Anhui promotes restructuring of the automotive industry in the province

Conforming to the need for a reduction in the number of national auto enterprise groups and avoiding reorganization by enterprises outside the province is the main reason why the Anhui provincial government is anxious to promulgate and promote the "great unification" policy.

Can you imagine a super-brand auto enterprise group covering cars, light trucks, heavy trucks, passenger cars and related auto parts? Not yet, but all this is likely to become a reality in the near future.

On May 12, Anhui Province promulgated the "Automobile Industry Adjustment and Revitalization Plan of Anhui Province", pushing Chery (parameter configuration), JAC, Hualing, Yangzi, Quanchai, and other automobile companies to carry out joint reorganization in the province according to market principles, striving A car enterprise group with a production capacity of more than one million cars will be formed; in addition, it will also build 2 to 4 auto parts production enterprise groups with advanced domestic level and 5 to 7 automotive industrial clusters.

This was the direct response of the Anhui provincial government after Chery entered the list of countries that encouraged local mergers and reorganizations in March. Anhui Province hopes to build a large automobile manufacturing enterprise group with a production and sales scale of 1 million through joint reorganization in the region. Conforming to the need for a reduction in the number of national auto enterprise groups and avoiding reorganization by enterprises outside the province is the main reason why the Anhui provincial government is anxious to promulgate and promote the "great unification" policy.

On the strength of reviving considerable JAC and Chery have been avoided in the restructuring issue. During the two sessions, Zuo Yanan, chairman of the Jianghuai Automobile Group, publicly stated that he does not approve of Chery JAC's "reorganization," but should mention "cooperation and reorganization," and stressed that "there is no question of who is integrating whom." Coincidentally, Yin Tongyue, chairman of the board of directors of Chery Automobile Co., also stated that at present, the cooperation between Jianghuai and Chery is limited to engines, transmissions, and supply chain systems.

“The expansion of the respective scale of the two companies has increased the difficulty of integration from the perspective of reorganization.” A person close to Jianghuai’s top management revealed that it is difficult to achieve a reorganization between the Jianghuai and Chery. Cases of domestic auto mergers and reorganizations, such as the latest SAIC acquisition of NAC, can be seen that the two companies with disparate strengths are not easy to achieve seamless connection between capital and industry.

In fact, from the perspective of their respective business structures, the integration of JAC and Chery is undoubtedly a natural match. Chery is known for its sedans business and its mini-vehicle business has just started. JAC's advantages lie in light trucks, chassis, and commercial vehicles. The car segment has just started. The combination of the two can not only complement each other, but also eliminate redundant departments, share R&D and platforms, and significantly reduce costs and improve efficiency.

However, there are many problems facing the two companies, and cultural integration is one of them. Different "origins" and experiences have created two different cultures of Jianghuai and Chery Automobile. JAC is characterized by rigorous and pragmatic practices, while Chery is even more active. Regardless of the speed of product launch and update, or marketing, they all show great differences from JAC.

In addition to the problems of cultural integration, many issues such as the proportion of their respective shares in the new auto group, their respective seats in the management, and who has the right to speak are quite tricky. The current situation has made it impossible for the relevant departments in Anhui Province to merge and restructure.

"Swiftly acting may make the Anhui auto industry's efforts for more than 40 years destroyed. It should be based on the provincial conditions to choose their own path, the best way is to 'take in'." Analysis of the industry, with the help of SAIC, Guangzhou Automobile's ready experience, The formation of the Anhui Automobile Investment Holding Group with assets as the link should be a more feasible approach at present. In the future, Anqi Group will invest in shares on behalf of the SASAC, forming a diversified property rights structure within the company. It will include Chery, JAC and other companies under its umbrella. Related companies are second-tier legal persons within a large group. The original enterprises are still relatively independent and share resources. Unified planning.

Once this becomes a reality, the Chinese auto super-brand enterprise group will also be born.