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In the first half of the year, sales of traditional passenger cars were 20800, down 62.55% from the same period last year. In July, when the sixth national standard was implemented, Lifan car production and sales fell sharply again.

The production and marketing report of Lifan shares shows that the company produced only 34 traditional passenger cars in July 2019, down 99.58% from January to July last year, down 70.97% from January to July. In July, Lifan sold 678 traditional passenger cars, down 91.43% from January to July, down 66.16% from January to July.

In addition, Lifan, which started with motorcycles, has also seen a decline in motorcycle sales, with a total of 350000 Lifan motorcycles from January to July, down 12.55 per cent from the same period last year.

Lifan has gone through 27 years since its inception, has been involved in automobile manufacturing for 13 years, and is now facing a huge crisis. Lifan not only suffered a sharp decline in sales, the company also suffered a large number of lawsuits, many auto parts suppliers and financial companies sued Lifan for huge sums of money.

The cumulative amount of litigation (arbitration) involved in Lifan shares has reached 1.423 billion yuan in the past 12 months, according to an announcement issued by Lifan shares on July 26. litigation cases mainly include financial loan contracts, factoring contracts, financial leasing contracts and other disputes. Among them, Bohai International Trust, Shanghai Hongxing Macron Commercial factoring, Chongqing Senmai Auto parts and other companies are the "creditors" of Lifan shares.

Wanan Technology, a parts supplier to Lifan, announced on July 30 that it had sued Lifan shares for payment of about 6.0757 million yuan from its subsidiaries Chongqing Lifan passenger car Co., Ltd., and Lifan Automobile Beibei Branch.

Wanan Technology said that since 2007, Lifan passenger cars, Lifan passenger cars Beibei Branch continued to purchase brakes, clutch pumps, vacuum booster and other auto parts from Zhuji Wanbao, a wholly owned subsidiary of Wanan Technology. Since last year, Lifan passenger cars, Lifan passenger cars Beibei branch failed to pay on schedule, the company's default behavior has caused Zhuji Wanbao losses. As of the prosecution of Japanese sail passenger car, Lifan passenger car Beibei branch owed a total of 6.0757 million yuan, still not fully paid.

Being asked for a huge sum of $1.4 billion could further overwhelm Lifan, as Lifan has already lost money on its operation. According to the performance report, Lifan achieved a net profit of 253 million yuan in 2018, mainly by selling assets, while the net profit after deducting non-recurrent profit and loss was as high as 2.149 billion yuan. According to the financial report for the first quarter of 2019, Lifan's operating income in the first quarter was about 2.25 billion yuan, down 31.07% from the same period last year. The net profit of shareholders belonging to listed companies was about-97.2 million yuan, down 257.56% from the same period last year.

In addition to debts, Lifan shares also used the raised funds a total of 449 million yuan three times in July 2018, December 2018 and April 2019 to temporarily replenish the working capital, all of which have not yet been repaid. The first sum of 379 million yuan is due on July 5, 2019. Lifan said that the company's current capital liquidity is tight, production and operation also need a certain amount of liquidity, unable to raise large amounts of funds in a short period of time. In addition, it is difficult for the company to raise new financing, so the company is unable to return the above 379 million yuan to raise funds in the short term.

Lifan almost fell into a state of suspension, sales did not improve, the company's transformation is difficult, and there are financial problems. Lifan as an independent old car company, come to the present situation, can not help but let people saddened.

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