JINHUA, China, Dec. 20, 2016 (GLOBE NEWSWIRE) -- Kandi Technologies Group, Inc. (the "Company" or "Kandi") (NASDAQ: KNDI ) today announced that the final results of the review of subsidy payments for electric vehicles (“EV”s) manufactured by Kandi Electric Vehicles Group Co., Ltd. (the “JV Company,” a 50/50 joint venture between Kandi and Zhejiang Geely Holding Group) from 2013 to 2014 were released. The results came from the Ministry of Finance of China, the National Development and Reform Commission, the Ministry of Industry and Information Technology of China, and the Ministry of Science and Technology of China (collectively, the “Government”). According to the final results, the Government will re-calculate subsidy payments for EVs that were manufactured during the 2013-2014 period pursuant to the 2016 subsidy eligibility guidelines. This re-calculation is the result of certain complications in the JV Company’s advanced reusable battery exchange model that necessitated further clarification to the Government. As a result of dialogue with the Government, the JV Company has made modifications to its battery exchange model and has obtained Government approval in February of 2016. Based on subsidy guidelines, our EV models were eligible to receive Government subsidies of RMB 50,000.00 (approximately USD 7,195.00) in 2013, RMB 47,500.00 (approximately USD 6,835.00) in 2014, and RMB 45,000.00 (approximately USD 6,475.00) in 2016 on a per car basis. Applying the 2016 subsidy eligibility guidelines for those EVs it manufactured from 2013 to 2014, the JV Company estimates it will need to write off approximately USD 6.6 million of previously recorded account receivables. EVs that were manufactured in 2015 and 2016 remain eligible for the same amount of Government subsidies.
Mr. Hu Xiaoming, Chairman and Chief Executive Officer of Kandi, commented, “after discussion with governmental authorities, the confusion surrounding the EVs manufactured and sold by the JV Company during 2013 and 2014 that used the reusable battery exchange model were finally properly resolved. Although our partner received a slight penalty from the Government, the JV Company itself incurred roughly USD 6.6 million in lost subsidies which converts into USD 3.3 million losses to Kandi on the equity method of accounting basis. The Government subsidy review did not cause the major losses, but it has had a significantly negative effect on our business this year; however, now that it is over, it may have a strong positive impact on healthy growth of the renewable energy vehicle industry in the future. Going forward, we will be able to focus on our core business expansion and we believe Kandi’s future growth will increase shareholder value.”
Note: All the currency conversions from RMB to USD referred to in this press release is based on the exchange rate of 1RMB = 0.1439 USD, published by www.xe.com on the date before the release of this press release.
About Kandi Technologies Group, Inc.
Kandi Technologies Group, Inc. (KNDI), headquartered in Jinhua, Zhejiang Province, is engaged in the research and development, manufacturing and sales of various vehicle products. Kandi has established itself as one of China's leading manufacturers of pure electric vehicle ("EV") products (through its joint venture), EV parts and off-road vehicles. More information can be viewed at the Company's corporate website at http://www.kandivehicle.com . The Company routinely posts important information on its website.
Safe Harbor Statement This press release contains certain statements that may include "forward-looking statements." All statements other than statements of historical fact included herein are "forward-looking statements." These forward-looking statements are often identified by the use of forward-looking terminology such as "believes," "expects" or similar expressions, involving known and unknown risks and uncertainties. Although the Company believes that the expectations reflected in these forward-looking statements are reasonable, they do involve assumptions, risks and uncertainties, and these expectations may prove to be incorrect. You should not place undue reliance on these forward-looking statements, which speak only as of the date of this press release. The Company's actual results could differ materially from those anticipated in these forward-looking statements as a result of a variety of factors, including the risk factors discussed in the Company's periodic reports that are filed with the Securities and Exchange Commission and available on the SEC's website ( http://www.sec.gov ). All forward-looking statements attributable to the Company or persons acting on its behalf are expressly qualified in their entirety by these risk factors. Other than as required under the securities laws, the Company does not assume a duty to update these forward-looking statements.
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Company Contact: Ms. Kewa Luo Kandi Technologies Group, Inc. Phone: 1-212-551-3610 Email: IR@kandigroup.com
