AutoBeta(AutoBeta.net)12/31 Report--

The news of the dissolution of Changan Peugeot Citroen (Changan PSA) has been basically confirmed, both sides of the shares have sold all their shares, all operations and factories in Shenzhen have been taken over, and the eight-year history of the joint venture will eventually come to an end.

Chongqing Changan Automobile Co., Ltd. officially announced today that as of December 30, Shenzhen Qianhai Ruizhi Investment Co., Ltd. (hereinafter referred to as "Qianhai Ruizhi") submitted the registration materials and paid 831.3 million yuan for the down payment of 831.3 million yuan.

According to the announcement, Changan Automobile and Qianhai Ruizhi signed the "Equity transfer Agreement" on December 30, 2019, transferring all their 50 per cent stake in Changan PSA to Qianhai Ruizhi, with a transfer amount of 1.63 billion yuan. After the completion of this equity transfer, Changan Motor no longer holds the equity of Changan PSA, and Changan withdraws from the joint venture completely.

According to information, Shenzhen Qianhai Ruizhi Investment Co., Ltd. is 100% controlled by Baoneng Automobile Co., Ltd., and the actual controller is Yao Zhenhua. It means that Baoneng has become the catcher of Changan PSA.

At the same time, according to foreign media reports, the French car manufacturing trademark Citroen Group (PSA) has confirmed plans to sell 50 per cent of Changan PSA. If there is no accident, Baoneng is the buyer.

Wang Chao, China Communications Director of PSA Group, said that both shareholders plan to sell their shares in Changan PSA to a third party and plan for a third party to take over the Shenzhen factory. Wang Chao also said that he hopes that all employees of Changan PSA will continue to serve the company after the future new shareholders take over the company, and will choose the right time to disclose the new strategy for the development of the DS brand in China. After the change in the share structure of Changan PSA, the DS brand plans to continue to produce DS cars in the Shenzhen factory.

According to information, on November 16, 2011, Changan Automobile and Peugeot Citroen Group invested a total of 7.6 billion yuan to establish Changan Peugeot Citroen Automobile Co., Ltd. (Changan PSA). The two sides each hold 50% shares in the joint venture company, with a joint venture term of 50 years. Changan PSA has a factory in Shenzhen with an annual production capacity of 200000 vehicles, which mainly produces high-end DS models under the PSA Group.

The announcement shows that the main product series of Changan PSA are B751, B753, B754, B81, X74, X83, and the main models are DS4S, DS5LS, DS6, DS5 and DS7. The B series model has been discontinued with the approval of the board of directors, and the name of the X83 model has not yet been determined.

Due to poor sales, Changan PSA lost money one after another. According to the financial report released by Changan Automobile, Changan PSA lost 1.63 billion yuan in 2016, 1.1 billion yuan in 2017, 874 million yuan in 2018 and 2.233 billion yuan from January to September 2019. It has lost about 5.837 billion yuan in the past four years.

Data show that Changan PSA sales of the DS brand reached a peak of 27000 vehicles in 2014 and 2015. I thought DS would be able to make great progress, but DS sales began to decline sharply in 2016, with cumulative sales of only 16000 vehicles that year, 6088 in 2017 and 5478 in 2018.

In 2019, the auto industry has changed, and sales of the DS brand have hit a new low. DS sold 2030 vehicles in China from January to October in 2019, of which only 10 were sold in October, which is on the verge of delisting.

Many factors are involved in the dissolution of Changan PSA joint venture and the decline of DS brand in China. However, in the future, DS will also produce cars in the Shenzhen factory and will not withdraw from the Chinese market, and it has not been confirmed what kind of cooperation it is based on. The development process of DS brand in the Chinese market makes people feel sad.

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