When "old news" becomes "news", it must be worth savoring.
On December 13, a news from BAIC and Daimler rushed to the hot search, but if you look closely, it is two years ago.
According to the announcement, on December 13, Beijing Automotive Group Co., Ltd. (hereinafter referred to as "BAIC") announced that in order to strengthen the long-term strategic cooperation between the two sides, it has increased its shareholding in Daimler AG (hereinafter referred to as "Daimler") to 9.98% in 2019 through continued investment. This shareholding ratio is slightly higher than that of Geely Group.
In response, Daimler CEO Conlinson said in a statement: "BAIC's shareholding reflects our commitment to our joint manufacturing and development alliance in the world's largest automotive market. ”
Under an agreement between the two sides, BAIC confirmed that it would not further increase its stake in Daimler.
The daimler dispute between BAIC and Geely
BAIC Group has a long history with Daimler Group.
Daimler has established a long-term strategic partnership with BAIC since 2003. In 2005, the two parties formally established Beijing Benz, and at present, in Beijing Benz, BAIC Group holds 51% of the shares and Daimler holds 49% of the shares.
In 2013, BAIC Group and Daimler proposed a plan for cross-shareholding between the two sides, which is also known as the cooperation of "Beidaihe", and agreed that after Daimler holds the shares of BAIC, BAIC will also take a stake in Daimler. In 2013, Daimler invested in the acquisition of BAIC Motor, a Hong Kong-listed company under the BAIC Group, and has since become a member of the board of directors of BAIC Motor, with a current shareholding ratio of 9.55%. In 2018, Beijing Benz acquired a plant of BAIC Group in Shunyi, Beijing. In the same year, Daimler acquired part of the shares of Beijing New Energy Automobile Co., Ltd., a subsidiary of BAIC Group, and Daimler currently holds 2.46% of the shares.
On July 23, 2019, BAIC Group announced that in order to strengthen the long-term strategic cooperation between the two parties, it will invest in Daimler AG and hold a 5% stake in Daimler AG. The transaction consisted of a direct shareholding of 2.48% and the right to obtain an additional equivalent to 2.52% of the shares. With this investment in Daimler, BAIC Group became the third largest shareholder of Daimler, and at that time, Daimler's largest shareholder was Geely Automobile, holding 9.69% of the shares.
In February 2018, Geely raised $9 billion to acquire 9.69% of Daimler's shares through secondary market operations, shocking the industry and becoming Daimler's largest single shareholder.
Since then, the cooperation between the two sides has gradually advanced and deepened. In October 2018, Geely announced its intention to cooperate with Daimler in the field of high-end travel, and the two sides jointly established Weixing Technology Co., Ltd. with a registered capital of 1.7 billion yuan and a 50% stake in each.
In March 2019, Geely once again joined hands with Daimler to provide a solution for its loss-making smart brand, and the two sides will each hold 50% of the shares to form a joint venture company to promote the transformation of the smart brand into a global high-end electric intelligent car brand, and create a high-end travel brand "Yao Travel". Soonest, the first pure electric vehicle products will be put on the market and sold worldwide from 2022.
In less than two years, the two sides have reached a consensus on the two major future trends of shared travel and electrification, and Geely and Daimler have become increasingly close partners.
Perhaps it is precisely because Geely's shareholding has made BAIC feel threatened, so that BAIC chose to announce the news of increasing its holdings in Daimler at this point in time.
At this time, there are less than two months to go before the timeline of the opening of the full equity ratio of China's automobile industry to foreign capital will come. Some people say that BAIC can quietly hide its 9.98% stake in Daimler for two years, and only announced the news at the critical line of opening the joint venture share ratio, indicating that the game of power, market and interests involved behind it must be particularly intense.
Mercedes-Benz is very important to BAIC, but on the other hand, why does Daimler also gladly accept the increase of BAIC?
Why does Daimler "welcome" BAIC to increase its holdings?
In short, the reason is not baicqi, but the Chinese market.
As one of the world's largest luxury car manufacturers, the Chinese market has become Daimler's most important market, and the importance of Beijing Benz to Daimler is self-evident.
The most direct manifestation is the calculation of the financial statements according to the equity method, and if the control of the joint venture company Beijing Benz is realized, Daimler can incorporate its revenue in the financial statements and increase the revenue scale of the entire group. At the same time, the increase in the share ratio will also allow the Daimler Group to get more profit distribution.
In addition, Daimler is currently in a period of deep transformation, and a large amount of R&D investment needs more "blood" supplies.
Around 2018, in order to meet electrification and digital transformation, Mercedes-Benz had to start a large amount of research and development investment. In 2019, Daimler's net profit was cut from the waist, falling sharply by 64.5% to 2.7 billion euros, the biggest decline in a decade. At the same time, the Daimler Group lost nearly 5 billion euros as a result of events such as diesel emission gates and Takata airbag recalls.
Since the second half of 2019, Daimler has begun to "slim down", and Kang Linsong, chairman of the board of directors of Daimler AG and Mercedes-Benz AG, has had to start measures to cut costs and increase cash flow. These include significant reductions in material and administrative costs, as well as a reduction of more than €1.4 billion in labor costs by the end of 2022 and a reduction in jobs, including management positions.
In contrast, the market performance of Daimler's joint venture in China, Beijing Benz, has been trending towards steady growth, and even in 2019, when Daimler lost the most, its performance in the Chinese market reached 364 million euros.
For Daimler, which is currently in a period of transition, it is undoubtedly beneficial to stabilize its own revenue and profits by increasing its stake in Beijing Benz.
On the other hand, some analysts believe that Daimler itself hopes to introduce capital from BAIC to balance Geely. Judging from the fact that Geely has quickly reached a business cooperation with Smart in the field of travel after investing in Daimler, Geely's stake in Daimler is not only in "investment income", but also hopes to make profits through cooperation in specific businesses.
After the acquisition of BAIC, a balance has been temporarily reached, and Mercedes-Benz hopes to see a three-legged stand, and the purpose is still its own control.
In this way, Daimler's triangular relationship with Geely and BAIC will be more attractive.
Write at the end:
For BAIC Daimler, the outside world's ideas do not stop there.
In April 2018, the National Development and Reform Commission said that it would abolish the restrictions on foreign ownership of special vehicles and new energy vehicles in that year; the restriction on foreign ownership of commercial vehicles in 2020; and the restriction on foreign ownership of passenger cars in 2022, while abolishing the restriction on no more than two joint ventures.
In October of the same year, BMW successfully increased its stake in BMW Brilliance by 25%, becoming the first beneficiary of the Chinese government's relaxation of the restrictions on foreign investment in China in the automotive industry. Since then, Volkswagen has also achieved its wish and successfully held 75% of the equity of JAC Volkswagen.
As a top three Aspires-german, what kind of posture will Mercedes-Benz start its journey in China in 2022? Worth looking forward to.