AutoBeta(AutoBeta.net)09/28 Report--

On September 26, Jiangling Motor Co., Ltd. issued an announcement to jointly fund the establishment of Jiangling Ford Joint Venture with Ford Motor Company. The registered capital is 200 million yuan, of which Jiangling Motor contributes 102 million yuan and holds 51 per cent of the shares, while Ford contributes 98 million yuan and holds 49 per cent of the shares. From the proportion of equity distribution, Jiangling Motor has more initiative, while Ford should provide more relevant technology. According to the contents of the announcement, Jiangling Ford Joint Venture will mainly provide distribution services for Ford branded vehicles produced by Jiangling Motor, and can also be operated through wholesale sales by dealers or direct sales by end customers.

It is worth noting that after Ford bought a stake in Jiangling Motor for three times and became the second largest shareholder of Jiangling Motor, the two sides formally "held hands." According to relevant data, Ford invested in Jiangling Motor three times in 1995, 1998 and 2005, with a total investment of about 785 million yuan. Among them, Jiangling B shares were listed on the Shenzhen Stock Exchange on September 29, 1995, issuing 174 million shares, of which Ford accounted for 138.6 million shares of Jiangling Motor with US $40 million (about 333 million yuan). On November 12, 1998, Jiangling Motor B shares issued an additional 170 million shares on the Shenzhen Stock Exchange, and Ford once again acquired 120 million shares at US $54.5 million (about RMB 451 million). By the end of 1998, Ford had a total of 258.6 million shares, or 29.96 percent. In 2005, Ford acquired a total of 320000 shares of Jiangling B shares (Jiangling B) through centralized bidding on the Shenzhen Stock Exchange at 1.028 million yuan. So far, Ford has a 32% stake in Jiangling, making it the second largest shareholder in Jiangling.

Jiangling insiders said that the purpose of this cooperation is to speed up the expansion of Jiangling Ford passenger car business, accelerate the ability of channels, and promote the innovation and upgrading of customer experience, according to Jiangling Motor insiders who jointly funded the establishment of Jiangling Ford Joint Venture. The new joint venture will make full use of the superior resources of both sides, focus on customer needs, continuously launch excellent products, services and experiences that meet the unique needs of Chinese customers, and improve operational efficiency. At the same time, it will continue to enhance the brand image of the Ford brand produced by Jiangling Motor, and improve customer satisfaction and brand value.

Some industry insiders said that the establishment of a joint venture between Jiangling and Ford is the key to the rapid development of Jiangling's passenger car business. As we all know, the field of passenger cars has always been the deficiency of Jiangling Motor. Since 2006, Jiangling Motor has been planning the strategy of "simultaneous development of merchants and passengers". In 2012, it launched its first passenger car, Yusheng SUV, although the timing ran into the dividend period of domestic SUV, but Yusheng only launched S350 and S550 models. Later, due to its lack of product power, lack of awareness, slow speed of research and development and other reasons, Jiangling Motor "business and ride" strategy failed. In 2015, with the introduction of Ford brand products, SUV Road Shaker and MPV Tuiou have been listed one after another, the Jiangling passenger car sector has only slightly improved. With the launch of Laoyu in March this year, coupled with Ford's leading S, Road Shaker and Tourui, Jiangling Ford passenger cars have covered a complete product framework from hard off-road to business travel, showing that Jiangling Ford passenger cars focus on differentiated market segments and gradually establish a competitive product system.

According to relevant data, Ford's leading exports rose 200% from January to August this year compared with the same period last year, attracting the attention of consumers in overseas markets. Although sales are rising, in fact, channel construction is still a major weakness of Jiangling Ford's passenger car sector. according to official sources, only 135 "home spaces" have opened so far, and 180 are expected to be completed by the end of the year. covering most of China. For Jiangling Ford, which has a new plus-size passenger car business, the channel still needs to be further expanded.

Xiang Dongping, vice president of Jiangling Motor and general manager of Jiangling Ford passenger car Marketing Company, said that the new joint venture company will further strengthen the brand building of Jiangling Ford, speed up the development of Jiangling Ford passenger car business, and develop and enhance its channel capability. it is an important measure for Jiangling Ford to enhance customer experience and service, and it will also make Jiangling Ford more efficient, faster and other corresponding market demand. This new initiative in the passenger car business shows our determination to further accelerate the development of the passenger car business. Lin Shi, an auto analyst, said the cooperation can be seen as a hope to expand the advantages in the commercial vehicle field to the passenger vehicle field, so the two sides have expanded the scale and depth of cooperation in the passenger vehicle business.

According to Jiangling's official performance forecast for 2020, Jiangling's operating profit, total profit and net profit increased by 654.08%, 330.21% and 272.57% respectively over the same period last year. In this context, Jiangling Motor Co., Ltd. and Ford Motor Company jointly funded the establishment of Jiangling Ford Joint Venture Company, which can be said to be a strong joint venture.

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