AutoBeta(AutoBeta.net)08/12 Report--

On August 11, the public information on simple cases of operator concentration released by the second Department of Anti-monopoly Law Enforcement of the State Administration of Market Supervision and Administration showed that Changan Ford Motor Co., Ltd. (hereinafter referred to as "Changan Ford") intends to sign an agreement with Chongqing Changan Automobile Co., Ltd. (hereinafter referred to as "Changan Automobile") to establish a new joint venture. In the future, the joint venture plans to engage in the supply business of mainstream brand new energy passenger cars and the distribution business of Ford brand models already invested by Changan Ford. After the transaction, Changan Ford and Changan Motor respectively own 60% and 40% of the joint venture, and both sides jointly control the joint venture.

Ford is a world-class car brand and one of the few century-old car companies. In April 2001, Ford established Changan Ford Motor Co., Ltd. as a joint venture with Changan Motor Co., Ltd., which rapidly improved its product camp at the beginning of its establishment. Wing Tiger, Fox, Yibo, Mondeo, Carnival, Taurus, Forrest, Ruijie and other models came out one after another. Ten years after entering the Chinese market, Changan Ford suddenly broke out, selling 321000 vehicles in 2011. Sales have grown rapidly over the years since then, reaching a peak of 957000 in 2016.

When Changan Ford made every effort to hit the key node of "million-year sales", the broken axle appeared in a large area of Ford wing tiger model, which greatly affected the brand image of Changan Ford. Since then, Changan Ford's sales began to decline, selling 828000 vehicles for the whole of 2017. However, Changan Ford at that time was still full of expectations for the future. In December 2017, Ford and Changan signed the "deepening Strategic Partnership Framework Agreement" to strive for sales to break through the million mark in 2019. However, contrary to one's wishes, Changan Ford plummeted to 378000 vehicles and 184000 vehicles respectively from 2018 to 2019, and the goal of "million sales" became a bubble.

In 2019, Chen Anning, then chairman of Ford China, put forward the "Ford China 2.0" strategic plan. since then, Ford has actively promoted the transformation in the field of electrification and intelligence with the brand spirit of "avant-garde innovation". Under the leadership of Chen Anning, Ford China successfully promoted the localization of the Lincoln brand and quickly launched a number of domestic Lincoln brand SUV models to achieve rapid and sustained brand growth. In 2022, with the core concept of "more Ford, more China", Ford launched a new generation of Mondeo, new explorer, new Lincoln Z and other models, and successfully introduced a new generation of Ford star products, the Fmur150 Raptor. In addition, in the face of increasingly fierce competition, Ford China established Ford Electric Mach Technology Co., Ltd., launched the pure electric SUV Ford Electric Horse Mustang Mach-E model, deeply focused on the R & D and operation of intelligent electric vehicles in the Chinese market, and further supported the Ford+ program.

Unfortunately, Changan Ford's sales are falling instead of rising, and the downward trend is still expanding. In 2022, Changan Ford sold a total of 251000 vehicles, down 17.61% from a year earlier. It is understood that this sales performance is only higher than the 184000 vehicles in 2019, making Changan Ford the second lowest in 10 years. The latest sales figures show that Changan Ford totaled 119000 vehicles from January to July 2023, down 12.58 per cent from a year earlier.

According to the financial report, the operating income of Changan Ford from 2018 to 2021 is 49.754 billion yuan, 28.096 billion yuan, 49.248 billion yuan and 61.765 billion yuan respectively, and the net profit is-792 million yuan,-3.85 billion yuan, 15.75 million yuan and 2.284 billion yuan respectively. In 2022, Changan Ford has an operating income of 51.067 billion yuan and a net profit of-2.449 billion yuan.

Entering 2023, the life of Changan Ford is not easy. In mid-to-late May, a number of domestic media reported that Changan Ford cut its production capacity by one million due to a decline in sales, and its current production capacity has plummeted to 670000 vehicles. In addition, Changan Ford has also been exposed layoffs, layoffs of more than 1300 people, will be compensated in accordance with Ninten3. In response, Ford responded that it was building a more streamlined and flexible organizational structure to devote resources to core businesses with advantages.

Changan Ford fuel car market share continues to decline, electric vehicles are not surprising. Two days ago, on August 10, Ford Electric Horse officially announced that due to operational needs, this Weibo account will be shut down on August 25. At the same time, officials said that in order to ensure that future services will not be affected, they can follow Changan Ford to get more information about Ford Electric Horse.

On August 1, Changan Ford announced that it would formally take over the operation of Ford Electric Horse in the Chinese market starting from today in accordance with Ford's strategic transformation and business adjustment in the Chinese market.

In January 2021, Ford announced that the Ford Electric Horse would be produced at the Changan Ford plant and went on sale in December of the same year, with competitors targeting Tesla Model Y. However, sales of Ford electric horses in China are mediocre, delivering a total of 4860 vehicles in 2022 and only 1182 in the first half of 2023.

Weak sales in China have forced Ford to accelerate the pace of electrified transformation. In March 2022, Ford decided to split the electric vehicle and fuel vehicle business and operate independently, named Ford Model e and Ford Blue respectively, in which the electric vehicle business was led by Jim Farley, president and CEO of Ford Motor Company, but even so failed to reverse the decline of Ford electric horse sales in the Chinese market.

Miao Wei, member of the CPPCC National Committee and former minister of the Ministry of Industry and Information Technology, said in an interview with the media that the relationship between new energy vehicles and fuel vehicles is a substitute for this rise and elimination, and how to convert the production capacity of excess fuel vehicles into new energy vehicles is the main problem of automobile production capacity in China at present.

Some brands are taking the initiative or forced to make changes. Ideal Automobile invested 6 billion yuan to take over the Beijing Hyundai idle plant, which was shut down for two years. Mercedes-Benz, Volkswagen, Honda, General Motors and other brands have also begun to transform some of their production plants. As the market is constantly eroded, joint venture fuel vehicle manufacturers will only sit back and wait for death, and only by keeping up with the changes in electrification can they solve their urgent needs.

However, whether it is Ford China or Changan Ford, under the general trend of the rapid development of new energy vehicles, if there is no subversive change, it will be difficult to have a foothold in China.

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