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A number of auto executives have predicted that 50% of China's autonomous auto companies will fail in the future, while Chang 'an Automobile President Zhu Huarong believes that there will be only five or six Chinese auto companies left. During the Guangzhou Auto Show, Zhu Huarong said that he had predicted three years ago that "it is not news that enterprises will shut down and turn around within three to five years", and that more enterprises will shut down and turn around in the next three years, and finally Chinese automobile enterprises will "only have five or six left".

Entering 2019, China's automobile sales continued to decline, the industry environment continued to deteriorate, automobile enterprises experienced successive operating difficulties, performance declined to losses, news of production suspension and arrears emerged one after another, some enterprises sold land and sold qualifications, and even entered a difficult time of merger and reorganization. Zhu Huarong, president of Changan Automobile, made an optimistic evaluation of the future trend of Chinese automobile enterprises, highlighting the current situation of difficult survival of Chinese automobile enterprises.

According to the statistics of China Automobile Association, China's automobile production and sales volume has declined year-on-year for 16 consecutive months, and automobile sales volume from January to October 2019 decreased by 9.7% year-on-year. The production and sales of new energy vehicles, which are considered by Chinese automobile enterprises to achieve "curve overtaking", have also declined for four consecutive months, and may fall into negative growth throughout the year.

At the same time, the market share of Chinese brand passenger cars continues to decline, and the market share has fallen below the 40% red line. According to the data of China Automobile Association, 6.672 million passenger cars were sold in China from January to October 2019, down 17.5% year-on-year, accounting for 38.9% of total passenger car sales, down 3.1 percentage points from the same period last year. Changes in the market and consumption environment, as well as joint venture brand prices, have squeezed the survival space of Chinese brands.

Among them, Chinese brands have occupied an advantage in SUV field after years of development, and their market share has also declined rapidly. 1-10 Chinese brand SUV sales in March 3.897 million units, down 17.3% year-on-year, accounting for 52.5% of total SUV sales, down 5.7 percentage points from the same period last year, than cars (share down 1%) and MPV (share down 1.5%) decline is greater.

At present, there are more than 100 automobile enterprises in China, including FAW, Dongfeng, Chang 'an, Beiqi, SAIC, GAC, Geely, Great Wall, BYD, Chery, Zhongtai, Jianghuai, Brilliance, Jiangling, Lifan, Hippocampus, Guanzhi, Baowo and other traditional automobile enterprises, as well as NIO, Weima, Xiaopeng, Yundu and other new forces to build cars. Before China's cars were higher, it was an incremental market, but now it is a stock market, or even a shrinking market. In the battle of life and death knockout, perhaps the first to fall will be some marginal car enterprises.

Fu Yuwu, honorary chairman of the Automotive Engineering Society, believes that "the Chinese market is too big to accommodate hundreds of automakers, and now both independent, joint ventures and foreign-funded automakers are facing market tests." 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 change. In this context, there is no brand, core technology, capital car enterprises, will fall one after another."

According to the sales volume statistics of the association, 58 Chinese automobile enterprises have sales volume, but the survival status quo is not optimistic, nearly 76% of the automobile enterprises fall into negative growth, and nearly 40% of the enterprises fall by more than half.

(Table: Daily Cars; Data: Multimodal Associations)

Entering 2019, news of business difficulties in Chinese automobile enterprises frequently broke out. Junma automobile brand almost shut down, parent company Zhongtai automobile under the leadership of the government, got 3 billion yuan rescue funds from local banks, suspended difficulties. Lifan automobile production base was basically shut down completely. In October, only 452 vehicles were sold, including only 29 fuel vehicles. Meanwhile, Lifan performance report showed a loss of 2.6 billion yuan in the first three quarters of 2019. Haima car losses intensified, forced to sell houses to renew their lives. Cheetah Auto's multiple production bases are under-employed and layoffs and pay cuts are implemented. Huatai Automobile's three major production bases in Rongcheng, Shandong, Tianjin and Ordos, Inner Mongolia, all stopped production and dealers closed. There is uncertainty whether Beiqi Yinxiang and speed comparison vehicles can overcome difficulties after shutdown.

This is still happening in the automotive industry. According to the sales volume, the enterprises with sales volume of less than 5,000 vehicles since 2019 include Guihang Lotus, Huatai Automobile, FAW Haima, Tianjin FAW, Zhidou Electric, Kangdi Electric, Xinte Automobile, etc.

The market decline will continue, the auto industry has not yet reached the bottom, for Chinese car companies is a moment of life and death, including Geely CEO An Conghui, a number of executives, have predicted that 50% of car companies fall. Tan Benhong, executive vice president of Changan Automobile, said,"China's automobile industry has entered a comprehensive elimination period, and the stronger the strong, the greater the pressure on the weak." The survival of the fittest is more obvious, and 50% of Chinese car brands will soon cease to exist." In addition, Geely Automobile Group President and CEO An Conghui thinks: "After 50% of China's automobile industry goes bankrupt, the remaining 50% of the competition may be the most intense." Zhu Huarong believes that there will be only five or six Chinese car companies left.

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