AutoBeta(AutoBeta.net)01/20 Report--

On January 20, Guoxuan Hi-Tech issued a clarification announcement on the earlier media report on "Volkswagen's acquisition of 20% of battery manufacturer Guoxuan Hi-Tech", saying that the company is discussing with Volkswagen on possible future strategic cooperation in technology, products, capital and other aspects. However, so far, the two sides have not reached agreement on specific cooperation methods, contents, prices and other specific aspects, nor have they signed or reached any substantive and binding agreements, commitments or other arrangements on relevant cooperation matters; there is significant uncertainty in the above matters.

Germany's Volkswagen will acquire a 20% stake in Chinese electric carmaker Guoxuan Hi-Tech Co., Ltd. to speed up the electrification process in the Chinese market, Reuters reported on January 17, citing people familiar with the matter.

Reported that after the completion of the deal, Volkswagen will become the second largest shareholder of Guoxuan Hi-Tech, after Zhuhai Guoxuan Trading Co., Ltd., which is 25% owned by Li Mu, founder of Guoxuan Hi-Tech.

As early as 2019, Guoxuan Hi-Tech revealed that it was in talks with "first-tier international brands", but no more details were disclosed because of the confidentiality agreement signed. In August 2019, Volkswagen plans to invest in Chinese power battery manufacturers, including Guoxuan Hi-Tech.

There are many power battery manufacturers in the Chinese market, including Ningde era, BYD, Lishen and so on. Why does the public have a soft spot for Guoxuan Hi-Tech? There are mainly the following reasons:

Guoxuan Hi-Tech is the main battery supplier of Jianghuai Automobile. After the establishment of a joint venture between Jianghuai Automobile and Volkswagen, it has achieved co-line production, so Volkswagen has a close relationship with JAC. Guoxuan Hi-Tech is not only guaranteed in battery quality, but also an established enterprise of Jianghuai Automobile Cooperation, so it is still very trusting for Volkswagen.

According to the statistics of the Research Department of the Power Battery Application Branch, the total installed capacity of power batteries in China in 2019 is about 62.2 GWh, of which the installed capacity of power batteries in Ningde era is 31.71GWh, accounting for 51.01% of the total installed capacity in 2019; the installed capacity of BYD power batteries is 10.76GWh, accounting for 17.30% of the total installed capacity in 2019; and the installed capacity of Guoxuan Tech Power batteries is 3.31GWh, accounting for 5.33% of the total installed capacity in 2019.

Judging from the above data, Guoxuan Hi-Tech is inferior to BYD and even less worth mentioning compared with Ningde era, so why does Volkswagen still choose the less conspicuous Guoxuan Hi-Tech instead of BYD or Ningde era?

BYD's power batteries are mainly produced and sold by themselves, and most of them are used in their own models, and BYD has also cooperated with Toyota, although Audi also intends to cooperate with BYD, but there has been no real progress. On the other hand, Ningde era is indeed very strong, but it is because it is very strong and has cooperation with BMW, Toyota and other automobile companies. If Volkswagen chooses to cooperate with Ningde era again, then the dominance of Ningde era will become an irreversible foregone conclusion, and it will be even more difficult to have the opportunity to supply power batteries independently in the future.

According to the national enterprise credit information publicity system, Guoxuan Hi-Tech was established in 1995, the legal representative is Li Gong, and its main business is power lithium battery and power transmission and distribution equipment. So far, Guoxuan Hi-Tech has 8 manufacturing bases in China, which are located in Hefei, Lujiang, Nanjing, Qingdao, Nantong, Tangshan and other places.

According to Volkswagen's previously announced plan, it will achieve its annual sales target of 1.5 million new energy vehicles in the Chinese market by 2025, and more than half of the group's new energy vehicle sales in 2028 will come from the Chinese market. At the same time, Volkswagen Group will invest 258.2 billion yuan in the development of electric technology and charging infrastructure.

At present, Guoxuan Hi-Tech not only discusses cooperation with Volkswagen, but also cooperates with Ford Motor, General Motors and other car companies, while there are Jianghuai Automobile, Chery New Energy and other cooperation companies in China.

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