Startup company to unveil prototype cars in Miss.

Published 1:41 am Wednesday, October 7, 2009

A startup car company said it would unveil four prototype vehicles Tuesday that will be built at a $6.5 billion plant the company plans to build in the Mississippi Delta near the Tennessee line.

GreenTech Automotive hopes to break ground this year on a $6.5 billion plant in Tunica County — near Memphis, Tenn. — and eventually build 1 million cars a year, company attorney Bill Brabec told The Associated Press on Monday. Company officials say the cars will be energy efficient, but a spokeswoman declined to offer details ahead of Tuesday’s event in Tunica.

Automotive analysts wonder about the viability of the project and its ambitious goals. GreenTech has said it hopes to employ 25,000 people.

Sign up for our daily email newsletter

Get the latest news sent to your inbox

It’s not clear what, if any, incentives Mississippi or Tunica County officials have offered. Brabec has said Tunica County already has secured land and has been looking for a big industry, such as a car plant, to come to the area.

Mississippi is home to one automobile manufacturing plant, and another is planned but is on hold.

Nissan opened its plant in 2003 near the central Mississippi city of Canton. Toyota announced in early 2007 that it would open a plant near Tupelo, in northern Mississippi, by late 2009 or early 2010. Toyota’s plans have been put on hold indefinitely amid the global economic slowdown.

GreenTech was formerly known as Hybrid Kinetic Automotive Corp., but that changed after its owner, Xiaolin “Charles” Wang, split with his Chinese partner in a messy lawsuit. Plans for the car were first revealed in June when the federal lawsuit became public and offered details of the feud.

The men fought for control of the company before reaching a settlement in July. Both said they will move forward with the plans to build 1 million cars a year.

Wang’s former partner, Yung “Benjamin” Yeung, has said he will move forward with his plans to build a plant in Alabama.

In June, a federal judge unsealed the lawsuit involving Yeung and Wang.

Yeung and Wang fought over the terms of their “handshake” business deal and whether they were partners or whether Wang worked for Yeung, according to filings in U.S. District Court in northern Mississippi. Each man accused the other of dubious business practices.

Yeung, also known as Yang Rong, was celebrated in China for leading Brilliance China Automotive Ltd. to become first Chinese company to be listed on the New York Stock Exchange in 1992. However, he later fled China after Chinese authorities accused him of unspecified economic crimes. He has denied any wrongdoing.

Court filings in the case said Mississippi Gov. Haley Barbour had been involved in discussion about the plan but Barbour’s office has declined to comment, citing the need for confidentiality in proposed economic development projects.

The lawsuit was complicated, among other things, by the fact that the name of Yeung’s company, Hybrid Kinetic Automotive Holdings, closely resembled one controlled by Wang, Hybrid Kinetic Automotive Corp. More than a dozen third parties joined in the lawsuit.

Yeung’s company has said it has the right to the “hybrid kinetic” name and “to pursue the hybrid automotive project in Mississippi without any interference from Xiaolin Wang.”

The plan before Yeung and Wang split was to raise money through a visa program that provides foreign investors with a chance to get a visa by investing in the United States.