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After streams of negative publicity and protests from drivers, on April 17, Yidao Yongche’s (易到用车) CEO publicly admitted they were in the midst of a cash crunch. Given recent restrictions around the country on drivers, past subsidy wars, and a market share of a mere 3.6% (Didi’s is 94.6%), this should not come as a surprise. What was surprising was how he explained it: He claimed that LeEco, the company’s controlling shareholder, diverted an RMB 1.3 billion fund originally earmarked for the company so they could service their own debts. While LeEco and other representatives of Yidao have denied the veracity of the claim, the founding members, including the CEO, have publicly resigned.

This yet another nail in the coffin for LeEco. Not only have they delayed payment to US employees, but TechNode has also heard from Chinese employees that their pay has been delayed as well. And the list goes on:

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John Artman

John Artman is the Editor in Chief for TechNode, the leading English information source for news and insight into China’s tech and startups, and co-host of the China Tech Talk podcast, a regular discussion...