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As sales continue to decline and the auto industry enters the life-and-death knockout round, many industry insiders predict that 50% of China's car companies will collapse. In 2019, car companies and automobile suppliers have business difficulties one after another, losses have become the mainstream, and news of stopping production and unpaid wages emerge one after another. Traditional automobile companies sell land and sell qualifications, and even enter a difficult time of merger and reorganization.

For car companies, the sharp decline in sales is currently facing the most serious thing, the lost share is very difficult to get back, a little inadvertently will be eliminated by the market. According to the ranking of car companies based on the passenger car data of the Federation of passengers in October, 65% of car companies' sales have declined, and nearly 30% of them have dropped by more than 50%. Taking into account some car companies that have no sales or have not been counted, the situation may be even more serious. In addition, the survival situation of independent brands is not optimistic, with nearly 70% of independent brands falling into negative growth.

BAIC New Energy is one of the leading car companies in the domestic new energy industry, and its rapid decline in sales also reflects the current depressed situation of the new energy industry. BAIC's new energy sales in October were only 8601, down 69.1% from a year earlier, bringing its cumulative sales from January to October to 106900. At the same time, BAIC Blue Valley, the main body of BAIC's new energy company, announced a net loss of 270 million yuan in the first three quarters.

China's new energy vehicles have declined for four consecutive months, the decline has gradually expanded, and may fall into negative growth for the whole year. The main reasons for the obvious decline in sales of new energy vehicles in China in the second half of this year are the sharp decline in government subsidies, the weakness of the overall car market, the withdrawal of local subsidies, and the slow growth of the market for shared travel and ride-hailing, which has led to operational difficulties for new energy enterprises as a whole.

Cheetah sold only 936 cars in October, down 84.7% from a year earlier. Cheetah has more than 30 years of experience in automobile manufacturing. Due to the rapid changes in the automobile industry, the company has made serious losses in production and operation, and the production base is seriously understaffed. It has implemented measures of wage reduction and layoffs to ensure survival and tide over the difficulties.

In May this year, the internal salary adjustment of Cheetah included a salary cut of 50% for some senior executives in the headquarters, 10% for the staff of the research institute, and 30% for the staff of the production base. Due to no work arrangement waiting for work or rotation rest, the wages are calculated according to the minimum wage standard of the base area this year. According to China Business report, Cheetah had about 7000 people at the beginning of the year, and more than 1000 have left since January this year. Now it is time to carry out economic layoffs, including voluntary and negotiated layoffs of about 3000 employees.

Cheetah currently has two research institutions (Beijing Automobile Research Institute and Changsha Institute of Engineering), three key parts companies (Power Company, Zhongde Company and Fengshun Company), and four vehicle manufacturing bases (Yongzhou Company, Chuzhou Company, Changsha Company and Jingmen Company). And the company's headquarters in Changsha. Due to the decline in sales volume, some factories have fallen into a state of semi-shutdown and are facing greater operational difficulties.

Car manufacturing in Huatai and Lifan almost came to a standstill, with October sales of 50 and 6 respectively, down nearly 100 per cent. In the CCTV financial investigation, Huatai Motor's three major production bases in Rongcheng, Shandong, Tianjin and Ordos, Inner Mongolia all stopped production, dealers closed, and there were obvious cash flow problems for the company. The Chongqing Lifan automobile factory has been shut down or semi-shut down, and most of the sales networks have been shut down. at the same time, Lifan shares released its first three quarterly results showing a net loss of 2.633 billion yuan. Lifan is also caught in a debt crisis. The Chongqing municipal government has helped Lifan set up a debt committee and is actively resolving the debt crisis, Lifan said.

BAIC Yinxiang and speed car sales both fell to triple digits, down 92.2% and 85.6%, respectively. Chongqing Yinxiang Industrial Group's Speed Automobile, as well as BAIC Yinxiang, which is a shareholder, have encountered operational difficulties. BAIC Yinxiang began to have a crisis in July last year when a notice of suspension of production began, during which it was also asked for wages by employees and door-to-door protection incidents among dealers and suppliers. On August 30 this year, the Chongqing Municipal Government and BAIC signed an agreement to promote BAIC Yinxiang's strategic restructuring. BAIC Yinxiang only ushered in a glimmer of life.

Two French joint ventures, Dongfeng Renault and Changan Peugeot Citroen, fell by 62.6% and 96.1% respectively in October. The survival of French brands in China is worrying, with DS sales falling to single digits, which exist in name only. Due to successive losses, Changan Motor has put up for sale of 50 per cent stake in Peugeot Citroen and is about to withdraw from the joint venture. A spokesman for the PSA Group said, "thanks to Chongqing Changan Automobile for its support in the past eight years, the DS brand will continue to stay in China and develop vigorously and will not withdraw from China."

The decline of domestic third-and fourth-line marginal car companies, entering the moment of life and death, is a microcosm of the development of the automobile industry. Stock competition has already begun, and the process will be very cruel. Some third-and fourth-line car companies will go bankrupt or be merged.

Fu Yuwu, honorary chairman of the Society of Automotive Engineering, believes that no matter how big the Chinese market is, there is no room for hundreds of vehicle factories, and now both independent, joint venture and foreign-funded car companies are facing the market test. Market elimination is fair, which is also conducive to the merger and reorganization of China's automobile industry, the most important thing at this stage is to change. In this context, car companies without brands, core technology and capital will collapse one after another.

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