Recently, car companies seem to have fallen in love with "demolition".
According to recent reports, Volkswagen Group and Ford Motor announced a split plan, the former confirming the rumor that Porsche will be listed independently, and the latter announcing a new strategy of splitting the electric vehicle business and the fuel vehicle business into Ford Model e and Ford Blue.
Looking ahead, Intel wants to dismantle its autonomous driving business Mobileye to list in the United States, BYD Semiconductor launched a split process, and Geely Automobile split the electric vehicle marketing business and pre-established a new pure electric vehicle company.
Judging from the actions of the car predator, is the end of the automotive industry really dismantled?
Splitting the "cash cow", traditional car companies want "gorgeous transformation"
Porsche to the public, can be said to be a cash cow-like existence.
According to public information, in the first half of 2021, Porsche's global operating income reached 16.53 billion euros, and the sales profit was 2.79 billion euros, achieving a sales return rate of 16.9%. During the same period, Porsche delivered 153,700 new vehicles worldwide, including 48,700 new vehicles in the Chinese market.
Earlier, rumors in the media about the listing of Porsche were frequent. As early as 2018, Porsche CFO Maxig proposed the idea of an independent IPO to unlock value, but it was not supported by the public. By February 2021, foreign media reported that Volkswagen was considering splitting Porsche into a market. But then Volkswagen CEO Herbert Dies denied the news.
This year, Volkswagen officially issued a statement saying that it and the board of directors of Porsche Holdings have reached a framework agreement that ensures that Jet will be listed independently and will complete the IPO as soon as the fourth quarter of 2022.
So why did Volkswagen, which refused to "let go" several times, agree to split Porsche? This brings us to another ultra-luxury car brand, Ferrari.
Ferrari was listed in 2015 at an issue price of $52 per share. As of the close of the US stock market on March 4, Ferrari was quoted at $198.41, up nearly 4 times from the issue price. Looking at the company's performance in the past quarter, according to the data, Ferrari delivered a total of 10,131 vehicles to customers around the world in 2021, which is the first time since its inception that its annual sales exceeded 10,000 vehicles. During the same period, Ferrari generated an unprecedented net income of 3,766 million euros, an increase of 10.1% year-on-year.
With the "pearl" in front of it, creating brilliant results, it is not difficult for the public to understand that porsches want to launch and copy a new "Ferrari".
Previously, the company also unveiled a new round of five-year plans, expecting to invest a total of 159 billion euros over the next five years, of which 89 billion euros will be spent on technologies such as software and electric vehicles, accounting for 56% of the total investment. This is enough to see that volkswagen wants to upgrade and innovate. However, the company's revenue in the third quarter of 2021 was only 56.93 billion euros, which is difficult to support such a huge investment amount, and then promoting porsche listing to raise funds will help Volkswagen better transform to electric vehicles.
However, whether Porsche can achieve as well as Ferrari, the market is still questionable, because Volkswagen's trucking division Tratton, which was spun off and listed in 2019, is now lower than the issue price, and it is difficult to say that Porsche will not go the same way.
Look at another traditional car company, Ford Motor.
On March 2 this year, Ford officially announced that it will split the electric vehicle business and the fuel vehicle business into two separate divisions, namely Ford Model e and Ford Blue. Ford Model e is responsible for the development of software, intelligent networking technology and services for Ford's various business units, while Ford Blue provides vehicle hardware engineering and manufacturing support for other Ford business units.
Behind these strategies, carrying the expectations of Ford's transition to electric vehicles, the company expects its electric vehicle production to exceed 2 million in 2026, and hopes to surpass the share of fuel vehicles in the market share of electric vehicles.
It should be noted that because the Ford family could not accept the CEO's strategy of completely splitting the electric vehicle business into separate companies, the company eventually adopted the form of a spin-off division, although Ford Model e and Ford Blue will operate as separate business units, but still under the entire Ford motor company. Therefore, even if there are short-term problems in the electric vehicle business, Ford can still rely on the fuel vehicle business to turn things around.
When under pressure, the split listing may usher in the "second spring"
Mobileye, an Intel-owned self-driving company that will go public in the middle of this year, estimates the company's valuation is more than $50 billion.
Although the market's attitude towards Intel is not very optimistic, JPMorgan Chase, Citi and other institutions have downgraded it, but mobileye, which is valued at $50 billion, still has a certain confidence.
Mobileye has decades of experience in chip design, according to the statistics of Wisdom Bud, as of now, Mobileye Vision Technologies, a subsidiary of Mobileye, has more than 620 patent applications, nearly 300 effective patents, and 610 patents.
Against this background, Intel has invested in a talent pool and factory support to help it grow. And even if the market share has been eroded to a certain extent, Intel still has a lot of research and development experience in chip technology, which can bring a lot of help to Mobileye.
In addition, according to the Beijing News, SAIC Motor, BYD, Great Wall Motor, GUANGZHOUC Group and other car companies have also tried to split the core business modules and push them to the capital market. Among them, SAIC Motor will spin off its 3 subsidiaries - Jie Hydrogen Technology, Zhonghai Ting and Lianchuang Technology. Choosing to split its subsidiaries in different fields, SAIC Motor aims to expand financing channels and improve financing flexibility, thereby further enhancing the momentum of development.
Renault, on the other hand, has chosen a similar split to Ford, and may also split its electric vehicle business and internal combustion engine business into two "separate entities." In the eyes of Luca de Meo, CEO of Renault Group, this is part of Renault's revival plan. Auto analyst Zhang Xiang told The China Business Daily that multinational car companies chose to split, in essence, in order to obtain more financing.
Industry analysis believes that in the increasingly fierce competition, car companies need to expand their business, seek new growth points, and also need more funds to support the transformation of the new four modernizations such as electrification, and spin-off listing is a good way.
Behind these "tides" of splitting, whether it is a car company or a technology company, it follows a truth, that is, to get more financing, enhance their own value, and thus gain more recognition in the capital market.
epilogue
At present, the popularity of new energy vehicles is obvious to all, not only traditional car companies in the transformation, new forces in the force, even millet,
Tencent, Baidu, Apple and other technology companies have joined the track. The trend of splitting from vehicles to autonomous driving software to fuel and other segments shows that there is a broad value space in the entire automotive industry chain, which is enough to support the independent listing of different departments.
Under this, companies choose to split their businesses and go public separately, which can better promote the development of electric and intelligent businesses and thus enhance value.
However, whether the split business can be as people wish, everything depends on the company's own ability.