Beijing CH-Auto Technology Co., which started out in 2003 as a designer of cars, has clinched one of China’s coveted permits to build electric vehicles, according to people with knowledge of the approval process.
The National Development and Reform Committee, which regulates China’s automobile industry, has given CH-Auto permission to assemble electric cars, according to the people, who asked not to be identified because the matter is private. That follows earlier approvals for Beijing Electric Vehicle Co. and Hangzhou Changjiang Passenger Vehicle Co., as China considers limiting the number of startup EV makers to a maximum of 10.
CH-Auto, whose shares have been listed on China’s over-the-counter board since the second half of 2015, extended gains to 8.9% by the close of trading Tuesday, the biggest rise since July 29. An NDRC official in charge of permit’s application process declined to comment. A spokesman for CH-Auto couldn’t immediately be reached for comment.
China has been issuing production licenses to newcomers to the auto-making industry as part of its push to encourage innovation. Companies from Internet video billionaire Jia Yueting’s Le Holdings Co. to startup WM Motor, founded by a former top executive of Zhejiang Geely Holding Group Co., have raised billions in a bid to enter the market.
CH-Auto’s Qiantu Motor unit is building a factory in the eastern city of Suzhou to produce the electric car with a carbon-fiber body and aluminum frame, its Chairman Lu Qun said in an interview earlier this year. Named the K50, it will debut next year with a starting price of about 700,000 yuan ($105,000), he said, comparable to Tesla’s aluminum Model S.