AutoBeta(AutoBeta.net)06/26 Report--

According to a notice issued by Lifan shares, about 604 million shares held by the controlling shareholder Chongqing Lifan Holdings Limited (referred to as "Lifan Holdings") have been frozen, accounting for 97.28% of the company's shares held by Lifan Holdings. It accounts for 45.96% of the total share capital of Lifan shares, with a freeze period of 3 years.

After the collapse in sales and losses in performance, Lifan is now in deep trouble. According to the May production and sales KuaiBao announcement released by Lifan, production of traditional passenger cars fell 87 per cent in May from a year earlier to 1066, with a cumulative total of 16335 from January to May, down 62 per cent from a year earlier. In terms of sales, 1024 vehicles were actually sold in May, down 86.6% from a year earlier, while 19683 vehicles were sold in the previous month, down 57% from a year earlier. Meanwhile, Lifan sold 10200 vehicles in 2018, the lowest in nearly four years.

The collapse in sales caused a huge reduction in receivables, causing Lifan's cash flow to be tight for a time. Data show that Lifan has pledged equity, land sales and qualifications in order to save funds. Lifan issued an announcement in February 2018, selling two assets, namely, the subsidiary Chongqing Lifan Automobile Co., Ltd. transferred to Cha Hejia at a price of 650 million yuan; in addition, Lifan also sold the production base of the original 150000 passenger car project to Chongqing Liangjiang New area Land Reserve renovation Center for about 3.315 billion yuan, thus obtaining corresponding funds. Through the "sale of household property" is the main way for Lifan to achieve profits.

The decline in sales of Lifan is inseparable from the low coverage of dealers. At present, Lifan has only 129 dealers nationwide, while there are only 2-3 dealers in many provinces and cities, which can not achieve comprehensive coverage for consumers.

As early as May this year, more than 30 Lifan dealers protected their rights at Lifan Automobile headquarters in Chongqing, but after consultations with Lifan Group, the two sides did not reach an agreement and broke up in discord. It is understood that Lifan sold its cars to some automobile resources companies and auto trade stores at a low price of 4-50% discount at the market guidance price, thus disrupting and impacting the price system of 4S stores. These dealers, who have no new car replenishment for a long time and have almost no car to sell, get higher purchase prices from manufacturers than these non-4S store channels.

The Lifan car factory has been shut down since July last year, and the lack of competitive new products, coupled with low brand recognition, has made it almost difficult for Lifan to open up in first-and second-tier cities. With the downturn of the automobile market environment, a number of Lifan dealers have chosen to withdraw from the net.

Lifan was founded in 1997, initially mainly engaged in the production and sales of motorcycles, entered the passenger car industry in 2006, while involved in the general gasoline engine business.

However, in addition to the recent performance of Lifan Motor, in addition to the decline in stock prices in the capital market, the production and sales announcement of Lifan shares on the evening of June 14 also exposed the "frustrations" of Lifan Motor sales in the terminal market.

Whether it is traditional fuel vehicles or new energy vehicles, Lifan cars have been reduced to marginal car companies.

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