(Yicai Global) July 10 -- Although Leshi Holding (Beijing) Co. (LeEco) remains cash strapped, construction is underway at LeCar's only domestic base -- the Le Supercar plant in Deqing, Zhejiang.

For now, the government is optimistic about the LeCar program and construction is still going on, the National Business Daily quoted officials as saying today. The build out of LeEco's automobile industrial park in Deqing has been carrying on as planned since it began last December, Deqing county officials said.

LeEco Ecological Car (Zhejiang) Co.'s project, with an annual production capacity of 150,000 sets of electric vehicle parts, was included in the province's 2017 list of key construction projects, per documents issued by the Zhejiang Provincial Development and Reform Commission this year. The LeCar program, the Zhejiang University of Technology's Deqing campus and two other projects are major ones for the province and city, the Deqing County Development and Reform Commission said.

Given LeEco's capital shortage, LeCar has brought on a local state-owned construction company in Deqing as an investor, reports said. The head of the economic development bureau is responsible for monitoring the LeCar program, and construction on the LeEco phase one press workshop went smoothly in the first quarter, the Deqing Economic Development Zone's management committee said.

Construction on LeCar's Deqing project began on December 28 last year, and phase one is expected to be completed in the second half of next year, reports said. While seven months have passed, the project is still in the piling stage and no buildings have been erected. LeCar bought land plots for industrial purposes in two purchases, locals said. The lots were stone mines before being closed by the local government. Since the earth is rocky, construction is difficult and the ground blasting and cleanup required before construction can start has progressed slowly.

The government has been involved in LeEco's car project in Deqing, said Song Qinghui, an economist.

"LeCar could be the last lifeline for LeEco," said Song. "LeEco will win if its car program succeeds and lose if it fails. LeEco's problem is not complex at all. It is facing pressure on several fronts because of its excessively high debt to asset ratio and cash shortages. LeEco is engaged in too many fields. It could still turn things around if it pulls back a little."