AutoBeta(AutoBeta.net)06/12 Report--

Taking advantage of the investment hunger of the local government to exchange automobile projects for financing assistance is a means used by many automobile enterprises, including BYD, Geely and other automobile enterprises. Enterprises use financing to focus on the main business, and the enterprise and the government will be a win-win situation.

If you only aim at the financing help of the town government, what you may get is trivial.

Huaoude Transmission Co., Ltd. (hereinafter referred to as "Huaoude"), a subsidiary of Huatai Company, is located in Jiangyin High-tech Industrial Development Zone.

In April and May this year, the reporter visited Warsaw twice, but the factory door was closed, there were no lights, no workers, and no equipment was in operation.

The relevant person in charge of the Jiangyin Gaokai District Management Committee said: after investigation, the company has not carried out any production since moving equipment into the factory in 2015.

Although no production work has been carried out, it has been repeatedly pledged to raise at least $1.5 billion for its parent company, Huatai Automobile Group Co., Ltd.

According to data, Huatai Automobile in Ordos and other places to obtain government resources and financing assistance, and the plant, land, equipment and other re-mortgage financing. In the first half of 2018, Huatai Motor obtained and used bank credit of up to 19.7 billion yuan by pledging the company's shares, land, equipment, etc.

A person close to Huatai Motors said that Huatai's biggest profit after investing in a plant in Ordos did not come from its main business, but from local coal mines and land gains by investing in car projects.

According to media reports, in January 2008, Tangjiahui Coal Mine, with 800 million tons of Huatai automobile reserves, was introduced into Anhui Huainan Mining Group and established Erdos Huaxing Energy Co., Ltd. Huatai Company sold the mining rights to Shanxi Puda Coal Industry Group, making a direct profit of 700 million yuan.

At the beginning of the construction of Huatai Automobile Ordos base, it was mainly to meet the order demand of Russia and other neighboring countries, but in 2015, Huatai Motor had its own contract factory in Russia. In 2017, Huatai Automobile moved its headquarters to Tianjin, and borrowed the local battery industry chain to invest heavily in Tianjin base, focusing on the development of new energy vehicles.

Not only is Huatai's investment in Ordos lower than expected, but so is Chery's promised annual production of 300000 SUV, pick-up trucks, commercial vehicles and modified vehicles. According to information from the Ordos Economic and Information Commission, Chery produced 78000 cars in Ordos in 2016, falling to 61900 in 2017, plus Huatai's 17600. In 2017, Ordos produced a total of 81000 cars (325 electric cars), with an output value of only 4.29 billion yuan.

Due to the slow progress of Huatai Automobile production Phase II project, it was reported in 2010 that the Ordos municipal government is ready to recover 6000 mu of Huatai Automobile Land. In 2011, with the outbreak of private lending and real estate crisis in Ordos, the road of industrial transformation and upgrading began to become difficult.

Since 2013, Ordos began to clean up and rectify the coal resources allocated to enterprises, but as the coal mine assets in the hands of Huatai and Chery have been transferred, they can no longer be recovered.

It was this year that Kangbashi District launched another attempt to transform and upgrade its economy. With the redevelopment of Kangbashi District, a dispute over the property rights of 6000 mu of land in the downtown area of Huatai Automobile has emerged.

Huatai Automobile has more than 6000 mu of plant in Ordos, and 3/2 of the plant is submerged in the wasteland.

Kangbashi District, a new urban area built in 2004, has become the central area of Ordos after the coal mining storm. In 2005, Huatai Automobile became the first project goal of "Coal Resources for Industry Investment" implemented by the Ordos government.

With the development of the new urban area, Huatai's production site has become the center of the new urban area. the government hopes Huatai will move out in 2017, but Huatai is unwilling, and finally the appeal courts of both sides. In the last lawsuit, Huatai raised the compensation for demolition to 2.2 billion yuan.

Over the past seven years, Huatai has gradually reduced its 2020 sales target from 2 million to 500000. Even so, it is almost impossible to reach this figure.

In fact, the profits of the automobile manufacturing industry are not high. Toyota, Honda, Volkswagen and other global profit points float between 3% and 5%. Many founders are close to financial freedom, with billions to tens of billions of personal wealth. For them, the automobile manufacturing industry can increase their personal wealth to tens of billions or even hundreds of billions.

Auto industry analysts said Huatai Motors' road in the passenger car field is getting narrower and narrower and has basically lost the ability to develop further.

Welcome to subscribe to the WeChat public account "Automotive Industry Focus" to get the first-hand insider information on the automotive industry and talk about things in the automotive circle. Welcome to break the news! WeChat ID autoWechat