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A list of the eight cold events in China's auto industry in 2018
Jan 03, 2019

In a twinkling of an eye, 2019 has arrived. Looking back on the past 2018, the size of the Chinese auto market has continued.Which events make you remember? What are the sudden events that make you unexpected? Through the comprehensive consideration of the suddenness of news events, the intensity of communication, and the degree of influence on the industry, I have rated the eight "cold" events in China's auto industry in 2018 and share them with you.

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01 Great Wall Geely "black public relations" dispute

On the evening of October 18, Great Wall Motor official Weibo issued a statement stating that it was attacked by a brand (Geely Automobile) "black public relations".The statement pointed out that some companies have smeared Great Wall Motors and its products by organizing a large number of articles and comments. There are obvious signs of "black public relations" with organized, premeditated and targeted goals.Then on the evening of October 22, the head of the Great Wall Motor Media Public Relations Department told the media that the company had reported the case to the police and reported it to the local network management department to apply for investigation and deal with the "black public relations" behavior.

 

The other party involved in this incident, Geely Automobile, also responded to the incident very quickly, saying that the "Jili’s Employed Water Army" and other related news disseminated on the Internet "cannot be faked again, and the rumors must be severely punished by law". It means that the company will resort to legal means and pursue the legal responsibility of the rumors.On October 29, the police briefing issued by the Binjiang Branch of the Hangzhou Public Security Bureau showed that Ningmou, a screenshot of Geely’s hired water army WeChat, had been captured.Then around November 7th, according to the Haidian Court Network news, Geely Automobile has officially sued Great Wall Motor for commercial smashing, demanding that it stop the infringement and apologize.In this regard, Great Wall Motor did not respond.

It seems that Geely and the Great Wall seem to be "going to the court", but unexpectedly, Geely and the Great Wall not only did not continue to "noisy", but instead shook hands.On November 15, Wang Fengying, president of Great Wall Motors, met with Geely Automobile President An Conghui and issued a joint statement, saying that the misunderstanding of the "black public relations" incident has been eliminated. The two sides reached a consensus and will seek cooperation and work together!

The misunderstanding of Geely and the Great Wall was eliminated, and the "black public relations" incident that had been raging was finally a result.However, it is worth noting that there are indeed more or less malicious smears and attacks between brands in the automotive industry, which should cause concern and reflection in the entire automotive industry. After all, the mutual suppression of brands is not conducive to the growth and development of automobile companies. Only by unity and cooperation can we better enhance ourselves and the competitiveness of the entire Chinese automobile industry.


02 BYD is deeply immersed in the "Advertising Gate"

On July 12, BYD issued a statement on the official Weibo, saying that a person named Li Juan recently cooperated with a number of advertising media companies in the name of BYD in the form of forging official seals.BYD did not know about this and had already called the police.On the evening of the same day, Shanghai Jingzhi Advertising Co., Ltd., which served BYD, published an article stating that the contract fraud identified in the BYD statement lasted for three years, involving at least 25 advertising providers, with a cumulative amount of 1.1 billion yuan.It also cited a number of evidences that BYD could not be unaware of the marketing activities carried out by Li Juan.

 

As the incident continued to ferment, the parties involved issued clarification statements or produced various types of evidence to make the incident more confusing.On July 16, BYD issued an announcement re-emphasizing that Li Juan and others are not BYD employees or former employees.On the same day, BYD also stated in its official Weibo notification letter that it is willing to maintain active communication with related companies and will discuss reasonable solutions with relevant companies based on the police's verification of relevant facts and amounts.As for how the incident was finally resolved, whether the relevant parties have received satisfactory feedback, there is no further information.

At this point, the entanglement in the incident itself has little meaning, and some of the "hidden rules" of the automotive industry that have been exposed during this period, such as bidding and malicious competition, should be paid more attention.Some commentators said that BYD’s “Advertising Gate” incident was only the beginning, but it opened a door for people to know the corruption of the auto industry.If this is the case, then the automotive industry really needs to be reorganized.


03 Evergrande ff from cooperation to "mutual tearing"

On June 25, Evergrande Health announced that it acquired 100% of Hong Kong Shiying Company for HK$6.746 billion, thereby indirectly obtaining a 45% stake in Smart King and becoming the company's largest shareholder.Smart King, on the other hand, holds 100% of the new energy car companies Faraday Future (USA) and Faraday Future (Hong Kong) invested by Jia Yueting.

In the case of Evergrande Health, this indirect ff is expected to enable it to gain strong competitiveness in the fast-growing new energy vehicle industry, occupy market share and diversify its business.For ff, which has always been worried about funds, Evergrande Health has undoubtedly brought "saving money" to it, which is a good thing for mutual benefit and win-win.

However, in just over three months, the cooperation between the two sides has suddenly changed.On October 7, Evergrande Health announced that ff founder Jia Yueting had basically used up Evergrande's 800 million US dollars, and proposed to pay 700 million US dollars in advance. After reaching the goal, he proposed arbitration and demanded to deprive Evergrande of financing approval. And lift all cooperation agreements.


On October 8, ff also issued a statement saying that the only reason for "ff to lift all agreements" was that Evergrande refused to pay the funds it had agreed to pay.It is said that ff and Jia Yueting have completed all the payment terms required by the three-party agreement signed by the investor in July. In addition to the first investment of 800 million US dollars, Evergrande failed to fulfill the promise of paying any additional funds to ff. Instead, try to gain control and ownership of all ips of ff China and ff.During this period, Evergrande also prevented ff from accepting any direct financing from other sources.

On the evening of November 29, Evergrande Health announced that the Hong Kong International Arbitration Center completely rejected Jia Yueting’s request for deprivation of Evergrande’s asset mortgage.As the losing party, Jia Yueting was responsible for the litigation and arbitration fees of himself and Evergrande, totaling approximately HK$8.3 million.According to the official statement issued by ff, the ff claim referred to in the Evergrande Health Bulletin was not completely rejected, but the results of the ruling were interpreted unilaterally by out of context.

In short, the two sides hold each other's words, and the truth is difficult to distinguish.However, no matter what is wrong or not, it is a heavy blow to ff, which is questioned by itself.After all, for Evergrande, without ff, it is still possible to find opportunities to enter the auto industry. After the escalation of contradictions with Evergrande, ff will once again face huge financial pressure, and ff91 mass production is also more uncertain.In fact, on December 5th, ff issued a statement stating that it is currently facing a serious cash flow crisis and will soon file an application for emergency relief procedures in the main arbitral tribunal.


04 Mustang Motors sued Ford Mustang for winning

In January 2016, Mustang Motor filed a lawsuit against the Chengdu Intermediate People's Court for alleged trademark infringement, because Ford Motor (China) Co., Ltd. (hereinafter referred to as "Ford China") has the Chinese name of its sports car Mustang and its brand name, and demanded compensation. Economic losses.Finally, in early 2018, the Chengdu Intermediate People's Court ruled that Ford China stopped infringing the exclusive trademark rights of Mustang Motor Company and compensated the corresponding economic losses of Mustang Motors.According to this judgment, the mustang model will no longer be able to publicize with the "Wild Horse".On the home page of Ford China official website, Ford China has issued a statement on the trademark issue of "Wild Horse" and apologized to Mustang Motor, saying that it has brought adverse effects to Mustang.

 

Mustang and Ford were originally car brands that could not be beaten by the gossip. In the words of the industry, "the two are not at the same level", so when the news of the Mustang car fell over the Ford Mustang, it caused a buzz. one slice.However, I have to say that the Mustang car is still very commendable.The automobile trademark is a specific symbol of the automobile as a commodity, and it is also the main symbol for people to identify different automobiles. It is also an inestimable intangible asset of the enterprise.When trademark infringement occurs, companies should take legal weapons and defend their trademark rights.The case of the Mustang Auto also proves that regardless of the size of the company/brand in front of the law.


05 Suzuki Motor completely withdraws from the Chinese market

On June 15, Beiqi Changhe official website announced that Suzuki Motor will officially withdraw from Jiangxi Changhe Suzuki Automobile Co., Ltd. (hereinafter referred to as “Changhe Suzuki”) and obtain approval from the competent authorities. It was approved on May 30, 2018. The registration procedure for the change of the shareholding and company name was completed on the day.

After the incident was exposed, the industry focused on Suzuki's other joint venture car company in China, Changan Suzuki.It stands to reason that for China, the world's largest auto market, Suzuki will not give up easily. That is to say, although Changhe Suzuki has withdrawn from the historical stage, Changan Suzuki will not disintegrate temporarily.At that time, Changan Automobile also issued a statement denying that it planned to acquire the equity of Changan Suzuki held by Suzuki, which is not true news.

 

However, after just over two months, things have changed unexpectedly.On September 4, Changan Automobile announced that it had reached an agreement with Suzuki and Suzuki China to acquire 40% and 10% equity of Changan Suzuki held by Suzuki and Suzuki in China for 1 yuan.After the completion of the acquisition, Changan Automobile holds 100% equity of Changan Suzuki.This means that Suzuki Motor has completely withdrawn from the Chinese market.


Exiting the Chinese market is not so much an initiative as Suzuki's initiative, but it is helpless, because both Changhe Suzuki and Changan Suzuki have gradually declined in recent years.Changhe Suzuki is almost stagnant in the launch of new products, and the market performance is not optimistic. The resulting sales decline and loss of performance make it less interested in the Chinese market. Changan Suzuki also has insufficient brand competitiveness and new investment. Insufficient strength, slow replacement and other issues, sales continued to decline, and losses continued to increase.Perhaps for Changhe Automobile and now Changan Suzuki, the departure of Suzuki may not be a good thing, but it is obviously not easy to get rid of the current "difficulties".The road ahead is long and still needs to be searched.


06 Chery equity transfer "flow"

On May 29th, it was reported that Chery held the second ninth employee representative assembly. The meeting passed the resolution on the transfer of Chery Automobile's equity by secret ballot. Chery intends to introduce the cash injection method of not less than 20 billion yuan. Foreign investors, in the form of capital increase and shareholding, entered Chery Automobile.On September 17, Chery's capital increase and share expansion plan was first linked to the Changjiang Equity Exchange, and no prospective investors were collected during the pre-disclosure period.

On September 25, the Changjiang Equity Exchange updated the plan for the capital increase and share expansion of Chery Automobile and Chery Holdings. The new round of registration deadline is November 22, but the deadline has not been collected by prospective investors.According to the announcement, from the deadline of the announcement on November 22, the announcement will be extended according to 5 working days, and the extension will be extended by up to four cycles. That is to say, the final closing date of this announcement is December 20, however, At present, the extension period of the announcement has ended, and the status of Chery's capital increase and share expansion still shows “unsuccessful”, which means that Chery’s three-month “mixed change” project has been “flushed”.

 

Under the pressure of falling sales, increased capital pressure, and declining brand influence, Chery’s choice to introduce strategic investors to “transfusion” is indeed reasonable.Yin Tongyue also said in a letter to all employees of Chery that in order to realize the Chery Group's 2025 strategy, it requires huge capital investment and needs to introduce strategic capital. This capital increase and share expansion can realize Chery's dream and strategy. And the mission gathers superior resources and injects fresh “blood”.However, from the current situation, the situation is obviously not optimistic. Then Chery wants to get rid of the dilemma, I am afraid I have to think about other methods.


07 Geely becomes Daimler's largest shareholder

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In November last year, Geely was rushed to acquire a 5% stake in Daimler, and the two scandals continued.Although Daimler categorically rejected the request of Geely to hold shares, he expressed his welcome to the stock market in the open market.In a few months, Geely bought 9.69% of Daimler shares through an investment fund.After the completion of the acquisition, Geely will become the largest shareholder of Daimler Group.

However, after the disclosure of this matter, the German Federal Financial Supervisory Authority believed that Geely was suspected of acquiring Daimler shares and said it would consider fines.Until recently, according to foreign media reports, the German Federal Financial Supervisory Authority (Bafin) has concluded the investigation of "Geely's acquisition of 9.69% of Daimler" and decided not to impose any fine on Geely.In other words, Geely has become the first major shareholder of Daimler.

 

From the perspective of Geely, its investment in Daimler as the largest shareholder has two purposes: first, to cooperate with Daimler, and second, purely for the purpose of obtaining investment dividends.It is not difficult to see from Geely’s “not seeking a seat in the board of supervisors in Daimler” and “whether the two sides will have more cooperation will depend on the Daimler side.” It seems that it is not possible to cooperate with Daimler. Its preconditions for the acquisition of Daimler shares.

However, Geely and Daimler also have the possibility of cooperation, and Geely's current rapid development, if it can cooperate with Daimler, is undoubtedly "adding wings."In fact, around October, Geely and Daimler set up a high-end travel joint venture, each holding 50% of each share. As for whether the cooperation between the two parties will go further, it remains to be seen.


08 Wuliangye acquires Kaiyi Automobile or cross-border vehicle

On January 2, Chery Automobile announced that the 51% equity transfer price of Kaiyi Automobile was 2.494 billion yuan. After the completion of the transfer, Chery Automobile holds a 49% stake in Kaiyi Automobile, Yibin Automobile Industry Development Investment Co., Ltd. Holding a 50.5% stake, Sichuan Yibin Push Group Co., Ltd. (a subsidiary of Wuliangye Group) holds 0.5% of the shares.Although Wuliangye has a small shareholding, considering its previous cooperation with Yibin Automobile Industry Development Investment Co., Ltd. and its own series of actions to enter the automobile industry in recent years, the outside world has speculated that it will borrow This official cross-border car. 

 

It is understood that Wuliangye had a great interest in the automotive industry as early as 2002 and 2003.In 2006, Wuliangye won 50% of Xinchen Power's shares and entered the field of automobile engines. In 2009, the Push Group and the Brilliance Jinbei jointly established the Brilliance Jinbei Mianyang Branch.However, at the time when the industry wanted to officially “build a car”, Wuliangye suddenly lost its movement.In 2011, Wuliangye Group transferred the equity of Xinchen Power Co., Ltd. and temporarily withdrew from the automobile industry.Although I don't know what is the reason for this, I have no regrets about Wuliangye.For this reason, when its subsidiary acquired the equity of Kaiyi Motor, the speculation that Wuliangye started the car-making plan again is inevitable.

But guessing is ultimately a guess.After this incident was exposed, Wuliangye executives said that the group did not have a car-making plan. The cooperation with Chery was the Pushi Group of Wuliangye Group Co., Ltd., which supplied parts and components for the automobile manufacturing enterprises for a long time.This time, Yibin City introduced Kaiyi Automobile, which is a local component supplier.According to the Securities Times, on June 8 this year, at the 2017 Annual General Meeting of Wuliangye, Li Shuguang, chairman of Wuliangye Group and director of the company, also made it clear that Wuliangye had no plans to build a car and joked that it was “drinking”.From this point of view, Wuliangye made a car, perhaps it is really we think more.

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From: Geshi Automobile