China Evergrande New Energy Vehicle Group has warned of potential asset losses, including land and equipment, as it faces demands for the repayment of 1.9 billion yuan ($261.91 million) in subsidies.

The demands were made by local administrative bodies that sent a letter last month to Evergrande Automotive Holdings, a unit of the group, requesting the termination of various investment cooperation agreements dating back to April 29, 2019.

The company expressed concerns on Tuesday that the implementation of this decision could lead to the compulsory resumption of land where its plants are located.

Furthermore, buildings and equipment at these sites could be seized to repay the subsidies and incentives provided.

In a related development, another subsidiary, Evergrande New Energy Vehicle (Tianjin) Co., received a notice demanding rectifications on three specific issues.

This subsidiary has also been ordered to cease the production and sale of new energy passenger vehicles.

The group stated it plans to submit an appeal and rectification materials to the concerned authority within the stipulated deadline, hoping to address and resolve the issues raised.