(Yicai) Jan. 3 -- WM Motor, a struggling Chinese electric vehicle startup, has made progress in getting its restructuring started to bring in investors to continue operations.

The pre-restructuring application, filed in October, was approved by a court in Shanghai, the Shanghai-based firm announced on Weibo today. WM has completed audit evaluation, debt declaration, and asset verification. It has approached several potential investors while achieving preliminary results, it noted.

After multiple evaluations, prospective investors generally believe that even though WM Motor is currently facing a liquidity crisis, it has value and potential in terms of product technology, industrial chain, market operation, and manufacturing so reorganization is feasible, the firm said.

Founded in 2015, WM was one of the first new energy vehicle startups in China to achieve mass production. However, since the second half of 2022, it has had trouble with liquidity due to sluggish sales so production stopped.

A potential acquisition seems to have fallen through as no further news came out after Kaixin Auto Holdings, a used car dealer, announced in September that it had signed a non-binding acquisition agreement with WM to acquire all of its shares by issuing new equity.

WM tried several times to ease its financial pressures by going public. According to a prospectus, WM's cumulative losses from 2019 to 2021 were as high as CNY17.4 billion (USD2.4 billion).

Editor: Emmi Laine