Yangtze River Business Daily News ● Yangtze River Business Daily reporter Wang Jing
Lu Weiding, the second-generation head of the "Wanxiang Department", is accelerating the integration of the group's assets.
Recently, Wanxiang Qianchao (000559. SZ) disclosed a major asset restructuring plan, and the company intends to purchase 100% of the equity of Wanxiang America Corp. (hereinafter referred to as "WAC") held by Wanxiang America.
Wanxiang USA is an important platform for Wanxiang Group's overseas layout, and since its establishment 30 years ago, it has laid out the global auto parts industry chain through acquisitions and other means, and this restructuring is a part of the integration of the core auto parts assets of the "Wanxiang system".
"Wanxiang Department" was founded by the legendary Zhejiang businessman Lu Guanqiu, who started from auto parts Lu Guanqiu has always had a dream of building a car, and in 2017, he passed this dream and the huge Wanxiang empire to his son Lu Weiding. But after 7 years of taking over, Wanxiang's road to car building has not yet seen the end.
Lu Weiding made good use of financial and capital means, and the "Wanxiang System" has controlled four listed companies, but both IPOs have failed, the IPO of Ocean Family has been terminated, and the IPO of Wanxiang 123 has made no substantial progress.
In the era of Lu Weiding, where will the "universal system" go?
The rich second generation who plays finance
"One generation is engaged in industry, and the second generation is engaged in finance." Like most family businesses in China, the Wanxiang Lu father and son follow this "law".
Lu Guanqiu's life is a legendary life with the characteristics of the times. Born in 1945, he worked as an apprentice blacksmith and opened a flour grinding workshop, and in 1969, he led six farmers and raised 4,000 yuan to establish the Ningwei Commune Agricultural Machinery Factory. Quite far-sighted Lu Guanqiu judged that the country will vigorously develop the automobile industry, he firmly believes that this is an opportunity, so he adjusted the production focus of the factory, specializing in the production of universal joints suitable for automobiles, starting from a small part, Lu Guanqiu's dream of building a car sprouted.
In the past few decades of development, Lu Guanqiu has sold the "Qianchao brand" car universal joints to 18 countries such as Japan, Italy, and France. In 1994, Wanxiang Qianchao, the core enterprise of Wanxiang Group, landed on the A-share market, and subsequently, its Wanxiang Denong, Chengde Lulu, Shunfa Hengfa, etc. successively landed on the A-share market, and the well-known "Wanxiang System" in the capital market was born.
Unfortunately, the dream of building a car has not yet been realized, and in 2017, Lu Guanqiu passed away and his son Lu Weiding took over. As a "rich second generation", Lu Weiding loved drag racing when he was young, and was sent to Singapore to study in high school. After returning to China, he was personally trained by Lu Guanqiu, and then went abroad for further study, and in 1992, Lu Weiding, who was only 21 years old, served as the assistant general manager of Wanxiang Group. Two years later, Lu Weiding took over the position of president of Wanxiang Group from his father.
Unlike his industrial father, Lu Weiding is more keen on finance and capital operation. Under his leadership, in 2001, Wanxiang Holdings, as a "Wanxiang system" financial investment platform, was established, and Lu Weiding served as an executive director, and unlike its four listed companies, Lu Weiding of Wanxiang Holdings has a very strong personal color, and the Lu family's holding ratio in the company is as high as 90%. Wanxiang Holdings is involved in a number of investment fields, with as many as 20 financial institutions participating in the holding, with trust, banking, insurance, fund, payment, futures and other licenses, and also participates in Huayi Brothers, Guangzhou Automobile Group and other listed companies.
However, in recent years, Lu Weiding's capital operation has also suffered setbacks, and the IPO of his two companies has been quite unsmooth.
On March 3, 2023, Ocean Family, which is engaged in the production and sales of marine food and deep-sea fishing, submitted a listing application to the Shanghai Stock Exchange to be listed on the main board, but on July 24 of the same year, Caitong Securities, the sponsor of Ocean Family, submitted a withdrawal application to the exchange, and the IPO of Ocean Family was terminated. In addition, Wanxiang Group's important layout in the field of lithium batteries, Wanxiang 123, announced the launch of its IPO in 2021, but there has been no new progress so far.
Today, Lu Weiding, who controls the universal system, has a thick net worth. According to the 2023 Hurun Report released by the Hurun Research Institute, the Lu Weiding family ranks 105th with a wealth of 44 billion yuan.
Father and son have a long way to go to build a car
Although he is now in the financial field, starting from a small car gimbal, Lu Guanqiu is obsessed with making cars. He once said: "My generation will not succeed, and my son will continue; My son couldn't make it, and my grandson continued. And this sentence also seems to foresee the tortuous road of "universal system" car building.
Undoubtedly, the same as the earliest car outlet, Lu Guanqiu's vision is long-term. As early as 1993, Wanxiang Group began to lay out overseas markets, established Wanxiang USA, and expanded the international market on this basis. After initially entering the list of global multinational automotive OEM suppliers, Wanxiang USA quickly started its M&A expansion plan. Since 1998, Wanxiang USA has successively acquired UAI, a major brake parts manufacturer in the United States, QA1, a transmission parts company DANA, a bearing company GBC, and a brake parts company BPI. In recent years, the company has also acquired A123 Systems, a U.S. battery company, in an attempt to enter the field of new energy vehicles.
At the same time, as early as 2012, when new energy vehicles were still in the wild era, Wanxiang acquired electric vehicle manufacturers and entered the power battery. In 2014, Wanxiang America acquired Fisker, a competitor of Tesla, and renamed it Karma, positioning itself as a luxury electric vehicle company and laying out the U.S. market. In 2017, the car was officially launched in the United States.
However, even if it got involved in the new energy industry so early, Cama did not make much waves, but the competitor Tesla, the old car company BYD, and the rising stars led by NIO Ideal are making cars vigorously.
In fact, Lu Weiding's investment in car manufacturing is not small, but it is not improving. As early as 2017, Lu Weiding planned to invest 200 billion yuan to build a Wanxiang Innovation Energy City, involving 12 key construction projects such as batteries, new energy passenger vehicles, and research institutes, with a construction time of 5 to 7 years.
Some people in the industry believe that through a series of industrial chain acquisitions over the years, Wanxiang Group has already possessed vehicle manufacturing capabilities.
Recently, around the automobile industry chain, Lu Weiding has made new moves. On May 5, Wanxiang Qianchao announced that the company intends to purchase 100% of the shares of WAC held by Wanxiang United States by issuing shares and paying cash, and at the same time intends to issue shares to no more than 35 specific investors to raise matching funds.
Wanxiang Qianchao is an integrated supplier of bearings and chassis integrated system components, while WAC is mainly committed to the R&D, production and sales of high-end automotive transmission systems and steering systems, and is the core component supplier of major global automobile OEMs.
WAC's performance was impressive. According to the data, WAC's operating income in 2023 will be about $1.336 billion, and the net profit will be $98.15 million.
Wanxiang Qianchao said that through this transaction, the company will further enhance the breadth and depth of its global business layout, significantly improve the response speed and reliability of the company's supply chain in Asia, Europe and the Americas, better integrate into the supply chain system of major OEMs around the world, and further increase its global market share.
It is worth noting that the performance of the four listed companies in the Wanxiang system has not made much progress since Lu Weiding took over, and some have even regressed.
In 2017, Wanxiang Qianchao, Chengde Lulu, Wanxiang Denong and Shunfa Hengye achieved operating income of 11.15 billion yuan, 2.112 billion yuan, 259 million yuan and 6.682 billion yuan respectively; The net profit was 882 million yuan, 414 million yuan, 57.63 million yuan and 765 million yuan respectively.
In 2023, the operating income of the above four companies will be 14.49 billion yuan, 2.955 billion yuan, 319 million yuan, and 2.237 billion yuan respectively, and the net profit will be 822 million yuan, 638 million yuan, 65.29 million yuan, and 313 million yuan respectively. Among them, Wanxiang Qianchao and Shunfa Hengye's net profit have regressed significantly.