With the release of the new version of the negative list for foreign investment access, in a few days, the restrictions on the joint venture share ratio of the automobile industry, which has been implemented for 27 years, will be completely abolished.
According to the new version of the negative list, from January 1, 2022, China will remove the restriction on foreign ownership in passenger car manufacturing and the restriction that the same foreign company can establish two or less joint ventures in China to produce similar vehicle products. In the past nearly 30 years, in order to protect its own brands and also to protect the market, the state has imposed a 50:50 equity ratio limit on joint venture car companies. Nowadays, some independent brands have gradually grown up in order to make a living, and some car companies that do not want to make progress have gradually fallen after the joint venture. With the gradual liberalization of the restrictions on the share ratio, there have been wholly foreign-owned car companies in the past two years.
First of all, in the field of commercial vehicles, sichuan hyundai completed the change of shares in early 2020 and became a 100% Korean-funded enterprise. This was followed by Tesla's wholly owned factory in Shanghai. Volvo also signed an agreement with Geely in July this year to acquire Geely's shares and become a wholly owned company. Other foreign brands are actually also eager to move, darkening their positions and beginning to make a fuss about the equity ratio of joint venture brands.
So after 2020, which companies are likely to become sole proprietorships? Let's make an irresponsible guess.
BMW Sole Proprietorship Probability: 90%
BMW's desire to covet BMW Brilliance has long been there. As early as 2018, BMW formally signed an agreement with Brilliance that BMW would increase its stake in BMW Brilliance to 75% and become a controlling party. The agreement came into effect in 2022, and the timing is just right, indicating that BMW has begun to deploy four years in advance.
When Brilliance Group went bankrupt, BMW began to plan to acquire Brilliance China's production qualifications, equipment and other assets at a premium. This is clearly in preparation for the future production of wholly-owned electric vehicles. Although the acquisition is temporarily blocked, BMW's plan should not change, and now the key is to see whether it can dispel the concerns of the Liaoning government.
Mass Sole Proprietorship Possibility: 90%
Volkswagen China has acquired a 50% stake in Jiangqi Group and a 75% stake in Volkswagen Anhui. From the initial 50:50 share of Jianghuai Volkswagen, to the later expansion of the shares to 75% and renamed Volkswagen Anhui, Volkswagen's ultimate purpose is to pave the way for the future wholly-owned production and manufacture of new energy vehicles.
Like BMW's acquisition of Brilliance, it is actually easy for the wealthy Volkswagen to take away the remaining shares of Jianghuai, and in the end it is only to see whether the Anhui government will nod. After all, welcoming Tesla as generously as Shanghai and then signing a VAM agreement is not something that every local government can do.
JEEP probability: 90%
Many of the Brands of the Stellantis Group have joint ventures in China. At present, the biggest possibility is GAC FCA's JEEP brand. The news that GAC FCA, which has lost 5 billion yuan in three years, has already accumulated a lot of money, and the news that GAC Group will transfer 20% of the shares of GAC FCA to Stellantis Group has been spread for several months, and so far it has not been confirmed. However, there are no winds and waves, and in terms of the current situation of JEPP, the possibility of GAC withdrawing and becoming a sole proprietorship of Stellantis is still very large.
Stellantis also announced earlier that it will announce a new strategy before the end of the year, and integrate the Jeep brand's import business and joint venture business in China. Not long ago, Stellantis postponed the announcement of the new strategy to March 2022, I don't know if it is because of the size of the matter, so that Stellantis has to be cautious.
Citroën/Peugeot Exclusive Likelihood: 40%
Stellantis and DPCO's other two joint ventures, Citroen and Peugeot, have had a hard time in recent years. While DPCA is still struggling to "recover," it's hard to guarantee that Stellantis has no other ideas. After all, the French way of thinking we never understand.
Earlier, there were rumors that Stellantis had officially started communication with Dongfeng Motor to discuss plans for the adjustment of DPCA's shares. It is said that citroen and Peugeot brands will be divided by Dongfeng and Stellantis, so does it mean that there will be a brand development that becomes wholly foreign-owned in the future? Another notable sign is that Dongfeng Group has sold its stake in Stellantis several times in recent years. In other words, the "decoupling" of Dongfeng and Stellantis is silently underway.
Kia Sole Proprietorship Probability: 50%
Just last month, Dongfeng Motor's project to transfer 25% of Dongfeng Yueda Kia's equity was officially listed on the Shanghai United Assets and Equity Exchange at a transfer price of 297 million yuan. At that time, it was widely believed that the 25% stake would most likely return to hyundai Kia Group, which would acquire 75% of the equity and then control Yueda Kia, and at some point in the future, it might even increase its holdings again and then solely own the holdings.
However, this month, the 25% stake was finally eaten by Yueda Group, which was quite unexpected. It seems that South Koreans are still more cautious and cautious, and do not dare to do things boldly like European and American car companies. It may also be that at present, Hyundai Kia Group is probably hesitant about the prospects of Korean brands in China, and whether it should throw money down to engage in sole proprietorship has not yet made up its mind. Fortunately, Yueda Group is a "soft persimmon", and the sense of existence in the original tripartite shareholders is not strong, and once Hyundai Kia has made up its mind, it is not difficult to acquire The shares of Yueda.
Modern Sole Proprietorship Possibility: 30%
Beijing Hyundai has already sold one factory, is still selling a second factory, and may sell a third and fourth factory in the future. After all, 80% of the total production capacity of more than 1.5 million vehicles is currently idle. Didn't Hyundai Kia Group ever think about sole proprietorship? I guess not. But on the one hand, out of caution, on the other hand, holding the two brands of Hyundai and Kia, Hyundai Kia Group will definitely weigh the pros and cons, there are first and then. Maybe first pick up the sub-brand to test the waters, and then use the knife to the modern brand.
Since there is a precedent of Sichuan Hyundai's sole proprietorship, it proves that Hyundai Kia Group is not unwilling to be sole proprietorship, it depends on whether the market can give Hyundai Kia more confidence.
Mercedes-Benz Sole Proprietorship Possibility: 10%
Among the above brands, Xiaobian is the one who most hopes that Mercedes-Benz will be solely owned. Why do you say so, because now Beijing Benz is gradually losing its vitality. Most of the Employees of Beijing Benz have been working in the Mercedes-Benz system for more than 10 years, and the insiders are superfluous, the bureaucracy is serious, and there are many people who are chaotic. Mercedes-Benz wants to make some gains in the field of new energy vehicles in the future, in fact, it should follow the example of Volkswagen and stand on its own or set up another portal. It's just that Beijing Benz is the only cash cow in BAIC at present, and BAIC will obviously not easily give up its shares, or watch Mercedes-Benz leave.
Write at the end:
After imagining so much, the last thing I want to say is that with the cancellation of the stock ratio, there will be a new round of adjustment in the future pattern of China's auto industry. Whether it is for foreign brands that want to expand or even monopolize the right to speak, or independent brands that are growing vigorously, the next battle in the automotive market will become extremely exciting. (Text/UVIS Auto Old Cannon)
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