SHANGHAI — In 2015, Beijing started reining in domestic real estate investments in a bid to cool the overheated housing market. This year, the government has further tightened control on property development in China's major cities.
The policy shift has sent real estate developers searching for business opportunities in other sectors, and an increasing number of them have placed a bet on electric vehicles.
Among the investments real estate development companies have made in EV makers, the one that has attracted the most attention in China was carried out by China Evergrande Group, China's second-largest property developer ranked by sales.
And the target company — Faraday Future — is an EV startup founded by Chinese entrepreneur Jia Yueting in Los Angeles. Until two months ago, Faraday Future was teetering on the verge of bankruptcy from a severe cash crunch.
Evergrande came to his rescue. In June, the real estate giant arranged for a subsidiary, Evergrande Health Industry Group, to acquire 45 percent of Faraday Future for 6.7 billion Hong Kong dollars (5.9 billion yuan).
On Aug. 14, Evergrande Health opened Evergrande FF Intelligent Automotive (China) Co., in the south China city of Guangzhou with registered capital of $2 billion (13.8 billion yuan).
Faraday Future started assembling its first vehicle, the FF 91 luxury crossover, at a leased plant in Hanford, Calif., in August. And Evergrande FF is expected to start producing the vehicle at a factory under construction in Guangzhou in the near future.
Before Evergrande Group, two other major Chinese property developers had diversified with forays into the domestic EV industry.