Growing financial problems at Chinese internet group Leshi Holding, also known as LeEco, has cast doubt on the company's ambitious plans to break into the electric vehicle market.
The company's billionaire founder, Jia Yeuting, has stepped down as the legal representative of the company after his shares were frozen by a Chinese court in April. The company is struggling to pay off a huge debt burden, with Jia having to put his shares up as collateral to secure loans.
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Leshi, which includes the Shanghai-listed video-streaming internet company Leshi Internet Information and Technology Corporation, has expanded aggressively in recent years in areas such as real estate, smart phones and smart TVs.
Last August the company announced plans to become a large volume manufacturer of high tech electric cars with a CNY20bn (US$2.94bn) investment in a 400,000 units a year plant in Huzhou, Zhejiang province.
These plans, along with an agreed alliance with the UK's Aston Martin Lagonda in the premium sports car segment, look to have been shelved until further notice.
The company has spent huge amounts on developing sports concept cars to rival Tesla without funding for production and commercialisation.
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