Successful reorganization of the new Changan Zhiyuan Gaoyuan
On November 10th, China Ordnance Equipment Corporation and China Aviation Industry Corporation officially announced the reorganization of China Chang'an Automobile Group Co., Ltd. in Beijing. According to the reorganization plan, AVIC Industries will use the shares of Changhe Auto, Hafei Motors, Dongan Power, Changhe Suzuki, and Dongan Mitsubishi as its holdings, and the China Changan Automobile Group under the China Armed Forces Group; The equity of the company was allocated to AVIC. The two groups reorganized the establishment of the new China Changan Automobile Group Co., Ltd., with the Corps Holding Group holding 77% and AVIC Holding 23%. As a well-known military industry group in China, both the Armed Forces Group and AVIC were selected as Fortune 500 companies this year. The two major military groups reorganized the China Changan Automobile Group. This is the first large-scale, cross-border, national defense technology industry in the field of civil products. Departmental and in-depth cooperation is also the largest strategic reorganization ever undertaken between central enterprises in the automotive sector. It will surely have a profound and long-term impact on the optimization of industrial layout and promotion of structural adjustment in the Chinese auto industry.
According to reports, in the next three years, the new China Chang'an Automobile Group will fully assemble, integrate, and expand the auto industry resources of both parties, taking energy conservation and environmental protection and new energy vehicles as breakthroughs to further enhance the ability for independent innovation and provide consumers with more energy-saving and environmental protection. Safe and stylish, affordable classic product. At the same time, we implemented deep specialized management, carried out extensive capitalization operations, implemented industrial chain operations, and vigorously promoted joint ventures and cooperation in accordance with the concept of “complementary advantages and cooperation and win-winâ€. By 2012, the total vehicle sales will exceed 2.6 million units, which will initially have the ability to participate in the international mainstream automotive market competition. By 2020, a relatively complete product line will be formed, and independent brands will enter the high-end market, and the total vehicle sales will reach 5 million.
Old foundation promoters challenge the "throne"
For the successful reorganization of New Chang’an, people familiar with the automotive industry will almost immediately recall the company’s strong manufacturing capabilities in microcars. A closer look at the structure of New Chang’an will reveal that the impact may be far more than that of traditional minicars. It may have a new driving role for the entire domestic automobile manufacturing industry, at least for the domestic auto market to have a strong newcomer to compete for the leading position.
According to the sales statistics for January-October of this year, sales of Xin Changan’s core Chang’an Auto Group ranked fourth after the east wind, and after sales of Hafei and Changhe’s automobiles sold, sales of the new Chang’an can surpass the east wind at least in quantity. Ranked No. 3. In terms of mini-vehicle manufacturing, Changan Microcars has already followed the second position with SAIC-GM-Wuling. After the mini-vehicle sales of Hafei and Changhe, it will reach 810,000 units with SAIC-GM-Wuling’s sales of 810,000 units. Although the profitability and sales of mini-vehicles cannot be compared with that of sedans, it has nine major vehicle production bases such as Chongqing, Heilongjiang, Jiangxi, Jiangsu, Hebei, Anhui, Shanxi, Guangdong, and Shandong, all located in the north and south of the country. The entire automobile factory and 27 directly-affiliated enterprises have an annual production capacity of 2.2 million units (sets) of vehicles and engines, and have established large-scale enterprises with overseas bases in countries such as Malaysia, Vietnam, Iran, and Ukraine. The manufacturing capability of New Chang’an is apparent. Allow domestic competitors to ignore. In fact, from the point of view of manufacturing and selling mini-vehicles, if New Chang’an can fully coordinate with raw materials procurement, product deployment and transportation, and even its major technology provider, Suzuki Japan, it can obtain more reasonable results than the existing structure. Huge profit. This is one of the main reasons why the industry is optimistic about this merger.
Dongan Power boosts Chang'an
After further analysis, the production and sales of automotive engine kits and transmissions that originally belonged to Dongan Power and Dongan Mitsubishi were reasons why many people in the industry paid special attention to them – although the “core making exercise†of domestic self-owned brands has been in full swing for many years. However, with Brilliance and BYD as the representatives, no less than 40% of self-owned brand cars must rely on the power system provided by Dongan, and some people even joked that "controlling Dongan Power is equivalent to holding back the throat of half of domestic self-owned brands." To a certain extent, the rapid expansion of domestic auto brands in these years also allows Xin Changan to easily gain profits while also being able to quickly get involved in the auto market of its own brand, and even be able to make its own autonomy within 10 years. Brand cars enter the high-end market and realize the strategic concept of its establishment.
Of course, as many industry peers have pointed out, the current reorganization does make the most powerful Changan have a crucial decision-making power. However, the more difficult task is how to coordinate the weaknesses of the merger in the future. Remodeling work - in short, "How to be stronger after being big." Compared with the previous mergers of Tianyi, Shangnan, and Guangqi Changfeng, the reorganization of the new Chang’an now needs to be much more complex. How to quickly and effectively coordinate the resources and interests of all parties, including how to integrate with Ford, Suzuki, and Mitsubishi These overseas partners negotiate and will test the wisdom of the new Chang’an managers.
View related topics: Military Equipment Group and AVIC Restructuring - Changan M&A Changhe Hafei