The sales of Beijing Hyundai dropped sharply, and once again, the "Red A" suffered a drop in the sales volume, and the net profit in the first three quarters was almost at a low level. The annoyance that took place in Beijing's autos is more than that.
Recently, Li Feng, president of the Beijiang Group Party Standing Committee and Dean of the New Technology Research Institute, was found to have left the company and the group's top officials set off a "personnel earthquake." An informed person close to the Beijing Automotive Group told the reporter of the newspaper of the Yangtze River Business News that Li Feng's departure was indeed the case. “But whether or not to go to Weilai, what position is still unclear.†Many market participants judge that the Beijing Automotive Group personnel adjustment, and its Decline in self-owned brand performance.
The statistics compiled by the Changjiang Business Daily reporter found that in the past three and a half years, Beijing’s Hyundai’s own brand had a loss of 11.2 billion yuan. Beijing Automobile said that due to the intensified industry competition in the first half of 2017 and the overall downturn in the Korean car market, the sales of Beijing brands and Beijing Hyundai declined, resulting in a decline in performance, which resulted in a drop in the Group's profit.
At the same time, Xu Heyi, chairman of BAIC Group, promised to stop production and sales of self-owned traditional fuel passenger vehicles in China by 2025. However, the reality is that its own brand has 2.3 million units of production capacity, and it is expected that there will be only 220,000 units sold, less than 10%.
Xiao Yue, an industry insider who has long been engaged in automotive research, told the reporter of Changjiang Business Daily that the independent brands have entered the “elimination roundâ€. If Beiqi blindly expands production capacity, it will cause a fatal blow to the continued operation of the company.
President resigns or relates to job transfer
Less than two months later, three high-level Beijing Automotive Group employees left the post and set off a "personnel earthquake."
On December 12th, Li Feng, the standing member of the Party Committee of Beiqi Group and the president of the New Technology Research Institute, was found to be retiring and he will soon join Weilai Capital as a partner.
An informed person close to the Beijing Automotive Group told the reporter of the newspaper of the Yangtze River Business News that Li Feng had indeed left this post. “But whether or not to come to Weilai, what position is still unclear.â€
Judging from past experience, Li Feng is undoubtedly a member of the Beiqi Group. Li Feng joined Beiqi Foton in 1996 and gradually rose from the director of the technical center to deputy general manager. Subsequently, he briefly served in the Chery Sales Company and joined Beijing Hyundai in 2009 as Deputy Managing Director.
In July 2013, Li Feng was promoted to president of Beijing Automotive Co., Ltd. In February 2017, Li Feng served as Party Secretary and Dean of the Beiqi Group New Technology Research Institute. He assisted Xu Heyi, Chairman of the Group, in charge of Beijing Automotive Stock Co., Ltd. and no longer serves as President of Beijing Automotive.
In fact, as early as May 2016, the "Beiqi President Li Feng resigned from office" has spread in the industry. In this regard, Li Feng has openly criticized and expressed that "I hope to be able to retired at BAIC."
However, Li Feng’s wishes did not finally come true. The person familiar with the matter stated that, as far as the president of the company is concerned, the secretary of the party committee of the Institute of New Technology and the president of the Institute of Technology are just "virtual duties." "The departure of Li Feng has nothing to do with the relationship between positions, or he is unwilling to accept a situation where the position falls."
For joining Weilai Capital, this person believes that Li Feng's entry into the start-up car company may well be a good thing, and may give him more room for development.
There are also people in the industry who believe that Li Feng's entry into the company as a partner is a transitional arrangement. In the future, he may enter Weilai Auto as CEO, or go to other Internet car companies as CEO.
Li Feng's resignation was expected in advance, but the other one's departure suddenly occurred.
On the evening of November 2nd, Foton Motor, a listed company of BAIC Group, issued an announcement that the company’s board of directors received a written resignation report submitted by the company’s director and general manager Wang Jinyu. Wang Jinyu needed hospitalization for illness and applied to resign as a director of Beiqi Foton Motor Co., Ltd. General manager duties, the company board of directors agreed to vote.
On the second day of Wang Jinyu’s resignation due to illness, Foton Motor announced again that the Foton Motors’s board of directors had received a letter of recommendation from Beijing Automobile Group Co., Ltd. Due to job requirements, Xu Heyi was no longer serving as a director of Beiqi Foton Motor Co., Ltd. Chairman of the board of directors, recommended Zhang Xiyong to serve as chairman of Beiqi Foton Motor Co., Ltd.
On December 22, Xiao Yue, a person in the industry who has long been engaged in automotive research, told the reporter of the Changjiang Business Daily that the personnel adjustment of car companies is not unreasonable, but under special circumstances, people can not help but imagine.
The sales of four independent brands declined
“A series of personnel adjustments are related to the decline in the self-owned brand performance of BAIC Group.†A number of market participants analyzed the report of the Changjiang Business Daily.
Beijing Automotive released its third-quarter financial report showing that the company's total operating income for the first three quarters was 104.066 billion yuan, a year-on-year increase of 23.63%. However, its net profit attributable to the parent company was only 1.969 billion yuan, a decrease of 49.82% year-on-year.
It is worth noting that Beijing Automotive’s first-half results showed that due to the increase in Beijing Benz’s revenue, the company’s revenue reached 66.737 billion yuan, an increase of 36.09% over the same period of last year; net profit was 9.8 billion yuan, a decrease of 59.12%. The first quarter of this year also showed that its total revenue rose 45.66% to 34.063 billion yuan, net profit rose 56.02% to 1.357 billion yuan.
This shows that in the second and third quarters, Beijing Automotive's performance is very optimistic.
Not only that, if you look at the performance of Beijing Auto's own brands, it will be even more chilly, and all this coincides with the point in time when Li Feng was promoted to be president of Beijing Automotive Co., Ltd. in 2013.
The financial report shows that in 2015 Beijing Motors lost 3.341 billion yuan in its own brand business, which was 1.9 billion yuan in 2014.
At that time, Li Feng was quite confident and full of pride: "Starting a business, you can't avoid the investment and loss at the beginning, but the loss is the process rather than the entire process. Today's loss is to be profitable tomorrow."
In 2016, Beijing Auto's own brand realized a net profit of 1.163 billion yuan, turning losses into profits and reversing. However, the sub-data contains Beijing Hyundai's profits. If you exclude this part of the income, Beijing Automotive's own brand net profit of -274.94 million yuan.
By 2017, even Beijing Hyundai could not save Beijing Auto's own brand.
The data shows that from January to November 2017, Beijing Hyundai’s cumulative sales reached 691,000 vehicles, a year-on-year decrease of 29%. The Beijing Automotive semi-annual report showed that the operating income of self-owned brands in the first half of the year dropped from 11.67 billion yuan in the same period last year to 8.424 billion yuan, a year-on-year decrease of 27.8%; net profit (including investment income) loss was 3.265 billion yuan.
This also means that in the past three and a half years, Beijing Modern’s own brand has lost 11.2 billion yuan.
Beijing Auto's own brands include Saab, Beijing, Weiwang and New Energy. From the perspective of the sales volume of specific brands, in the first half of 2017, Beijing brand achieved a total sales volume of 111,000 vehicles, a year-on-year decrease of 45.5%. In addition to the Beijing brand “outstandingâ€, the remaining three are declining. Among them, Shengbao fell from 92,000 units to 42600 units, Weiwang from 93,600 units to 40,000 units, and new energy representing the future trend also dropped from 15,100 units to 12,200 units.
Beijing Automobile said that due to the intensified competition in the domestic passenger car industry in the first half of the year and the overall downturn in the Korean car market, sales of Beijing brands and Beijing Hyundai declined, resulting in a decline in performance, which led to a drop in the Group's profitability.
Once again, "Chong A" welcomes sales to decline
Even if the sales of new energy vehicles decline, it will not change the direction of Beijing Automotive's efforts.
"By 2020, BAIC will take the lead in completely stopping the sale of its own-brand traditional fuel passenger vehicles in Beijing, and will completely stop production and sales of its own brand of traditional fuel passenger vehicles in China by 2025." Beiqi Group Party Committee Secretary and Chairman Xu Heyi promised to the outside world.
A few days ago, Beijing Automotive Group officially proposed the "Leading 2025 Strategy" for the development of new energy vehicles by BAIC. It is reported that BAIC will focus on pure electric power, EV (pure electric), PHEV (plug-in hybrid) and FCEV (fuel cell) three lines at the same time, to strengthen the integration of emerging technologies such as lightweight, intelligent and networked.
BAIC Group stated that it will strictly limit and eventually stop the production and sales of all conventional fuel vehicles in its own-brand passenger cars that do not use new energy and broad new energy technologies within China.
In the context of the global ban on fuel vehicles, after the Changan Automobile, BAIC was the second Chinese auto company to determine the schedule of banned fuel vehicles.
In 2025, Beijing Automotive Group plans to strive to build a "world-class new energy automotive technology innovation center" and build "world-class new energy automobile companies."
Dreams are always there, even if the previous dreams did not materialize.
Two years ago, Beijing Automotive Group had proposed a magnificent “pi planâ€. In 2020, BAIC will enter the top three among its own brands.
On October 13, 2015, Li Feng interpreted it into three keywords: "3", "1", and "4". That is, by 2020, it will achieve breakthroughs in the three major brands of Beijing Automotive: Beijing Auto The brand strives to rank among the top three domestic passenger car brands; Beijing Benz strives to rank first in the domestic luxury car market; and Beijing Hyundai guarantees the top four domestic passenger car market.
However, in the past two years, Beijing’s Mercedes-Benz is gradually realizing its goal. Beijing Hyundai is also slowly emerging from the pain, but its own brand is hard to pick up.
Moreover, after a lapse of 13 years, Beijing Auto, which has been listed on the Hong Kong stock market, once again "chong A," but sales fell or became a market pain point.
Recently, Beijing Automotive announced that it intends to make initial public offerings of A-shares. The raised funds, after deducting the issuance costs, will be used for the upgrade and reconstruction of production bases, expansion of technological upgrading projects, supplement of working capital, and repayment of bank loans.
A survey by the Changjiang Business Daily found that its own brand had 2.3 million production capacity, and it was estimated that there would be only 220,000 vehicles sold, less than 10%.
Xiao Yue told reporters of the Changjiang Business Daily that the independent brands have already entered the “elimination round†and Beiqi’s blind expansion of production capacity will cause a fatal blow to the company’s continuing operations.
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