AutoBeta(AutoBeta.net)09/01 Report--

A number of 4S stores owned by car dealer group Zhengtong Motor were exposed to be unable to deliver on schedule, leading to frequent incidents of consumer rights protection. 4S stores said the reasons for the delay were "group financial problems" and "non-redemption certificates". Zhengtong Motor's latest financial report shows that the group has changed from profit to loss.

A few days ago, Zhengtong Motor released first-half results, the company realized income of 9.24 billion yuan, down 47.0% from the same period last year; shareholders should share a loss of 1.365 billion yuan, compared with a net profit of 470 million yuan in the same period last year; and a basic loss of 55.7 cents per share.

The decline in revenue was due to a drop in new car sales, the announcement said. In the first half of the year, Zhengtong Motor sold a total of 21500 new cars, down 58.6% from the same period last year, of which 17500 were sold by luxury and ultra-luxury brands, down 57.0% from the same period last year. In the first half of 2020, the group achieved a gross profit margin of 4.1% on new car sales, a decrease of 0.6% compared with the same period last year, and after-sales revenue of 1.77 billion yuan, down 27.3% from the same period last year.

Zhengtong Motors, a 4S store group specializing in luxury brands in China, was listed on the Hong Kong Stock Exchange in 2010 and is the first luxury car dealer group to be listed in Hong Kong, China. Zhengtong Motor once staged "Snake Swallow Elephant" in 2011, buying Shenzhen Sinochem Southern Investment Group Co., Ltd., which is twice its size for 5.5 billion yuan, and is famous in the industry.

In 2020, a number of Zhengtong's 4S stores were exposed that they could not deliver their vehicles on schedule, and consumer complaints about rights protection occurred frequently, all of which were said to be related to the capital problems of the group head office, and the vehicle certificate could not be redeemed in the bank. The consumer pick-up date has been extended many times.

In late August, a number of consumers pulled up banners in front of the BMW 4S store in Foshan to plead for claims that the delivery of the BMW they bought had been delayed. Foshan Baoyun BMW Automobile sales and Service Co., Ltd. belongs to Zhengtong Automobile Service Co., Ltd.

A number of consumers have failed to mention the new car bought at the Volvo 4S store in the south of Guangdong Automotive, thepaper.cn reported on Aug. 26. A person in charge of Sinochem's southern 4S store responded that 23 cars in the 4S store could not be delivered on time due to financial problems in the group company. After this situation, the 4S store actively communicated with all car owners. At present, these vehicles are parked in front of the 4S store, because the relevant procedures are not complete, can not be delivered. He also promised that 4S stores are also trying their best to solve the problem, and the group's funds will come down soon to ensure that car owners can pick up their cars by September 10.

In its first-half results, Zhengtong Motors revealed that it had opened a total of 127 4S stores and closed eight unprofitable 4S stores in the first half of the year. Zhengtong's operations include Porsche, Mercedes-Benz, BMW, Audi, Jaguar Land Rover, Volvo, Cadillac, Infiniti.

The group also operates dealerships for mid-market brands such as FAW-Volkswagen, Buick, Nissan, Toyota, Honda and Hyundai. Zhengtong also said that the Group has been authorized to build nine 4S stores, including 4S stores of luxury brands such as Porsche, Mercedes-Benz, BMW and Audi, as well as profitable maintenance centers.

According to media reports, Zhengtong Motor issued US $173 million of bonds at an annual interest rate of 12% in 2020 and discounted 15.5% of its placing shares on July 16, raising HK $267 million, totaling US $440 million. In July, Zhengtong Motor was revealed to have defaulted on an installment loan of about $100 million. On July 22, Zhengtong Motor announced that it would repay 30% of the principal and interest of the loan in two installments, and the installment loan would be extended to January 2021. On July 31, Zhengtong announced again that it was solving its financial problems by selling its stake.

Welcome to subscribe to the WeChat public account "Automotive Industry Focus" to get the first-hand insider information on the automotive industry and talk about things in the automotive circle. Welcome to break the news! WeChat ID autoWechat