Company Overview - Kaixin Holdings is a Cayman Islands holding company, conducting operations in mainland China through its PRC subsidiaries[27]. - The company has a limited operating history in the automobile sales business, having transitioned from an internet-based financing model to a used car retailer since its formation in 2011[53][54]. - As of December 31, 2024, the company had a network of three Dealerships, which has not expanded since May 2018, posing challenges for growth in a diverse market[60]. Financial Performance - The company incurred net losses of US$84.6 million, US$53.6 million, and US$41.0 million in 2022, 2023, and 2024, respectively, with accumulated deficit reaching US$377.5 million as of December 31, 2024[50][51]. - Cash outflows from operating activities were US$2.4 million, US$2.1 million, and US$3.0 million in 2022, 2023, and 2024, respectively[50]. - The company recorded selling and marketing expenses of approximately US$2.1 million, US$3.3 million, and US$1.0 million in 2022, 2023, and 2024, respectively[74]. Regulatory Environment - The company faces significant legal and operational risks due to evolving PRC laws and regulations, which could adversely affect its operations and the value of its ordinary shares[30]. - The PCAOB has been able to conduct inspections of registered public accounting firms in mainland China and Hong Kong, reducing the risk of being identified as a "Commission-Identified Issuer" under the HFCAA for the fiscal year ended December 31, 2024[43]. - The company must comply with extensive licensing and permit requirements in the PRC, which are subject to evolving regulations and uncertainties[186]. Capital and Funding - The company intends to retain most of its available funds and future earnings to operate and expand its business[39]. - Future securities offerings may require compliance with new CSRC filing procedures, which could limit the company's ability to raise capital[31]. - The company may need additional capital to pursue business objectives, and financing may not be available on acceptable terms[47]. Risks and Challenges - The company faces risks related to its corporate structure, including the potential inability to transfer cash or assets due to PRC government restrictions[47]. - Regulatory uncertainties in China could materially impact the company's operations and financial condition, including potential trading prohibitions on its shares[48]. - The company may continue to incur significant losses in the near term due to investments aimed at business growth and potential changes in market conditions[52]. Market and Competition - The automotive retail market in China is highly dynamic, and the company must adapt to changing consumer preferences and economic conditions to maintain growth[68]. - Economic conditions, including inflation and consumer sentiment, could adversely affect vehicle demand and the company's financial results[76]. - The company is sensitive to changes in government subsidies and economic incentives for NEVs, which significantly impact future sales growth[103]. Cybersecurity and Data Protection - The company relies on information systems for operations, and any failure or security breach could materially harm its business and financial performance[82]. - The company is exposed to risks related to data security and compliance with evolving regulations, which could increase operational costs and affect its reputation[80]. - The PRC Cybersecurity Law requires network operators to implement security measures to protect against unauthorized access and data breaches[160]. Corporate Governance and Compliance - The company has identified material weaknesses in its internal control over financial reporting, including inadequate technical competency of financial staff and lack of effective risk assessment procedures[116]. - The company has not faced any material administrative penalties from PRC regulatory authorities, but future compliance with laws and regulations remains uncertain[191]. - The SEC has increased regulatory scrutiny on companies with substantial operations in China, potentially raising compliance costs and complicating capital-raising efforts[178]. Acquisitions and Growth Strategy - The acquisition of Morning Star was completed on August 22, 2023, enhancing the company's position in the new energy vehicle sector with the POCCO brand[63]. - The company established a New Energy Vehicles Department in 2021 and produced a NEV prototype, delivering it to customers by the end of 2022[99]. - The company may face significant dilution if it raises additional funds through equity or convertible debt securities[66]. Currency and Foreign Exchange - Fluctuations in the Renminbi against the U.S. dollar could materially impact the company's financial results and the value of its ordinary shares[192]. - Government controls on currency conversion may limit the company's ability to utilize revenues effectively and affect the value of its ordinary shares[196]. - The PRC government has imposed more restrictive foreign exchange policies, which may affect the company's ability to pay dividends in foreign currencies[197].

Group 1 - Kaixin Holdings will implement a share consolidation at a ratio of 1-for-60, effective October 25, 2024 [1][2] - Following the consolidation, every sixty shares will be converted into one ordinary share, with no fractional shares issued [2] - The company's shares will continue trading on The Nasdaq Capital Market under the symbol "KXIN" with a new CUSIP number [1][2] Group 2 - Kaixin Holdings is a leading new energy vehicle manufacturer in China, focusing on electric passenger and logistics vehicles [3] - The company aims to establish a competitive international market position through integrated online and offline operations [3] - Kaixin is committed to innovation and sustainability, contributing to the goals of peak carbon emissions and carbon neutrality [3]

Vehicle Sales and Market Presence - The company sourced, marketed, and sold approximately 1,814, 879, and 525 vehicles to customers across China in 2021, 2022, and 2023, respectively[226]. - The company operates three dealerships across three cities in China, focusing on premium brands such as Audi, BMW, and Mercedes-Benz[224]. - In 2023, the company operated three Dealerships, focusing on tier 2 and below cities to leverage favorable growth opportunities[231]. - The company sold approximately 1,814, 879, and 525 new and used vehicles in 2021, 2022, and 2023, respectively[332]. - The demand for premium passenger vehicles in China significantly affects the company's revenues, influenced by macro-economic conditions, urbanization, and household income levels[335]. Strategic Partnerships and Acquisitions - The company aims to establish a joint export trading platform for new energy vehicles with a target total transaction volume of USD 10.8 billion over the next five years[227]. - The company has entered into a strategic partnership with Beijing Bujia Technology Co., Ltd. for 5,000 new energy logistics vehicles, with a total order value of approximately RMB 1 billion (around USD 156 million)[227]. - The company completed the acquisition of Haitaoche, issuing 74,035,502 ordinary shares in exchange for 100% of Haitaoche's share capital, resulting in Haitaoche becoming a wholly-owned subsidiary[218]. - The acquisition of Morning Star Auto Inc. was completed on August 22, 2023, allowing the company to own all assets related to POCCO EVs[238]. - The company plans to establish strategic partnerships with platforms that have significant sales potential, targeting a total transaction volume of USD$10.8 billion in the next five years[343]. Financial Performance and Revenue - The company generated 100% of its revenues from auto sales in 2021, 2022, and 2023, following the Haitaoche Acquisition in June 2021[230]. - In 2021, the company's car sales revenue was US$253.8 million, which decreased to US$82.8 million in 2022 and further declined to US$31.5 million in 2023[345]. - Total revenues decreased from US$82.8 million in 2022 to US$31.5 million in 2023, primarily due to a decline in auto sales volume[364]. - The company reported total operating expenses of US$187.9 million in 2021, which decreased to US$48.6 million in 2022 and further to US$21.3 million in 2023[353]. - Net loss was US$84.6 million in 2022 and US$53.6 million in 2023[369]. Operational Changes and Corporate Structure - The company has streamlined its corporate structure by disposing of inactive shell companies and VIE structures, eliminating regulatory risks and maintenance costs[222]. - The company has terminated cooperation with underperforming dealerships, reducing its network to three[230]. - The company has developed a systematic evaluation process for selecting new Dealership locations, considering factors like population density and average disposable income[232]. - The company identified four material weaknesses in internal control over financial reporting, including inadequate technical competency of financial staff[392]. Marketing and Customer Engagement - The company has invested heavily in online sales channels, enhancing its competitive advantage over traditional and online-only competitors[250]. - Customer engagement is primarily through Dealerships, the company's website, mobile apps, and third-party advertising platforms, affecting the expansion of the customer base[337]. - The company anticipates future marketing expenses to focus on performance-based advertising, primarily in vertical automotive media and selected online channels[253]. - The company has a consultative approach to customer support, providing assistance throughout the car purchase process, which has led to strong customer referrals[254]. Regulatory Compliance and Legal Matters - The company is subject to various PRC regulations regarding used automobile trading, requiring verification of background information for sales[261][262]. - The Measures on Sales of Automobile require suppliers and distributors to provide timely after-sales services and ensure consumer rights[265]. - The company must comply with strict regulations regarding illegal fund-raising to avoid administrative and criminal liabilities[275]. - The Foreign Investment Law, effective January 1, 2020, replaced previous laws and aims to unify corporate legal requirements for foreign and domestic investments[278]. Financial Position and Future Outlook - The company expects to fund future growth through additional debt and/or equity financing from both Chinese and international investors[344]. - The company intends to obtain additional equity or debt financing to support business growth, but there is no assurance that financing will be available on acceptable terms[379]. - Cash and cash equivalents at the end of 2023 were approximately US$2.1 million[378]. - The company plans to reinvest all earnings from its PRC subsidiaries into business developments and does not plan to request dividend distributions[391].

Core Insights - Kaixin Auto Holdings has signed an export order with Myanmar New Power Motor Co., Ltd. for 1,000 new energy vehicles in SKD mode, marking a significant step in its international expansion [1][2] - The cooperation aims to leverage the favorable business environment for new energy vehicles in both China and Myanmar, with plans to enhance automobile trade between the two countries [2][3] - As China became the world's largest automobile exporter in 2023, the Chinese auto industry is focused on stimulating overseas new energy vehicle markets [3] Company Overview - Kaixin Auto Holdings is a leading new energy vehicle manufacturer in China, with expertise in R&D, production, and marketing, and facilities capable of stamping, welding, painting, and assembly [4] - The company produces various electric passenger and logistics vehicle models and aims to establish a competitive international market position through integrated online and offline operations [4] - Kaixin is committed to innovation and sustainability, contributing to the goals of peak carbon emissions and carbon neutrality [4]

Core Viewpoint - Kaixin Auto Holdings has received a notification from Nasdaq regarding non-compliance with the minimum bid price requirement, but it retains its listing status and has a 180-day period to regain compliance [1][2]. Group 1: Nasdaq Compliance Notification - Kaixin Auto Holdings was notified by Nasdaq that it failed to maintain a minimum bid price of $1 per share for 30 consecutive business days ending January 31, 2024 [1]. - The company has until July 30, 2024, to regain compliance with the minimum bid price requirement [1][2]. - If the closing bid price reaches at least $1.00 per share for 10 consecutive business days before the deadline, Nasdaq will confirm compliance [1]. Group 2: Additional Compliance Period - If Kaixin does not regain compliance by July 30, 2024, but meets other initial inclusion criteria, it may receive an additional 180-day compliance period [2]. - Failure to comply by the deadline without eligibility for an extension will result in a written notification of delisting from Nasdaq [2]. Group 3: Company Overview - Kaixin Auto Holdings is a prominent new energy vehicle manufacturer in China, focusing on R&D, production, and marketing [3]. - The company produces various electric passenger and logistics vehicle models and aims to establish a competitive international market position [3]. - Kaixin is committed to sustainability goals, including achieving peak carbon emissions and carbon neutrality [3].

Group 1 - Kaixin Auto Holdings will hold its annual general meeting of shareholders on March 4, 2024, at 10:00 a.m. Beijing time [1] - The record date for ordinary shares is set as February 2, 2024, allowing holders of record to attend and vote at the AGM [1] - The company has filed its annual report on Form 20-F for the fiscal year ended December 31, 2022, with the U.S. SEC [2] Group 2 - Kaixin Auto Holdings is a leading new energy vehicle manufacturer in China, focusing on R&D, production, and marketing [3] - The company produces various electric passenger and logistics vehicle models and aims to enhance its international market position [3] - Kaixin is committed to innovation and sustainability, contributing to the goals of peak carbon emissions and carbon neutrality [3]

Company Overview - Kaixin Auto Holdings is a leading new energy vehicle manufacturer and sales platform in China, focusing on electric passenger and logistics vehicles [3] - The company aims to achieve a competitive international market position by integrating online and offline operations and diversifying its business [3] - Kaixin is committed to sustainability goals, specifically "peak carbon emissions and carbon neutrality" [3] Leadership Appointment - Mr. Xiaoning Wu has been appointed as a director and chairman of the audit committee of Kaixin's Board, effective January 30, 2024 [1] - Mr. Wu is recognized as a "financial expert" under Nasdaq Stock Market Rule 5605(a)(2) and Rule 10A-3 under the Securities Exchange Act of 1934 [1] - He has extensive experience in corporate financial management and capital investments, having served in various leadership roles since 1986 [2]

Strategic Cooperation - Kaixin Auto Holdings has reached a strategic cooperation intention with DeepBlue AI Technology to establish a joint venture for developing AI autopilot EVs [1] - The joint venture aims to leverage DeepBlue AI Technology's autonomous driving technology on Kaixin's mass-produced EV models [1] - The collaboration will focus on market-oriented operations for the new generation of AI autopilot EVs [1] DeepBlue AI Technology Overview - DeepBlue AI Technology was founded in 2014 by senior engineers with doctoral degrees and is committed to AI research and application [2] - The company has multiple research institutes, including AI, Smart Car, Automation, and Scientific Computing, with over 50 world championships and 120 top-three awards in AI-related competitions [2] - DeepBlue AI Technology operates in industries such as intelligent driving, smart vehicles, and smart cities, and has been recognized as a national-level specialized and emerging baby giant enterprise [2] - The company has been selected into the "Global 500 Artificial Intelligence Unicorns" for two consecutive years and the "Hurun Global 500 Unicorns" in 2023 [2] DeepBlue AI Technology's Autonomous Driving Capabilities - DeepBlue AI Technology possesses L4 autonomous driving technology and smart car forward design capabilities [3] - The company holds autonomous driving test licenses issued by multiple cities and obtained the first batch of autonomous driving commercial licenses in China with Baidu [3] - DeepBlue's self-driving Panda buses have been tested and demonstrated in over ten cities, including Shanghai, Shenzhen, and Wuhan [3] - The company has launched self-driving sanitation vehicles, logistics vehicles, and other products, establishing itself as a leader in AI-driven automotive innovation [3] Kaixin Auto Holdings' Vision - Kaixin's Chairman and CEO, Mingjun Lin, emphasized that AI vehicles are the future trend and that the collaboration with DeepBlue AI Technology will significantly boost Kaixin's AI vehicle development efforts [4] - The partnership aims to create intelligent, safe, and efficient car travel products and services [4] Kaixin Auto Holdings Overview - Kaixin Auto Holdings is a leading new energy vehicle manufacturer in China with expertise in R&D, production, and marketing [5] - The company has production facilities capable of stamping, welding, painting, and assembly operations, producing multiple electric passenger and logistics vehicle models [5] - Kaixin is committed to building a competitive international market position by integrating online and offline presence and diversifying business operations [5] - The company aims to contribute to achieving "peak carbon emissions and carbon neutrality" goals through innovation and sustainability [5]

Group 1 - Kaixin Auto Holdings has received an intention order to export 1,000 new energy vehicles in SKD mode to New Power Auto in Myanmar, with the first batch of 100 vehicles to be shipped shortly [1] - Kaixin has secured a five-year authorization from New Power Auto as its strategic partner for exporting complete and SKD vehicles from China [1] - New Power Auto, founded in 1982, operates in various sectors including automotive trade, manufacturing, and logistics, and has established a strong market presence in Myanmar [1] Group 2 - The chairman and CEO of Kaixin, Mr. Mingjun Lin, emphasized that new energy vehicles are a key driver for China's automobile export growth and that this partnership represents a significant business breakthrough for the company [2] - Kaixin's strategic focus for 2024 includes overseas expansion into new markets [2] Group 3 - Kaixin Auto Holdings is recognized as a leading new energy vehicle manufacturer in China, with a strong emphasis on R&D, production, and marketing [3] - The company produces various electric passenger and logistics vehicle models and aims to enhance its competitive international market position [3] - Kaixin is committed to innovation and sustainability, contributing to the goals of peak carbon emissions and carbon neutrality [3]

Business Operations - As of December 31, 2022, the company operated three used car dealerships across three cities in China, focusing on premium brands such as Audi, BMW, and Mercedes-Benz[432]. - The company sold approximately 879 new and used vehicles in 2022, a decrease from 1,814 vehicles sold in 2021[433]. - The competitive landscape in the used car industry in China is highly fragmented, with trends towards consolidation and increased online technologies affecting market dynamics[439]. - Total revenues decreased from US$253.8 million in 2021 to US$82.8 million in 2022, primarily due to the closure of several dealerships[464]. - The company aims to expand into the electric vehicle market and has released a strategic plan for new energy vehicles targeting commercial applications[442]. Financial Performance - Revenues from car sales were $82.8 million in 2022, down from $253.8 million in 2021, indicating a decline of approximately 67.5%[445]. - The cost of revenues for car sales in 2022 was $82.2 million, which is consistent with the total revenues, resulting in a gross margin of 0%[449]. - Operating expenses for 2022 totaled $48.6 million, with selling and marketing expenses accounting for approximately 4.3% of total operating expenses[456]. - The company recorded a full impairment loss of $143.7 million in goodwill for the year ended December 31, 2021, impacting financial results significantly[454]. - Gross profit declined from US$5,257 thousand in 2021 to US$646 thousand in 2022[466]. - Total operating expenses decreased from US$187.9 million in 2021 to US$48.6 million in 2022, mainly due to a one-time loss from goodwill impairment of US$143.7 million[467]. - Net loss was US$195.9 million in 2021 and US$84.6 million in 2022[469]. - Cash flows from operating activities were negative, amounting to US$2.4 million in 2022, with significant losses from impairment and provisions[486]. Financing and Capital Structure - The company has historically funded operations through various means, including ABS issuance and term loans, and anticipates future growth will involve additional financing[444]. - The company intends to seek additional equity or debt financing to support business growth[484]. - Cash and cash equivalents at the end of 2022 were approximately US$7.1 million[485]. - Net cash used in financing activities was US$5.4 million in 2022, primarily from proceeds of US$4.7 million from ordinary shares and US$2.0 million from a convertible note, offset by US$2.0 million in offering costs[490]. - The company has long-term borrowings totaling US$2.0 million, maturing in August 2023, and two convertible notes of US$2.0 million maturing in May 2023 and October 2023[494]. Employee and Management Structure - The company had 27 employees as of December 31, 2022, with 78% in management and administration, 4% in sales and marketing, and 18% in research and development[554]. - The company plans to hire additional experienced employees in areas such as new energy vehicles design and manufacturing, big data analytics, marketing, operations, risk management, and sales as it expands its business[555]. - The total compensation paid to directors and executive officers for the fiscal year ended December 31, 2022, was approximately US$396 thousand[525]. - The company has entered into employment agreements with each executive officer, allowing termination for cause without advance notice[526]. Corporate Governance - The company has established three committees under the Board: an audit committee, a compensation committee, and a nominating and governance committee[546]. - The audit committee is chaired by Lin Cong, who is recognized as an "audit committee financial expert" and oversees the company's accounting and financial reporting processes[547]. - The compensation committee, also chaired by Lin Cong, is responsible for reviewing and approving the compensation structure for directors and executive officers[548]. - The board of directors currently consists of five members, with specific rights for Mr. Mingjun Lin and Renren to appoint and remove directors[545]. Shareholder Rights and Equity Plans - The company is listed on the Nasdaq Capital Market under the symbol "KXIN"[595]. - Shareholders are entitled to dividends as declared by the Board, with no dividend exceeding the amount recommended by directors[598]. - Each ordinary share grants one vote at general meetings, with a simple majority required for ordinary resolutions and two-thirds for special resolutions[600]. - The company may issue additional ordinary shares as determined by the Board, which may dilute the voting power of existing shareholders[609]. - The 2020 equity incentive plan allows for the grant of up to 5,000,000 ordinary shares as awards[528]. - The 2021 equity incentive plan permits the grant of up to 26,596,000 ordinary shares as awards[532]. - The 2022 equity incentive plan provides for the grant of up to 39,500,000 ordinary shares as awards[538]. Legal and Compliance Matters - The company identified four material weaknesses in internal control over financial reporting, including inadequate technical competency and lack of effective risk assessment[498]. - The company has not entered into any financial guarantees or derivative contracts that are indexed to its shares[491]. - The company did not recognize any income tax due to uncertain tax positions or incur any interest and penalties related to potential underpaid income tax expenses for the years ended December 31, 2020, 2021, and 2022[518]. - The company has agreed to indemnify Renren against liabilities arising from misstatements in SEC filings related to the Business Combination[569]. Future Plans and Strategic Initiatives - The company plans to reinvest all earnings from its PRC subsidiaries into business developments and does not plan to request dividend distributions[497]. - The company signed a sales order for 5,000 new energy logistics vehicles worth RMB1 billion (approximately $156 million) with Bujia, a leading automobile logistics service provider in China[443].