The courtroom in Shenzhen has finally witnessed the symbolic end of an era. Xu Jiayin, the former village boy who rose to become China’s wealthiest man, stood with a lowered head to deliver a formal plea of guilt. This admission marks a somber milestone in the collapse of China Evergrande Group, leaving behind a staggering 2.4 trillion yuan debt hole that continues to haunt the national economy.
At its peak in 2017, Evergrande was the crown jewel of China’s debt-fueled property boom, and Xu was its undisputed king with a personal fortune of 2900 billion yuan. However, the aggressive 'three high' model—high leverage, high turnover, and high debt—eventually hit a wall as Beijing tightened the screws on the sector. By 2021, the liquidity crisis became an uncontrollable fire, engulfing thousands of suppliers, investors, and homeowners.
The human cost of this collapse is difficult to overstate, with the debt equivalent to roughly 1,700 yuan for every person in China. While Xu now faces the likelihood of life imprisonment or worse, the legal resolution does little to fill the financial crater he created. The 2025 forced delisting of the company from the Hong Kong Stock Exchange signaled the definitive death of a corporate titan that once moved global markets.
Perhaps the most egregious example of Xu’s hubris was Evergrande Auto, a venture meant to challenge Tesla through a strategy Xu summarized as 'buy, merge, and expand.' Despite burning through more than 140 billion yuan in capital over five years, the division delivered a meager 1,429 vehicles. This equates to a staggering loss of approximately 100 million yuan for every single car produced, turning the venture into a literal money incinerator.
Today, the manufacturing bases that were supposed to revolutionize the industry lie in various states of insolvency. The Tianjin plant sits with a bank balance of less than 130,000 yuan against billions in liabilities, while the Shanghai division has entered formal liquidation. Only the Guangzhou plant has found a potential lifeline through a state-backed takeover by Guangzhou Juli, reflecting the government's selective intervention strategy.
Xu Jiayin’s downfall serves as a grim cautionary tale for the global financial community and the Chinese private sector alike. It signals the end of the 'growth at all costs' mantra that defined Chinese urban development for three decades. As the dust settles, the focus shifts from the fate of one man to the long-term stabilization of a property sector that remains too big to fail but too broken to easily fix.