Dongfeng Group and Kia "broke up", and the "feelings" in 19 years were not worth 300 million yuan

Following Dongfeng Yulon and Dongfeng Renault, Dongfeng Group lost another joint venture brand - Dongfeng Yueda Kia, and successfully achieved 3 "breakups" in 3 years.

On December 18, the official website of the Shanghai United Equity Exchange showed that the 25% equity transfer project of Dongfeng Yueda Kia was delisted at a transfer price of 297 million yuan. With the completion of the transaction, Dongfeng Yueda Kia will change from a tripartite joint venture to a shareholding held by both Yueda and South Korea's Kia.

It is understood that after the withdrawal of Dongfeng Company, the company's shareholding ratio is still in consultation with Yueda, and the final results are expected to be announced in April next year.

According to the data, Dongfeng Yueda Kia was jointly established by Dongfeng Motor Group Co., Ltd. (Dongfeng Group), Jiangsu Yueda Investment Co., Ltd. and South Korea Kia Motor Co., Ltd. in 1992, with a shareholding ratio of 25%, 25% and 50% respectively, and the joint venture business period was from September 12, 1992 to September 11, 2022. Judging from the business period of the joint venture, it is currently less than 1 year since the expiration of the tripartite joint venture.

Dongfeng Yueda Kia also had a "brilliant period".

In the three years from 2014 to 2016, the annual sales of Dongfeng Yueda Kia exceeded 600,000 vehicles, of which more than 650,000 vehicles were in 2016, which was also the peak moment of Dongfeng Yueda Kia.

Since 2017, Dongfeng Yueda Kia has begun to go downhill, and its sales have also been "waist chopped" year by year. In 2017, Dongfeng Yueda Kia's sales plummeted to 359,000 units, rebounded slightly to 370,000 units in 2018, fell again to 289,800 units in 2019, sold only 249,000 units in 2020, and only 137,900 units sold in the first 11 months of this year. According to statistics, in the past five years, Dongfeng Yueda Kia has lost more than 9 billion yuan.

Affected by the sluggish sales volume, in 2019, Dongfeng Yueda Kia also leased the first factory with idle production capacity to Huaren Express (Gaohe Automobile) to save costs.

In order to return to the old track, at the end of 2019, Dongfeng Yueda Kia, which has been established for 17 years and has been the general manager of the Korean side for 9 years, ushered in the first Chinese general manager - Li Feng. The industry veteran who proposed that "it will take at least 3 years to propose technical and other adjustments" when he first took office has not been able to fulfill his promise of 3 years of strategic adjustment. In March this year, Li Feng voluntarily left his post, and the Korean side continued to take over the position of number one.

Informed sources have revealed that Li Feng has little say in Dongfeng Yueda Kia, there are many difficulties on the road to reform, and important functional departments such as procurement rights have been controlled by the South Korean side.

It is worth mentioning that the leader of Dongfeng Company said in an interview with the media earlier that Dongfeng Group did not substantively participate in the daily operation of Dongfeng Yueda Kia, but more to provide it with car-making qualifications.

This series of operations also lays "hidden dangers" for the future "breakup" of the two parties.

In recent years, affected by the beginning of independent brands and the strong support of domestic policies for the development of the new energy automobile industry, a number of joint venture brands under Dongfeng Company have begun to operate poorly, from the previous Dongfeng Yulon, to Dongfeng Renault, and now To Dongfeng Yueda Kia, Dongfeng Company and the other shareholders have finally reached a "breakup" willingness. Many analysts in the industry have pointed out that the biggest disadvantage of the above brands is that they are "unsatisfactory" in China.