(Yicai Global) April 28 -- The owner of Chinese airline Juneyao Air is taking control of Fujian province-based Yudo Auto, which once was China's second-largest new energy vehicle startup, according to an insider.

Juneyao Group will recruit a technical team from a leading car company for Yudo after acquiring more than half of the latter's shares, a person close to Yudo said to Yicai Global yesterday.

However, the Shanghai-based conglomerate has not commented on the matter. 

Founded in 2015, Yudo sold 9,300 cars in 2018, ranking second among Chinese NEV startups after Nio. But after new rivals, including Xpeng Motors and Li Auto, emerged, Yudo's sales have been less impressive. It sold 5,300 units in 2021 and 4,700 cars in 2020.

Yudo made a loss of CNY55.7 million (USD8.4 million) in the first quarter of this year while its revenue was CNY6.6 million (USD999,318), its ex-shareholder Haiyuan Composites Technology disclosed. In 2021, its revenue was CNY67.8 million. But its loss was as high as CNY213 million (USD32.3 million).

The car company is losing some old shareholders. Haiyuan Composites Technology, one of the four founders of Yudo, said on April 13 that it is transferring its 11 percent stake in Yudo to Zhuhai Yucheng Investment Center for CNY22 million. It also said that the auto firm had suspended production in February due to financial troubles.

Yudo said on April 17 that the main reason for the suspension is a problem with batteries but that should ease with recently confirmed supply while production is expected to resume in June. Some analysts said that Juneyao's support could get the ball rolling by then.

Fujian Motor Industry Group, Putian State-Owned Assets Investment, Yudo’s management team, and Haiyuan jointly established Yudo with an investment of CNY900 million. Their respective stakes were 39 percent, 34.4 percent, 15.6 percent, and 11 percent.

Established in 1991, Juneyao has four listed firms, namely Juneyao Air [SHA:603885], financial services firm AJ Group [SHA:600643], yogurt drink retailer Juneyao Grand Healthy Drinks [SHA:605388], and Wuxi-based department store operator Commercial Mansion Grand Orient [SHA:600327].

Editor: Emmi Laine, Xiao Yi