As an old brand with a history of 58 years, JAC's passenger cars have never been able to stand out and can only find another way in external cooperation.
While the company was working for Weilai Automobile, it firmly hugged the thigh of Volkswagen through mixed reform, and the JAC brand basically withdrew from the competition of traditional passenger cars and was replaced by "Sihao".
Last year, after the major shareholders participated in the company's fixed increase at a low price, the second and third largest shareholders who held more than 5% of the shares took the opportunity to reduce their holdings at a high level, falling behind the insult of cutting leeks.
Hug the masses
After volkswagen entered China for more than 30 years, its cooperation with Chinese car companies has been sublimated in JAC.
In 2017, Volkswagen and Jianghuai Automobile (600418. SH) co-funded the establishment of a joint venture company, JAC Volkswagen, becoming the only foreign automobile brand to have a joint venture with three Chinese car companies.
Not only that, in order to be deeply tied to Volkswagen, Anhui also introduced Volkswagen to participate in the mixed reform of Jianghuai Automobile.
Without changing the controlling shareholder status of Jianghuai Automobile holdings over Jianghuai Automobile and the actual control of Anhui State-owned Assets, Volkswagen injected capital into both Jiangqi Holdings and Jianghuai Volkswagen, and Jiangqi Holdings changed from 100% shareholding of Anhui State-owned Assets to 50% of the shares of Volkswagen, at the same time, Volkswagen's shareholding in Jianghuai Volkswagen increased from 50% to 75%, and was renamed Volkswagen (Anhui).
Based on the increase in control, Volkswagen needs to tilt on resources.
According to the relevant agreement, the joint venture company will invest 1 billion euros and obtain 4-5 brand products of the Volkswagen Group, and in the B, C and other market segments, the joint venture company will be given priority when the products of the Volkswagen Group land in China.
The agreement also preliminarily stipulates that the joint venture will target production of 200,000-250,000 vehicles by 2025 (total revenue of 30 billion yuan) and 350,000-400,000 vehicles by 2029 (total revenue of 50 billion yuan).
In 2020, the joint venture has launched a new brand "Sihao", and there are currently 10 models including fuel vehicles and new energy on the market.
With the advent of the Sihao brand, the original Jianghuai brand of Jianghuai Automobile has basically withdrawn from the competition in the fuel passenger car market.
With the blessing of Volkswagen, the sales of passenger cars under Jianghuai Automobile have finally ended the continuous decline since 2017 and stabilized and rebounded in 2021. For the whole year, the company's total passenger car sales exceeded 200,000 units again, especially SUV sales increased by 117.55% year-on-year to 193,800 units.
In January this year, Jianghuai Automobile's SUV sales increased by 35.48% year-on-year, and monthly sales approached the 20,000 mark, but the performance of cars, MPVs and other models was still crotch-pulling.
JAC Motor is a comprehensive automobile manufacturer integrating the research and development, manufacturing and sales of commercial vehicles, passenger cars and powertrains, but in recent years, passenger cars have been dragging the entire group behind.
Since 2018, the gross profit margin of the company's passenger car sector has been abnormally low (both less than 5%), and in 2020, it has dropped to -2.48% for the first time, which is purely at a loss. During this period, the company's passenger car capacity utilization rate was low, 45.03% and 37.47% in 2018 and 2019, respectively, and in 2020, after the sale of some passenger car plants, equipment and other assets, the capacity utilization rate increased to 56.4%.
OEM for NIO does not last
Although traditional passenger cars have always performed poorly, in the field of new energy vehicles, Jianghuai Automobile has achieved good results. In 2016, the company's new energy passenger car sales increased significantly by 74.59% to 18,400 units, and in 2018, it doubled to 63,700 units. However, with the gradual decline of new energy subsidies, sales declined for two consecutive years in 2019 and 2020.
In the past 2021, Jianghuai Automobile's new energy passenger car sales soared, up 169.12% year-on-year to 134,100 units, but it is not clear whether Weilai Automobile is included in this sales data.
In 2016, Li Bin's Weilai Automobile was still in the research and development stage, and production qualification was a threshold that new car-making forces must face. Weilai found Jianghuai Automobile, and the two sides reached a cooperation agreement.
Since the first delivery of the ES8 in 2017, all of NIO's products have come from the production line of JacQue Automobile.
In order to carry out long-term cooperation with WEILAI Automobile, Jianghuai Automobile has invested more than 2 billion yuan to build a production line with an annual output of 100,000 high-end new energy vehicles. It was also agreed with WEILAI that three years before the project was put into production, WEILAI would fully compensate for the loss.
According to the financial report, from 2018 to 2020, Jianghuai Automobile recognized loss compensation of 126 million yuan, 207 million yuan and 0.65 billion yuan respectively.
According to the agreement between the two parties, JAC Automobile can OEM ES8, ES6, EC6 and other models for Weilai until 2024.
It is worth noting that in 2021, WEILAI Automobile sold 91,400 units for the whole year, which has been surpassed by Xiaopeng Motors. In December last year and January this year, Weilai Automobile's monthly sales growth was less than 50%, far lower than the new car-making forces such as Xiaopeng, Ideal, Nezha and Zero Run.
More importantly, NIO's own production capacity is under intensive construction. NIO has reached a cooperation with Hefei to plan to build an industrial park with an annual production capacity of 1 million vehicles, and the first phase of the factory is expected to be put into use in the third quarter of this year. At that time, the production of NIO automobile will be transferred to its own factory.
However, the two sides reached a new cooperation intention in March last year, jointly funding the establishment of Jianglai Advanced Manufacturing Company, which plans to lead production and manufacturing with innovation drive, promote the transformation and upgrading of the automobile industry, and explore the creation of innovative business models.
Major shareholders reduced their holdings at a high level
Since 2017, Jianghuai Automobile has deducted non-losses for four consecutive years, with a total loss of more than 4.6 billion yuan, and in the first three quarters of last year, the company deducted another loss of 701 million yuan. The company can maintain its listing status mainly by subsidies. From 2017 to 2020, the company received a total of 4.3 billion yuan in subsidies.
In addition to subsidies, the sale of assets is also an important means for companies to maintain book earnings.
In 2019, the company once promoted the transfer of control of Ankai Bus through equity transfer, which lasted more than 1 year, and finally failed because it could not reach a final agreement in the short term.
In 2020, the company transferred assets such as the assembly workshop of the second passenger car plant to Volkswagen (Anhui) for a transaction consideration of 770 million yuan;
In 2021, the company successively transferred the equity of passenger car logistics shipping yards, test tracks, and holding shareholding companies such as Jiangfu Vehicle Body and Kaimeisi, all of which obtained certain benefits.
For the company's future development trend, the company's top shareholders expressed different opinions with practical actions.
In April last year, Jianghuai Automobile raised 2 billion yuan from the controlling shareholder Jiangqi Holdings to repay loans and supplement working capital, with a fixed increase price of 6.88 yuan, which was about 75% off the closing price of the base day.
After the landing of the fixed increase, the company's stock price ushered in a wave of explosion, and on July 26 of that year, it once touched a high of 21.90 yuan.
During this period, Anhui State Holdings Group and Construction Investment, the second and third largest shareholders holding more than 5% of the company's equity, urgently reduced their holdings.
CcIC invested in 2021/8/2-2022/1/27, through centralized bidding, to reduce the company's 16.5 million shares at 13.50-20.90 yuan / share, reducing the shareholding to less than 5%.
Anhui State Holdings Group, a subsidiary of Anhui State-owned Assets, reduced its holdings by more than 300 million yuan at 15.01 -18.10 yuan per share from 2021/8/30-2021/12/1, and at present, the reduction plan has not yet been implemented.