AutoBeta(AutoBeta.net)06/11 Report--

The net exposed: the car dealer group, a huge group, has submitted an application for "bankruptcy reorganization" on May 17 this year and is currently waiting for court approval. Subsequently, Pang Qinghua (chairman of the giant group) also confirmed this in an interview with the media, but at the same time, Pang Qinghua also stressed that the 'bankruptcy reorganization' was initiated by Jidongfeng Company, a creditor of the giant group (Beijing Jidongfeng Automobile sales and Service Co., Ltd.) and was not applied by the giant group on its own initiative.

On May 14th the giant group issued an announcement called "indicative announcement on the application for restructuring by creditors". According to the announcement, the giant group failed to pay off its debts due to an one-year loan of 17 million yuan from Jidong Feng Company on May 4, 2017. Therefore, Jidong Feng Company applied to the court for bankruptcy reorganization of the huge group on the grounds that the huge group was unable to repay its debts.

In response to the announcement, Pang Qinghua denied that he was unable to repay the debt, saying: "it is not because of huge insolvency that bankruptcy restructuring is filed, the fundamental reason is that large groups have liquidity problems in repaying bank debts."

At present, financial institutions that have debt relations with large groups in China have stopped collecting debt from huge groups. Once the court approves the bankruptcy reorganization application, the large group will implement the measure of "operating system debt-to-equity swap", thereby reducing the debt pressure. In fact, the huge fall has been suspected for a long time, and since the middle of 18 years, the negative news about the huge groups seems to be increasing day by day. During this period, there have been continuous reports of business problems such as the closure of its distribution stores, layoffs, salary cuts and so on.

Data show that from 2011 to 2017, the annual net profit of the giant group was only 150 million yuan. Last year, the revenue of the huge group was 42.034 billion yuan, down 40.37% from the same period last year; the net profit of the equity side in the market was "negative 6.155 billion yuan", down 3003.23% from the same period last year.

In the list of China's top 100 auto dealership groups released a few days ago, the giant group, which has been at the top for many years, only ranked ninth, with revenue falling by more than 28 billion yuan. Up to now, the former king of domestic car dealers can only rely on the protection and support of the government.

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