policies, the market environment, or other factors, adding that the cars procured by Lvsai also may not reach the target number.

Founded in 1998, Zotye sold 116,600 cars in 2019, down from more than 330,000 in 2016, as market competition intensified, according to data from the China Passenger Car Association. Launched in August 2017, the T300 SUV is priced at CNY59,800 (USD8,573) apiece in China.

Drowning in debt, Zotye stopped production in the second half of 2019 as funds dried up. Its parent firm Tech-New Group was declared bankrupt by a local court at the end of 2020, and Zotye announced a debt restructuring plan. The firm had racked up losses of CNY22.4 billion (USD3 billion) between 2019 and June 30 this year.

Zotye was bailed out by investment firm Jiangsu Shenshang Holding Group at the end of last year with a cash injection of CNY2 billion (USD286.6 million) in return for a 14.7 percent controlling stake.

Editor: Martin Kadiev