The early winter of 2022 may be the most "depressing" winter in the autonomous driving industry.
On October 27, the day of Mobileye's waist market, self-driving company Argo AI declared bankruptcy. Then, on November 1, Tucson Future, once the "first stock of autonomous driving", was exposed to founder Hou Xiaodi, who is also the CEO, CTO, president and chairman.
The company's head of operations, Ersin Yumer, will serve as interim CEO and president, and the company will simultaneously search for a suitable CEO successor, with board member Bradbas named as the new chairman. After the news, Tucson Future's stock plunged 46% to close at $3.43.
Mobileye, Argo AI, and Tucson's future "one-key triple" operation has made the entire industry feel the cold of this winter. China's autonomous driving companies that "watch the fire from the other side" have mixed feelings in their hearts. Can the road to listing in the United States still work?
Geniuses fall into the American trap with precision
After Hou Xiaodi was "fired", everyone quickly picked up the ins and outs of this matter:
Tucson's future board of directors also explained the decision in an email: "Fundamentally, we have lost trust and confidence in Dr. Hou's judgment, decision-making and ability to lead the company as CEO, a decision related to an investigation initiated by the Board's Audit Committee in July, which ultimately agreed that terminating Hou Xiaodi was necessary and in the best interests of shareholders." ”
In the face of the "accusations" of the board of directors, Hou Xiaodi personally issued a "shouting of grievances": he believes that he fully cooperates with the directors and does not hide anything, and he also believes that the removal of the company's directors from his position is questionable in terms of process and conclusion.
The trigger for this incident is mainly related to the recent entrepreneurship of another co-founder of Tucson Future, Chen Mo, who previously founded hydrogen fuel cell truck company Hydron (Turing Intelligent Card), which is committed to developing, manufacturing and selling hydrogen-powered trucks equipped with L4 autonomous driving technology.
At present, the FBI, the Securities and Exchange Commission and the Committee on Foreign Investment in the United States are investigating the relationship between Tucson Future and Hydron, and the investigation of the US federal department seems to be inclined to believe that due to the support of Chinese investors behind Turing, the cooperation and technical exchanges between Tucson and it have not been properly disclosed, in violation of securities trading and foreign investment review related acts.
In this way, Hou Xiaodi has worked hard since 2015 and raised the "child" with his dream, so he has nothing to do with himself. Among the many identities associated with Hou Xiaodi and Tucson, only the "co-founder" remains.
But in recent years, with the Sino-US cutting of autonomous driving technology, Tucson will come under multiple scrutiny from the US government as a company across China and the United States, and in order to be able to "comply", Tucson has signed a national security agreement with the US government, which includes the removal of two Chinese directors from the board of directors, the agreement to restrict access to certain data and adopt a technical control plan, the company appoints a security officer and security director, and regularly meets with and reports to CFIUS regulators.
Behind the trap, data security is becoming more and more important
Hou Xiaodi's dismissal has become a landmark event of tightening scrutiny by the US government, which also shows that autonomous driving technology, as one of the core of the future automotive industry, has been closely regulated by the US government. In particular, Chinese autonomous driving companies with R&D and test centers in China and the United States are the top priority of the US government's supervision.
According to data from the California Department of Motor Vehicles, by the end of 2021, WeRide had 14 test vehicles and 44 AutoX vehicles in California. In addition to Wenyuan, autonomous driving companies with Chinese backgrounds such as AutoX and Didi Autonomous Driving also have R&D teams and test vehicles in the United States.
These companies are already on the U.S. government's regulatory list.
In addition, the Foreign Company Accountability Act passed by the US House of Representatives and Senate in 2020 clearly states that if the US Public Company Accounting Oversight Board (PCAOB) fails to audit the company for three consecutive fiscal years, Chinese concept stocks will be included in the delisting list. The Foreign Company Accountability Act primarily seeks audit papers from foreign companies, although most foreign companies originally placed audit papers under territorial jurisdiction.
Usually, financial reports can be tens to hundreds of pages at most, but "audit papers" are the carriers of audit data, including audit strategies, audit plans, summaries of major matters and correspondence, as well as documents for communicating with important people such as accountants, lawyers, and experts. Just like a dashcam, it records the audit process in detail, from written statements and management proposals of the audited enterprise, to letters (including emails) related to major matters, and even the minutes of meetings held between the project team and the audited unit.
To put it more bluntly, the audit paper is actually a top-secret document of a listed company, and even when the company is involved in some business and reaches a certain volume, the audit paper is "confidential" to the state.
For autonomous driving companies with R&D and test teams in both China, their audit papers may contain key information from both the United States and China. If China's autonomous driving companies want to list in the United States, there may be only one way in the future, that is, to completely cut off from China and become an American company. Tucson Future is a very concrete example.
The road to listing of Chinese autonomous driving companies in the United States
The way for Chinese self-driving companies to go public in the United States seems to be blocked. Walking past was accompanied by flowers, applause, and a steady stream of money, and now, walking through it is likely to be a trap.
However, in the face of the experience of the past of Ming Huanghuang, there may still be companies that want to "try".
After all, the speed of self-driving companies burning money is obvious to all, investors blindly invest money, and it is easy to lose information in sight, and China's A-share market has strict profit requirements for listed companies.
Recently, an insider revealed that WeRide is "silently" accelerating the process of listing in the United States, and may submit a listing application before the end of this year at the earliest, and is expected to IPO in the first quarter of next year.
If an insider reveals that it is true, then it would have been a cause for celebration, but in the current context, it has become even more intriguing. At present, the company has submitted a written application to the International Department of the China Securities Regulatory Commission in early October this year, and relevant people close to Wen Yuan pointed out that founder and CEO Han Xu also went to the United States to find capital support.
As early as August this year, Bloomberg exposed the news that Wen Yuan went public in the United States, with a pre-financing amount of $500 million. However, Wen Yuan Zhixing quickly refuted the rumors at that time, saying that there was no specific listing plan for the time being, and the progress would be announced in due course. It is reported that the amount of funds raised by Wenyuan this time is far lower than expected, which may be less than 100 million US dollars.
Can Wenyuan finally successfully go public in the United States? Perhaps in the first quarter of next year, we will see the difference. On the road after listing, I also hope to have more flowers and less traps.