Company: CENN
Filing Date: 2025-04-01
Form Type: 10-K
Source: 0001140361-25-011607
Chunk: 21

Company: Cenntro Inc.
Filing Date: 2025-04-01
Form: 10-K
Item: Item 1
Chunk 21
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 wholly owned local Electric Vehicle Centers (“EV Centers”), local dealer networks, parts
          fulfillment centers, and local service providers. We continuously develop, expand, and improve our distribution and service infrastructure. We believe that having a good and capable distribution and service infrastructure is essential for our
          business. We have invested many resources to build this distribution and service infrastructure. We believe a wholly owned distribution and service infrastructure is important to an automobile manufacturer like us. To that end, we have decided to
          build our own distribution and service infrastructure after we secured sufficient capital to do so.

We distribute and sell our products directly by our corporate sales department or by our local EV Centers. We also distribute and sell our products through our local dealer
          networks in Europe and in the United States, which are developed by our local EV Centers.

We provide our services through our local EV centers, our local dealers, or our local service providers. To support our local service providers or dealers, our local EV centers
          provide training and support to our local dealers and local service providers.

To improve efficiency in distribution, sales, and services, we have begun introducing local distribution channels alongside our existing EV Centers. As these new distribution channels are gradually
          replacing our local EV Centers, we are considering closing some EV Center locations. This shift toward distribution channels will improve service quality, enhance cash flow, reduce inventory burden, and significantly lower our operational costs.

          13

Our Parts Distribution System (“PARDISYS”)

We have invested resources into our cloud-based parts distribution system because we believe an effective and efficient parts distribution system is important for vehicle
          after-market support and customer satisfaction. Through our cloud-based parts distribution system we globally provide and timely deliver spare-parts to our service providers and customers. The cloud-based system also keeps our parts inventory
          leaner and more responsive to better manage our working capital more efficiently.

In order to satisfy that goal, we established two production-side parts warehouses in Changxing, China and Yangzhong, China which store our produced parts that can be locally
          sourced on a global scale. Our warehouses can send the parts globally in response to orders from our website that customers can place. Based on the local demand data, our cloud-based parts distribution system will make determinations on when to
          send certain parts from production-site warehouses to remote warehouses for quicker local delivery. As of December 31, 2024, we have established two spare-parts fulfillment warehouses in Barcelona, Spain, and Freehold, New Jersey.

Sales