(Yicai) Nov. 18 -- Hycan Automobile Technology, a struggling new energy vehicle startup backed by Chinese automotive giant GAC Group, has closed its Shanghai branch and missed the deadline for severance pay for the staff made redundant.

Hycan said it would pay the severance packages by Oct. 31, but they are more than two weeks overdue, several former employees of the carmaker's Shanghai branch told Yicai yesterday. “They keep delaying the compensation,” one said.

Guangzhou-based Hycan has downsized to about 50 workers who maintain basic operations at its headquarters in Nansha district, according to ex-staffers, adding that the firm is reportedly planning a restructuring.

Hycan did not respond to Yicai for more information on the matter.

Hycan sales plunged 82 percent to just 110 units last month from a year earlier and 83 percent to 4,388 units in the 10 months ended Oct. 31, according to data released by GAC. 

In early September, Shanghai’s market supervision administration added Hyman’s Shanghai branch to its “abnormal operations” list after not being able to contact the carmaker at its registered address in the city.

GAC and Nio set up GAC-Nio in 2018, which was renamed as Hycan in 2021 after Pearl River Investment Management Group became its largest shareholder. Nio's stake in the joint venture was diluted to 4.5 percent before the electric car startup sold its remaining shares in 2022.

GAC owns a 4.5 percent stake in Hycan, while its NEV arm, GAC Aion, holds 21 percent. The JV produces four pure EV models priced between CNY100,000 and CNY400,000 (USD13,800 and USD55,200) each.

Editors: Tang Shihua, Martin Kadiev