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Recently, Zhongtai Motors disclosed its third-quarter results show that operating income in the first three quarters of 2021 was 610 million yuan, down 37.65 percent from the same period last year; net loss was 990 million, up 36.65 percent over the same period last year; operating income in the third quarter of 2021 was 230 million yuan, up 7.64 percent from the same period last year; and a net loss of 240 million yuan was realized, up 55.08 percent over the same period last year. It is understood that in the third quarter, the owner's equity of Zhongtai Automobile belonging to the shareholders of listed companies is-5.413 billion yuan, that is, it is insolvent.

It is worth noting that although Zhongtai is in deep crisis, its performance in the capital market is extremely strong. Zhongtai Motor closed at 9.07 yuan as of Oct. 29, up more than 565 percent from 1.16 yuan at the beginning of the year, with a total market capitalization of 18.4 billion yuan.

On October 8, Zhongtai announced that on September 30, 2021, Jiangsu Shenshang holding Group Co., Ltd. was finally selected as the restructuring investor according to the voting results of the review. On the same day, the company and its managers signed the "Zhongtai Automobile Co., Ltd. Restructuring Investment Agreement" with Jiangsu Shenzhen Merchants, with a restructuring investment of 2 billion yuan. The recruitment of restructuring investors need to be approved by the court after Zhongtai Automobile's restructuring plan (draft) was decided by the court before it was finally confirmed as the official restructuring investor of Zhongtai Automobile. On October 27th, Zhongtai issued another announcement that 2 billion yuan of restructuring funds have all been in place.

Relevant data show that the legal representative of Jiangsu Shenzhen Merchants is Huang Jihong, which is a large private enterprise jointly invested by 79 key private enterprises in Shenzhen, mainly engaged in large-scale project investment and high-tech development and production. mainly to expand the financial industry and real estate development. It successfully managed the restructuring of the huge group in 2019 and became the intended investor in the restructuring of the huge group. Later, Pang Qinghua, then chairman of the giant group, relinquished his stake from the giant, and Huang Jihong became the actual controller of the huge group.

As for Zhongtai Automobile, it not only has the dual production qualification of "traditional fuel vehicles + new energy vehicles", but also has a production base in Zhejiang, Hunan, Hubei, Shandong, Chongqing and other places, with its products covering sedan, SUV, MPV and new energy vehicle market segments. As one of the independent car companies, it is famous for launching a number of models in 2016, such as the T600 sports version, the SR9, the New Damai X5 and so on. In particular, SR9 has become Zhongtai's "star" product after its launch. Thanks to this, Zhongtai Automobile's cumulative sales reached 333100 vehicles in 2016, an increase of 50% over the same period last year, which is also the peak of Zhongtai Automobile sales. However, the good times did not last long, due to the subsequent outbreak of quality problems, word of mouth plummeted, Zhongtai car sales have been declining, after a decline in 2017, sales fell to 154800 in 2018 and only 116600 in 2019. In 2020, Zhongtai Automobile production and operation business almost stagnated, many of its subsidiaries and parent companies were liquidated.

For the purpose of participating in Zhongtai restructuring, Jiangsu Shenshang made it clear that it is to obtain the qualification of automobile production, so as to produce and sell the whole vehicle. The relevant person in charge said that the future Zhongtai Automobile brand will still exist, will not be limited to the production of cars. In the field of new energy vehicles, Jiangsu Shenzhen Merchants will have a relatively large investment to import more car brands for the giant, and will also import more new technologies and develop more new products for Zhongtai Automobile.

From the point of view of the industry, Shenzhen Merchants Holdings has taken over a large number of companies or Zhongtai, in fact, it also intends to use these companies to gain profits in the capital market, because both huge and Zhongtai are A-share listed companies, through the revitalization of enterprises later, to attract investors to enter the bureau, in order to achieve the purpose of obtaining funds.

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