AutoBeta(AutoBeta.net)10/25 Report--

According to media reports, car-building new power company Edison Motors will buy Ssangyong for about 223 million euros, and the agreement between Ssangyong and Edison Motors will be finalised as soon as late November. According to previous reports, Ssangyong filed for bankruptcy restructuring with the Seoul court as early as the end of 2020 and has been looking for potential acquirers ever since.

The Seoul bankruptcy court said the consortium led by Edison Motors was currently the only bidder for Ssangyong, making it a preferred bidder. The court said another consortium led by Electrical Life Business and Technology, an electric car company that competes with Edison Motors, was excluded from the bidding list because it could not prove it had sufficient funds for the acquisition. It is understood that Ssangyong is currently in court custody, and the sale requires court approval. A memorandum of understanding with Edison Motors is expected to be signed around the end of October and a final agreement will be signed at the end of November.

According to the data, Edison Motors was founded in 2015 to produce electric commercial vehicles, including buses and trucks. Edison Motors is interested in Ssangyong because it intends to enter the passenger car market and can mass produce electric cars at Ssangyong's plant in Pyeongtaek, South Korea. Kang Young-kwon, chief executive of Edison Motors, has previously said: "I want to build Ssangyong into an electric car brand that can compete with Tesla, Volkswagen, General Motors and other global auto companies."

Ssangyong Automobile is a well-known automobile manufacturer in South Korea, founded in 1954, is a famous automobile manufacturer mainly manufacturing four-wheel drive cars, and producing large passenger cars, special vehicles, automobile engines and spare parts, its main model is SUV, exported to more than 60 countries and regions, including Europe, Asia, Central and South America and Africa.

Ssangyong Motors entered the Chinese market in 2001 and was one of the first overseas brands to enter the Chinese market, but its multi-purpose four-wheel drive off-road model Rexton sold in the Chinese market sells for up to 480000 yuan. In 2004, SAIC bought a 49% stake in Ssangyong for $500m. Due to poor management and the impact of the economic crisis in 2008, Ssangyong filed for bankruptcy protection in 2009. SAIC wanted to buy Ssangyong in one fell swoop, but it was opposed by South Korean trade unions and ended in failure. Ssangyong was eventually acquired by Indian car giant Mahindra&Mahindra, thanks to the popularity of Tivoli models. Ssangyong made a net profit of 58 billion won in 2016.

Since then, however, Ssangyong has been losing money. Ssangyong's net loss rose from 66 billion won in 2017 to 62 billion won in 2018 and widened to 341 billion won in 2019. In 2020, due to the impact of the superimposed epidemic, Ssangyong's operating loss has reached 215.8 billion won, close to its total loss in 2019. After 15 consecutive quarters of losses, Ma Hengda's directors refused to inject any new investment into Ssangyong and were willing to give up control of the Ssangyong car and have been looking for a suitable buyer. Now, Ssangyong Motor has once again suffered a bankruptcy crisis, and the car-building new power company Edison Motors will buy Ssangyong Motor for about 223 million euros.

Some people in the industry believe that the failure of Ssangyong is not only the lack of core technology, but also the lack of comprehensive competitiveness in many aspects. In fact, Ssangyong's performance in the Korean market is quite good, but except for Hyundai Kia, other Korean car brands do not seem to have much sense of existence, and the lack of product and brand competitiveness is the fundamental reason that restricts its development. this is also the root cause of Ssangyong's failure.

In the shrinking environment of the global automobile market, it is nothing new for traditional car brands to be acquired by new car-building brands. Not long ago, ideal Automobile Beijing Green Intelligent Factory officially started construction in Shunyi District, Beijing. It is understood that the ideal Automobile Beijing Green Intelligent Factory is to transform the existing factory area of the former Beijing Hyundai factory, with a total investment of 6 billion yuan, covering an area of 786mu and a construction area of 270000 square meters. It is expected to be completed and put into production in September 2023. As a well-known South Korean car brand, Hyundai Motor has not developed smoothly in China, with cumulative sales of 716000 vehicles in 2019, falling to 502000 in 2020 under the influence of the epidemic, and 203000 in the first half of 2021, with an annual target completion rate of 36.25% for 560000 vehicles. As a car-building brand that has only been developed for a few years, it is ironic that Beijing Hyundai's first factory has been taken over by ideal cars. after all, Beijing Hyundai, once a joint venture brand that sells millions of vehicles a year, is now so dismal that it has given way to electric car brands.

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