EHang Holdings Limited (Nasdaq: EH) (“EHang” or the “Company”), the world’s leading autonomous aerial vehicle (“AAV”) technology platform company, releases additional details to rebut the allegations made by the short-seller, Wolfpack Research, concerning its relationship with a customer, Shanghai Kunxiang Intelligent Technology Co., Ltd. (“Kunxiang”):
Kunxiang is one of EHang’s customers but it is not a related party of EHang. Kunxiang had never been a shareholder of EHang prior to its IPO. Kunxiang has never purchased any shares from EHang after its IPO. Although any person can purchase EHang’s ADSs from the open market after EHang becomes a public company, EHang has no knowledge that Kunxiang has ever purchased any of EHang’s ADSs, and EHang does not believe Kunxiang holds any meaningful shares whatsoever in the Company at any given time.
On February 1, 2019, EHang entered into a sales contract with Kunxiang to sell 3 units of EHang 216 passenger-grade AAVs for a total price of RMB4.5 million, or RMB1.5 million per unit (inclusive of value-added tax). EHang has posted a copy of this contract as well as its English translation on its IR website: https://ir.ehang.com/shareholder-services/investor-faqs.
Pricing and other terms provided by EHang to Kunxiang are not substantially different from those offered to other customers in China and all contracts with Kunxiang are based on arm-length transactions. The average unit price under EHang’s February 2019 contract with Kunxiang is in line with the average unit price for the Company’s overall passenger-grade AAV sales since 2019. Although the Company has not directly disclosed the average selling price of its passenger-grade AAVs in its public filings, such average selling price can be inferred from two metrics the Company does publicly disclose: (i) the number of passenger-grade AAVs sold in a period, and (ii) the amount of revenues generated by air mobility solutions, which have mostly been derived from the sales of passenger-grade AAVs, in the same period.
While it is not EHang’s place to comment on its customer’s office buildings or employees, Kunxiang has confirmed to EHang that the allegations made by the short-seller concerning Kunxiang or its employees in this so-called research report are false and misleading. Just for an example, the Wolfpack Research told an outright lie that the office building where Kunxiang is located only has 11 floors by showing an office building index, but a simple site visit will tell you that building indeed has 15 floors.
Kunxiang remains as an important customer of EHang. EHang appreciates that Kunxiang has the vision to be an early adopter of EHang future-defining products and EHang intends to strengthen its relationship with Kunxiang. However, Kunxiang is no longer the largest customer of EHang in the fiscal year ended December 31, 2020.
As EHang has previously stated, Wolfpack Research’s report was based on shoddy research and contains numerous, unsubstantiated statements, and misinterpretation of information. EHang intends to engage legal counsel to pursue legal actions against Wolfpack Research for its malicious act and false allegations.
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