- KXIN stock soared around 45% this morning on news of a partnership with China's ‘Camping Club'
- The 20,000 EV deal is worth around $938M and is to be completed over the next 5 years
- The deal is part of the Camping Club's new energy RV endeavour
Shares of Kaixin Auto (NASDAQ: KXIN) skyrocketed over 45% in Monday’s premarket trading, with investors reacting kindly to the company’s announcement of a strategic partnership with Beijing Camping Club Sports and Culture Communication Co for the agreed purchase of at least 20,000 electric vehicles from Kaixin over the course of the next five years. At an estimated total value of $938M, it’s no surprise that buyers are so active this morning.
The ‘Camping Club’ is a prominent Chinese tourism platform promoting grass-roots leisure activities and modern sports, as well as promoting China’s camping industry through a nationwide web of tourist locations. The Club has implemented around 1,000 camping bases and has apparently played a critical role in advancing the sports and leisure industry across the country.
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What does this all have to do with Kaixin? Well, the Chinese transport market is one step ahead of the US when it comes to widespread renewable energy. In line with the booming new energy industry, Camping Club seeks to shift its focus toward the long-term procurement of new energy RVs, promoting the eco-shift whilst securing future business growth. It’s estimated that China’s camping and RV travel industry will be the next trillion-dollar business segment, supported by China’s tourism development policy.
Mr. Mingjun Lin, Chairman and CEO of Kaixin, stated: “The new energy vehicle business of Kaixin will focus on securing large orders from our strategic partners, accelerating growth of overall business scale through the integration of different scenarios, transboundary cooperation, and cross-industry joint innovations.”
As stated by the CEO, securing large corporate and commercial contracts for long-term viability will bolster the company’s strategic vision, help secure consistent cash flow, and support the scaling of the business in the future. KXIN stock is down 51% year on year, but shares could see a turnaround should the company continue to secure large-scale contracts for EVs.