NEW YORK: Ideanomics (NASDAQ: IDEX) ("Ideanomics" or the "Company"), has announced an agreement with Dasheng Licheng (Beijing) Financial Leasing Co., Ltd. to provide an innovative lease financing program for AAA+-rated state-owned entities (SOE's) and other enterprise fleet operators.
The Electric Vehicle (EV) commercial sector differs from traditional vehicle lease financing, which has been built on 100-plus years of residual values of combustion engine vehicles. The battery and battery storage in electric vehicles comprise a much higher percentage of the vehicle's overall value, both new and used, requiring a new structure of financing to avoid imposing increased upfront deposits on fleet operators. The agreement has been designed with a consortium of insurance companies as investing partners in order to make financing programs flexible enough to meet the needs of the burgeoning EV market.
"This is a very important agreement for our MEG division, and potentially a barrier to entry in the market for the lease financing of large-scale commercial EV fleets," said Alf Poor, CEO of Ideanomics. "By effectively plugging the gap between traditional lease financing and the financing solutions required by the EV industry, through the support of a consortium of China-based insurance companies as investors; we have engineered an innovative solution to meet market demand at scale. We anticipate coming to market in Q1, for those SOE's and enterprise customers rated as AAA or better, with the benefits seen from Q2 of 2020 forward. We're excited to be working with Dasheng Licheng's team on rolling this program out for the benefit of our commercial EV fleet customers and will be exploring ways to bring this type of solution to our other markets outside of China."
The insurance company partners include China Life, China Property Insurance, Pacific Insurance, Taiping Insurance, Ping An Insurance, and Urtrust Insurance. These partners have committed up to 100 Billion RMB for the Inner Mongolia heavy duty trucks replacement project.
Ideanomics' MEG division operates in 4 key segments of commercial EV, which are Heavy Duty commercial, for closed area environments, such as Mining, Steel Mills, Airports, and Seaports, Light commercial last-mile logistics vehicles, Buses and Coaches, and Taxis.