(Yicai Global) Sept. 15 -- Hanteng Automobile, a Chinese carmaker in financial trouble, promised to pay overdue salaries by the end of this week. The pledge comes after workers exposed its failure to pay up, sparking widespread concern.

Hanteng will transfer June and July's salary payments to staffers' personal bank accounts by Sept. 12, Sina Auto reported today, citing an employee at the Shangrao, Jiangxi province-based startup.

The employee also revealed that Hanteng had been in financial trouble earlier. It could only pay April and May's wages after mortgaging workshop equipment. There were 10 records of movable property mortgage between Jan. 13 to July 29, involving debts of CNY1.5 billion (USD221 million), according to records on business information platform Qixin.

Hanteng has fallen foul this year of the Covid-19 outbreak. It sold just 7,683 vehicles in the first seven months, down nearly 70 percent from the same period last year.

The firm's difficulties have come to the attention of the Shangrao Economic and Technical Development Zone, where it is located, National Business Daily reported yesterday. Officials have been stationed at Hanteng, urging the company to resolve the wage arrears issue, the report said.

Besides the arrears, Hanteng has extended its 'heat vacation.' Carmakers routinely arrange equipment overhaul periods each summer during which workers enjoy paid leave. This year, Hanteng's had been scheduled from Aug. 10 to Sept. 6, but it was extended to Oct. 8, with staff paid the local minimum wage of CNY1,430 (USD211) each.

Founded in 2013, Hanteng was the first finished vehicle production project introduced to Shangrao Economic and Technical Development Zone. Its main investor is Zhejiang province's Tech New Group, the parent company of Zotye Automobile.

Zotye Automobile is also mired in an operating crisis. Last month, it reported a first-half net loss of CNY1 billion, a three-fold increase from a year earlier, with its factories largely shut down. Meanwhile, Tech New filed for bankruptcy restructuring with a local court earlier this month.

Editor: Peter Thomas