AutoBeta(AutoBeta.net)03/25 Report--

GAC Fick, whose sales continued to decline, borrowed 1 billion yuan to replenish its cash flow. GAC GROUP issued an announcement agreeing to provide a 500 million yuan entrusted loan to Guangzhou Auto Fick Automobile Co., Ltd., a joint venture company, through its subsidiary Guangzhou Automobile Group Finance Co., Ltd., with a term of one year, and the interest rate is the one-year LPR rate announced by the people's Bank of China on the lending date.

According to the share ratio of the shareholders of both sides to provide loans, GAC Fick can receive a total of 1 billion yuan in loan funds. GAC insiders said that the funds were used to supplement the cash flow of GAC Fick's daily production and operation.

Sales of Guangzhou Auto Fick, which is in decline in China, fell below 100000 last year. According to sales data, GAC Fick sold 180000 units in 2016 and 222000 in 2017, an all-time high. In 2018, Guangzhou Auto Fick began to slow down sharply, with annual sales of 125000 vehicles, down 39% from the same period last year. At the same time, with the outbreak of quality problems, the most famous Jeep 2.4L model suffered frequent user complaints about engine oil burning. Under the continuous cold winter of the domestic car market in 2019, the life of GAC Fick is even more difficult, with annual sales of only 73907 vehicles, down 41% from the same period last year and falling below 100000.

In 2020, Guangzhou Auto Fick suffered greater losses due to the impact of COVID-19 's epidemic. From January to February this year, GAC Fick's cumulative sales were 2380 vehicles, down 83 per cent from a year earlier.

Guangzhou Auto Fick's sales have declined one after another, largely due to quality problems and declining brand reputation. For example, the frequent oil-burning incidents of the Jeep brand models on CCTV in 2018 have not been resolved for a long time to complain about the quality of the car owners. Finally, under the pressure of public opinion, GAC Fick decided to issue an announcement to recall 143900 models equipped with 2.4L engines, exceeding the total sales of GAC Fick in 2018. On this quality problem, which has been perplexing for a long time, it also makes many car owners feel cold to the manufacturers.

In addition, frequent recalls have also damaged the brand's reputation. In January, Guangzhou Auto Fick decided to recall 26382 cars, involving the 2019 Compass and Liberty Man equipped with 1.3T engines. The reason is that the waterproof performance of the internal excitation switch of the starter is insufficient, and the water inlet corrosion of the starter excitation switch may occur under specific working conditions, resulting in the functional failure of the starter and the failure of the vehicle to start. in extreme cases, it may cause internal short circuit and wire harness overheating of the starter, increasing the risk of engine cabin fire. A few months ago, Compass, equipped with a 1.3T engine, also conducted a defect recall, which may cause the engine to stall due to software strategy problems in the power system control module.

At present, Guangzhou Auto Fick's Jeep brand has four domestic models, including Liberty Man, Compass, Free Light and Big Commander. The company has two vehicle factories in Changsha and Guangzhou, as well as an engine factory, with an overall design capacity of 328000 vehicles and an engine capacity of 488000 units.

In May last year, Guangzhou Auto Fick and Guangzhou Auto Fick sales company carried out a "merger", mainly including organizational structure and personnel, to achieve the integration of production and marketing. The newly formed "integrated joint venture" integrates the functions of the two companies, with an executive appointed by each shareholder as president and executive vice president.

Mak Mingkai, CEO of Fick Group, said that the new organization can better respond to the needs of the Chinese market and accelerate the goal of improving quality, reducing costs and providing excellent products to the market.

At this point, Guangzhou Auto Fick is still on the decline, what needs to be changed is the user's word-of-mouth and product quality.

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