(Yicai Global) April 28 -- Baoneng Motor Group, the carmaking arm of struggling Chinese real-estate-to-finance conglomerate Baoneng Investment Group, has failed to deliver a batch of new energy vehicles to more than 300 dealers who had already paid for them.

Baoneng Motor's dealers did not receive any of the A3 cars, the first model of the firm's mini electric vehicle brand U-Belief, for which each paid about CNY1 million (USD144,660), some told Yicai Global. Since the start of this month, they have been visiting the automaker’s Shenzhen headquarters to try to resolve the issue.

U-Belief was launched last September. It was expected to release the A3 in the fourth quarter of last year but failed to do so because auto part makers stopped supplying the firm because of financial issues, a former Baoneng Motor staffer told Yicai Global.

Baoneng Motor has had difficulties since a debt crisis erupted at Baoneng Investment two years ago. The carmaker has delayed the payment of wages since the second half of 2021, employees informed Yicai Global.

According to an internal document obtained by Yicai Global, Baoneng Motor's sales company was CNY284.5 million (USD41.2 million) in arrears, including overdue salaries and benefit payments such as for social security to 5,696 workers as of early April.

Baoneng Investment forayed into the auto sector in 2017, when it founded Baoneng Motor and acquired Qoros Automotive. In 2020, it also bought Changan PSA Automobiles. But its auto business has stalled amid the company’s debt problems.

The debt crisis kicked off after its excessive expansion in the capital market, with the firm’s interest-bearing debt amounting to CNY191.8 billion (USD27.8 billion) at the end of 2021. Courts had made compulsory enforcements of over CNY34 billion (USD4.9 billion) against Baoneng Investment and its units as of last month.

Editors: Dou Shicong, Futura Costaglione