Top ten "upset" events in the auto market in the first half of 2020

The year 2020 has passed halfway. Looking back over the past six months, the domestic auto market can be described as continuous major events. New car companies have seen various situations frequently. Foreign car companies have become a major shareholder of an independent car company through equity acquisitions for the first time. The long-term underperformance joint ventures have also set off a round of mergers and reorganizations, coupled with the impact of the pneumonia epidemic Some car companies "do not do business properly" to open up new businesses, etc. In the first half of 2020, many unexpected things have happened in the domestic auto market.

TOP1, Sailin was blocked

The “Bird’s Nest Night” conference in 2019 is a highlight moment for Sailin Motors. Of course, the focus of everyone’s attention will be somewhat different from the original intention of Sailing Motors for this conference. What the general public sees is the grand occasion of international superstars and domestic popular traffic niches on the same stage, leaving behind the image of Sai Lin Motors with "rich wealth". The automotive industry is concerned about such a grand press conference, but it is an A00-class electric car. Especially when it is associated with the supercar gene that Sailin Motor has been promoting before, it feels a little "fooled".

After the "Night of the Bird's Nest" press conference, Serin Auto has been having problems. Take turns to "fight" with media, marketing companies and even your own employees. In the past six months, there have been more and more negative news surrounding Sailin Motors. At present, Sailin Motors has been seized by the court, and Chairman Wang Xiaolin has long escaped abroad. The latest news is that Wang Xiaolin has been formally put on file for a crime. The state-owned major shareholders are not only likely to "fight the water" with their billions of investment, but also bear the "bad reputation" of an irresponsible company. Many grassroots employees of Serin Motor whose wages are in arrears are still defending their rights. However, judging from the current situation, it is still unknown whether the "salary" can be successful.

TOP2, Bo County is all on standby

"Today, without external capital injection and government support, it is impossible to restore the normal operation and development of the company in the short term by relying solely on my own strength." Huang Ximing, founder and CEO of Bojun Automobile, sent to the employees of the company. The internal letter confessed the crisis facing the company. Earlier (June 15), Bojun Automobile has issued an official announcement, announcing that all employees are on standby.

Image source: Bojun Automobile's official website

The current industry environment is that local governments and investors have been "lied" to fear, and investment in new car companies will definitely become more and more cautious. In other words, Borjun Automobile, which has long been broken in the capital chain, is no longer available. External support, waiting for the future of this company, is likely to be bankruptcy liquidation.

However, although the situation is similar, they are no longer able to continue, but compared with Wang Xiaolin, chairman of Sailin Motors, who "hide" abroad under the pretext of "not buying a ticket", Huang Ximing at least made a promise that no matter how difficult the situation is, he Will stay in China and go all out to protect the legitimate interests of employees. According to Huang Ximing’s statement in the open letter, his main job in China at present is to recover funds through the sale of intangible assets (models, platforms and intellectual property built in three years), in order to give priority to solving employees’ social security, provident fund and salary issues. .

TOP3, Byton suspends China business

On June 29, Byton Motors CE0 Dai Lei announced at the temporarily organized telephone communication meeting for all employees in China that it would suspend business in China for the next six months from July 1. Except for retaining a small number of employees on duty to maintain the company's basic operations during the period, all other employees in China will be on standby.

In the recent wave of "closures" of new car forces in the domestic auto market, Byton should be the most regrettable one. According to the original plan, Byton will launch the M-Byte SUV in China at the end of 2020. Various signs also indicate that the M-Byte is now ready for mass production. The actual car that is close to mass production has been officially unveiled at the CES show in early 2020. It has also been invited for small-scale test drives before, but because the capital chain is broken, it can only be suspended at present.

Byton M-Byte, picture source: Byton Motors official website

Earlier, a Byton employee told Gasgoo that, for Byton, the factory and production qualifications are already available, and the trial production has been completed. The next step is to mass production. But for Byton Motor to achieve mass production, there will be a funding gap of about US$500 million. The employee said that he originally received about 100 million U.S. dollars in investment from Japan's Marubeni and South Korea's sk during the C+ round of financing, but after paying a deposit of several million yuan, he ran into the epidemic, and the follow-up payment never came in. There were some concerns at the government level (it is rumored that after a government investment was received at the end of March, Dai Lei transferred the money to the United States in order to pay the salaries of American employees. Therefore, domestic employees who were owed wages reported Dai Lei to relevant departments. ) Also stopped continuing to invest. In addition, the rumored investors such as FAW, Baoneng, etc. have not really made a deal for various reasons, and Byton, which is short of money, can only temporarily go out of business.

TOP4, Weilai "move the capital"

After several twists and turns, Weilai Automobile finally determined the location of its Chinese headquarters. In April 2020, Weilai Automobile officially settled Weilai's China headquarters in Hefei, Anhui. In exchange, it was an investment package of Anhui state-owned assets, including a strategic investment of 7 billion yuan. For NIO, this investment can be called "life-saving money."

Image source: Weilai Automobile's official website

Li Bin, chairman of Weilai Automobile, is often called the worst man in 2019. Although it is a joke, it can also be seen how difficult Weilai Automobile has been before. After many years of continuous huge losses, it encountered the "cold winter" of the capital market, and the cash flow of Weilai Automobile also showed signs of breaking down. In the context of extreme lack of money, Li Bin started the road of "searching for gold" everywhere. In a year or so, Li Bin had contact with the governments of Beijing, Qingdao, Huzhou and other places, and wanted to stimulate government investment by transferring the "base camp" of NIO. After hitting the wall several times, it finally won the favor of the Anhui government and solved the urgent need. The next step is to see how Weilai Automobile will repay the Anhui government, which has always had a dream of "Da'an Automobile".

TOP5, Volkswagen takes a stake in JAC

In the Chinese auto market, there have been cases of independent auto companies acquiring overseas brands, and there have been cases of mutual shareholding between Chinese and foreign auto companies. However, like Volkswagen, it directly acquired half of a Chinese auto company and became the actual controller of the latter. The case is still relatively rare. On May 29, Volkswagen (China) Investment Co., Ltd. formally signed the "Letter of Intent for Cooperation" with relevant government agencies in Anhui Province, announcing that it would invest 1 billion euros to acquire 50% of the shares of Jianghuai Automobile's parent company-Anhui Jianghuai Automobile Group Holdings Co., Ltd. At the same time, it increased its shareholding in the Jianghuai Volkswagen joint venture to 75%. It is reported that the acquisition will be completed by the end of this year.

Image source: JAC official website

The introduction of major foreign shareholders in the mixed reform of state-owned enterprises is at least a unique precedent in the domestic automotive field. With Volkswagen’s shareholding in JAC, JAC is definitely a beneficiary. With Volkswagen’s endorsement, the value-added of JAC has become a logical thing. On a larger scale, it is not an exaggeration to say that it promotes the development of Anhui's automobile industry.

However, Volkswagen will choose to spend 1 billion euros to invest in JAC when its profitability is greatly reduced. It must have its own considerations. The importance of the Chinese market to Volkswagen is no longer necessary. It is an indisputable fact that future market competition will be mainly reflected in the competition of new energy products. Volkswagen wants to continue to maintain its leading advantage in the future domestic market and expand its new energy business. It is an inevitable topic. Before acquiring the equity of JAC, Volkswagen also invested 1.1 billion euros to become a major shareholder of Guoxuan Hi-Tech, a domestic battery manufacturer. Obviously, Volkswagen's electrification layout in the Chinese market has been fully launched. Returning to the vehicle business, Volkswagen has been in the domestic market for many years and has many Chinese partners, but compared to SAIC and FAW, JAC is obviously the one that is easier to control. Volkswagen's investment in JAC is definitely not for unilateral "blood transfusion", but for a win-win situation.

TOP6, Dongfeng Renault reorganization

After entering 2020, the successive "thunderstorms" of new car companies have caused many people to ignore another major vulnerable group in the domestic auto market-French cars. In fact, in the first half of 2020, the two major French brands Renault and Peugeot Citroen both contracted their business in China.

On April 14, Dongfeng Group’s announcement revealed that in view of the decline in the domestic auto market and Dongfeng Renault’s operating conditions, both Dongfeng and Renault intend to reorganize Dongfeng Renault. Specifically, Renault's passenger car business will withdraw from the Chinese market, and its shares in the Dongfeng Renault joint venture will be transferred to Dongfeng Motor, and Dongfeng Renault will stop its Renault brand related business in the future. The Renault brand's future strategic focus in the domestic market will shift to electric vehicles and light commercial vehicles.

Because the market performance has not been satisfactory, Renault's passenger car business has been rumored to withdraw from the Chinese market for a long time. The impact of the new crown pneumonia epidemic in the first few months of 2020 has become the last straw to overwhelm the camel. After Dongfeng Renault’s delisting, resources such as employees and factories have already been "received", and most of them have been adjusted to Dongfeng’s new high-end brand division-h brand division. The next thing that needs to be focused is the original Dongfeng Renault’s Dealers and car owners too.

TOP7, Baoneng acquired Changan PSA

Changan PSA is another French joint venture car company that has become history.

Changan PSA's foreign shareholders withdrew earlier. At the end of 2019, PSA Group had sold all of its shares in Changan PSA. However, unlike Dongfeng Renault being taken over by the Chinese shareholder Dongfeng Motor, the fate of Changan PSA is even more tortuous. The Chinese shareholder Changan Automobile has obviously regarded it as a heavy burden. Like foreign shareholders, Changan also chose to withdraw.

The acquisition of Changan PSA is the Baoneng Group, which has been quite active in the domestic auto market in recent years. At the end of 2019, Baoneng companies have basically completed the acquisition of Changan PSA’s equity. In May 2020, the Shenzhen Municipal Market Supervision Administration website information showed that Changan PSA has been changed to Baoneng Automobile Co., Ltd., which also means Baoneng The acquisition of Changan PSA is officially finalized.

Picture source: Baoneng Group official website

Baoneng Group, which has "turned the clouds and rain" in the capital market, has sufficient funds. Yao Zhenhua, the chairman of Baoneng Group, has also publicly expressed his determination to enter the automobile industry: "Strive to build Baoneng Automobile into a strong competitive and international market in 10-15 years. Influential automobile groups," but the successive acquisitions of Qoros Auto and Changan PSA (recently in contact with Byton Motors, which has suspended domestic business) are marginalized companies that have been "market-proven". It’s hard not to make people suspect that the “leakage” behavior is that Baoneng Group, which focuses on real estate, enters the auto industry is "drunk man's intention." "Enclosure" is still a car, Baoneng Automobile's true intentions have yet to be verified.

TOP8, inter-bank production of "masks" by car companies

At the beginning of February 2020, when the domestic new crown pneumonia epidemic was most severely affected, masks became the most popular commodity in the country. On February 6, SAIC-GM-Wuling announced that it would cooperate with suppliers to make masks; on February 9, the first batch of Wuling brand civilian masks rolled off the production line; on February 10, SAIC-GM-Wuling announced that it would build its own mask production line. In line with the slogan "Wuling makes whatever the people need", SAIC-GM-Wuling became the first auto company to produce masks across the industry.

Wuling mask, image source: SAIC-GM Wuling official map

BYD's reaction speed is also very fast, two days later than SAIC-GM-Wuling. On February 8, BYD officially announced the start of production of masks. Subsequently, GAC Group also took action. On February 19, GAC Group announced that it had commissioned five mask production lines and began mass production of masks.

It is hard to say whether there are marketing requirements for the inter-bank production of "masks" by car companies, but they can actively respond to the call of the country in the face of the national epidemic. The above three car companies have demonstrated their responsibilities and responsibilities.

TOP9, "Street Car" became popular

As the domestic new crown pneumonia epidemic is gradually brought under control, boosting the national economy has become a problem that the whole society needs to face together. During the two sessions this year, many representatives put forward suggestions to activate the "market stall economy", and the Central Civilization Office also issued relevant regulations. This year, road occupation operations and mobile vendors will not be included in the assessment of civilized cities. Suddenly, the “street stall economy” that was once all the rage in the 1980s and 1990s re-emerged.

Affected by the recovery of the "floor stall economy", the "floor stall car" has also become a hot word in the domestic market recently. Car companies that have sales of trucks or Wing’s van business have begun to fully promote their "market stalls". Among them, SAIC-GM-Wuling, which is extremely sensitive to "hot spots", has also specially created a new car-Wuling Wings to open a sales truck . The new car is based on the Wuling Rongguang single-row small truck. With its cost-effective advantage, Wuling Yi's opening of the sales truck has quickly become a hot spot in the "stall car" market.

Wuling's "floor car", picture source: SAIC-GM-Wuling official map

However, the last wave of the "marketing economy" has actually taught us lessons. In the 1980s and 1990s, the market sharing economy was an important way to solve the unemployment problem, but it was difficult to manage because of the "dirty, messy, and poor" situation. Characteristically, the "floor stall" soon became the target of banning. In the face of the current new round of "street stalls" fever, people who want to "go to the sea" must have a clear understanding before buying a "street stall car". At least they need to understand that encouraging stalls is not the same as losing the city. management. If this industry wants to develop in the long term, it must establish sound industry standards.

TOP10, the auto market plunges in 2020

Affected by the new crown pneumonia epidemic, the domestic auto market after the Lunar New Year in 2020 has shown a cliff-like decline. Data released by the Passenger Association shows that the wholesale sales of my country's passenger car market in February was 252,000, a sharp drop year-on-year 78.5%. Among the 85 auto companies included in the statistics of the Association, 18 of them had zero sales in February. The sales volume of the entire auto market has returned to the level of February 2006.

Facing the irresistible factor-the impact of the new crown pneumonia epidemic, the entire automobile industry has been pressed the pause button. Fortunately, the domestic epidemic prevention and control has been relatively successful, and the performance of the automobile market is gradually improving. In May, it has achieved positive year-on-year growth (5 The monthly domestic passenger car wholesale sales volume was 1.643 million units, a positive growth of 6.3% year-on-year). However, the explosive rebound that many people expected did not appear. Under the downward pressure of the economy, Chinese people have become more cautious in auto consumption, which has also led to intensified competition in the auto market. It is foreseeable that in the second half of 2020, the "replacement" of the survival of the fittest in the auto market will further intensify.