Tuesday, June 15, 2021

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SHANGHAI—Guests at a private August dinner hosted by billionaire entrepreneur Jack Ma were intrigued by a fellow diner who introduced himself as a humble car salesman.

It was Xu Jiayin, better known as the chairman of China Evergrande Group , the country’s biggest real-estate developer and one of China’s most indebted companies. At the time of the dinner Evergrande was just weeks away from a potentially devastating showdown with its creditors

If he was feeling desperate, Mr. Xu didn’t show it, according to one of the people present at the meal at one of Mr. Ma’s houses in Hangzhou, where Mr. Ma’s Alibaba Group Holding Ltd. is based. He was pitching his most audacious venture to date: a new electric-vehicle company that aims, according to its own public statements, to surpass Tesla Inc. and others in becoming the world’s “largest and most powerful” EV maker by 2025.

The Chinese government’s drive to make the country a world leader in electric vehicles has spawned dozens of startups jockeying for position in its small but fast-growing market. Mr. Xu’s unlikely fusion of car-making and property development, which he’s building from scratch, is the wildest of them all.

Evergrande’s Hong Kong-listed EV unit, China Evergrande New Energy Vehicle Group Ltd. , or Evergrande Auto, saw its market capitalization soar last month to roughly $87 billion, more than most global auto makers, including Ford Motor Co. and General Motors Co. , and four times the value of its own parent company—all without having sold a single vehicle.

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