After Adani Group, World's First Flying Taxi Company Becomes Hindenburg Report's Fifth Target This Year
In its latest report, US based short seller Hindenburg research has accused Chinese startup EHang, which is known for being the world's first flying taxi company. The company's shares crashed more than 12% in a single day yesterday after the report came out.
After rattling the Adani group in January this year and then moving on to put allegations of fraud on Twitter's former CEO and co-founder Jack Dorsey, then American billionaire Carl Icahn, 35-year-old Russian Billionaire Timur Turlov, Nigeria¡¯s Tingo Group and US-based venture capital firm Nanban Ventures, a Chinese startup has become the latest target for Hindenburg research.
Who Is Hindenburg Research¡¯s Latest Target?
NEW FROM US:
¡ª Hindenburg Research (@HindenburgRes) November 7, 2023
EHang¡ªHollow Order Book And Fake Sales Make This China-Based eVTOL Company Last In Line For Takeoffhttps://t.co/KkrdQPxz6i $EH
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In its latest report, US-based short-seller Hindenburg Research has accused Chinese startup EHang, which is known for being the world's first flying taxi company. The company's shares crashed more than 12% in a single day yesterday after the report came out.
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What Are Hindenburg¡¯s Allegations Against The World¡¯s First Air Taxi Startup?
Hindenburg research¡¯s latest report accuses EHang of having a hollow order book and fake sales that make this China-based company last in line for takeoff. Mentioning the red flags regarding the company, Hindenburg Research¡¯s report mentions the following:
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-EHang is a $903 million market cap, China-based, Nasdaq-listed electric vertical take-off and landing aircraft company whose share price has surged more than 267% over the last year due to market excitement, a recently granted aircraft design certification from the Chinese government, and a 1,300+ unit pre-order book, suggesting imminent large-scale revenue.
-EHang has generated net losses since inception and currently trades at ~50.3x its tangible book value, a significant premium to competitors Joby Aviation (4.1x) and Archer Aviation (5.0x). Despite its premium valuation, EHang¡¯s flagship aircraft is outmatched by competitors on key performance metrics.
- Short on cash, in July 2023 EHang announced a $23 million capital raise led by a South Korean music producer who was previously put on an INTERPOL wanted list and sentenced to 2 years in prison for embezzling from a Korean company he founded, according to media reports.
-We found that 92+% of EHang¡¯s claimed 1,300+ unit preorder book is based on ¡°dead¡± or ¡°abandoned¡± deals, failed partnerships, and newly-formed customer entities with no discernible operations.
Click here for the complete report.
Also Read; Meet Nathan Anderson, The Man Behind Hindenburg Report
How Has The Startup Responded To Hindenburg's Allegations?
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EHang refuted the report by short-seller Hindenburg Research, stating it contains untrue statements and misinterpretation of information regarding the Company's business operations and financial conditions. The company emphasizes the strong interest and genuine demand from customers for its innovative eVTOL products, based on accumulated orders and pre-orders. EHang will continue to provide updates on its order pipeline, including significant new orders received after obtaining regulatory approvals.
When Was The Startup Founded?
Founded in the year 2014, Chinese startup EHang, which is the world's first air taxi startup, is the world¡¯s leading urban air mobility (¡°UAM¡±) technology platform company. Its mission is to make safe, autonomous, and eco-friendly air mobility accessible to everyone. EHang provides customers in various industries with unmanned aerial vehicle (¡°UAV¡±) systems and solutions: air mobility (including passenger transportation and logistics), smart city management, and aerial media solutions.
EHang unveiled the world's first passenger-carrying UAV in 2016, pioneering the emerging industry of UAM worldwide. On December 12, 2019, EHang was successfully listed on Nasdaq following an initial public offering, becoming the world¡¯s first publicly traded company in the UAM industry. In October 2023, EHang successfully obtained a Type Certificate (¡°TC¡±) for the EH216-S passenger-carrying UAV system issued by the Civil Aviation Administration of China (¡°CAAC¡±), marking the world¡¯s first TC for unmanned electric vertical take-off and landing aircraft (¡°eVTOL¡±). As the forerunner of cutting-edge UAV technologies and commercial solutions in the global UAM industry, EHang continues to explore the boundaries of the sky to make flying technologies benefit life in smart cities.
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