• Microvast Holdings, Inc. (MVST) is a battery company that portrays hundreds of millions in revenue and exciting new clients to investors. We believe the company is fabricating a significant part of its business and capabilities.
• We conducted extensive on-the-ground due diligence on MVST’s main production facilities and cross-checked that data with satellite images. We literally counted for weeks the trucks going in and out, employees coming and leaving, cars in the parking lot, etc.
• We observed MVST’s Ludwigsfelde/Berlin plant extensively since its supposed production start in March 2021, where up to 250 people should be working to service MVST’s growing European market. After 41 random observations during business hours, we saw only two semi-trucks docked; for 39 out of the 41 visits, all 5 docks and 10 semi-truck lots were unused. The employee parking lot was filled with less than 30 cars on average and never exceeded 50 cars.
• MVST’s largest production facility is in China where over 2,500 employees are supposedly working, according to the company’s disclosure. Our site observations, along with Chinese Local Government documents indicate that the facility in fact only employs a shrinking group of approximately 1,400 people.
• MVST failed all of its U.S. business initiatives and lost dozens of millions of shareholders’ money in the process. Management has not been able to get a US based production facility off the ground.
• Given the devastatingly low activity levels over an extended period of time that cannot align with the financials MVST presents to investors, we must conclude that MVST’s reported financial statements cannot be relied upon.
• We looked deeper into MVST’s announced clients and partnerships and found that the vast majority (>95%) of MVST’s commercial counterparts outside of China, sometimes described as major wins or breakthrough partnerships, are tiny startups or prototype partnerships showing insignificant economic opportunities.
• MVST had been denied a $200 million grant for the construction of its U.S. facility due to its suspected ties with the Chinese government in the company. MVST’s management has explicitly and vehemently denied any involvement by the CCP. We found the paper trail that unrefutably proves that the Chinese government is in fact a shareholder in MVST’s main Chinese subsidiary.
• Our investigation has uncovered numerous, well-documented, and substantial falsehoods, which have been signed off by the same auditor we have seen in past frauds like “Gaotu Techedu Inc.” (GOTU, previous ticker: GSX).