HIGHWAY HOLDINGS SIGNS MASTER AGREEMENT FOR FORMATION OF MAJORITY-OWNED ENERGY STORAGE JOINT VENTURE WITH WOWTIGER BRAND OWNER HUAHU

Highway Holdings Limited has announced a significant move into the energy storage sector by signing a master agreement to establish a joint venture with Guangdong Huahu New Energy Technology Co., Ltd. The deal, valued at approximately $3.5 million, was disclosed on August 10, 2026, following an initial letter of intent signed on July 22, 2026. Under the terms of the agreement, Highway Holdings will hold a 57% stake in the new entity, while Huahu will retain 43%. The joint venture, named Huahu International New Energy Technology Company Limited, is expected to be officially formed within 30 days and will focus on marketing and distributing Huahu's Wowtiger-branded energy storage products in various international markets.

Guangdong Huahu New Energy Technology is a Chinese manufacturer specializing in battery energy storage systems, with a growing reputation for its Wowtiger brand. The company has established a customer base primarily in Africa and Southeast Asia, and it is now looking to expand its reach into more demanding markets, particularly in Europe and the United States. Highway Holdings, headquartered in Hong Kong, brings to the partnership its extensive manufacturing capabilities, operational presence in Europe, and established international commercial relationships. This collaboration aims to leverage both companies' strengths to create a robust platform for growth in the energy storage market.

The strategic rationale behind this joint venture is multifaceted. For Highway Holdings, the partnership represents a shift towards a product-oriented business model, diversifying its operations beyond its traditional OEM business. The joint venture is expected to enhance factory utilization rates by directing Huahu's component purchases to Highway Holdings' existing manufacturing facilities. This integration could lead to increased production volumes, improved revenue streams, and a strengthened earnings profile for Highway Holdings. Additionally, the venture will explore semi-knocked-down kit (SKD) manufacturing opportunities, further expanding its operational capabilities.

The energy storage sector is experiencing rapid growth, driven by increasing demand for renewable energy solutions and advancements in battery technology. The joint venture will initially target markets in Germany, Italy, the United States, and designated South American countries, where the need for reliable energy storage solutions is becoming increasingly critical. Highway Holdings plans to utilize its established European contacts to support Huahu's entry into these markets, enhancing customer service, warranty support, and technical project management.

In conclusion, the formation of Huahu International New Energy Technology Company Limited marks a significant step for Highway Holdings as it enters the burgeoning energy storage market. This joint venture not only positions Highway Holdings to capitalize on the growing demand for energy storage solutions but also strengthens its core manufacturing operations. As the energy storage landscape continues to evolve, the collaboration between Highway Holdings and Huahu is poised to create new opportunities for growth and innovation in the sector, potentially influencing market dynamics and competitive positioning in the years to come.