AutoBeta(AutoBeta.net)09/07 Report--

A huge group. It used to be huge. It was once known as "China's largest car dealer" with a market value of more than 60 billion yuan. In 2018, the performance of the huge group fell precipitously, with a net profit loss of more than 6.1 billion yuan and a net profit loss of 6.8 billion yuan deducted. Today, the huge storm, selling assets, arrears of taxes and employee wages, founder equity has been frozen, and even face delisting risks.

On the evening of September 5, the huge group disclosed two announcements, the announcement shows that the court has ruled to accept the huge group reorganization application, will implement delisting risk warning. Pang Da Group shares will be delisted risk warning on September 9, the stock abbreviation will be changed to "*ST Pang Da", and the daily rise and fall of stock price will be limited to 5%; Pang Da Group shares will be suspended for one day on September 6 and resumed trading on September 9.

Once the world's largest car dealership group by market capitalisation, why did it declare bankruptcy overnight?

According to the previous announcement, on May 4,2017, Pangda Group borrowed RMB 17 million from Beijing Jidongfeng to supplement working capital for purchase. After the loan expired, Pangda Group failed to pay off its debts due to shortage of funds. Therefore, Jidong Feng Company filed an application for reorganization of the huge group to the court.

However, in fact, since 2017, the huge group has fallen into a "vicious circle" after being investigated and administratively punished by the CSRC due to credit violation. The goodwill of the company has been damaged, and the financing and borrowing channels have been seriously affected, which has affected the main business of the company and further affected the repayment of debts of the company.

According to the announcement issued by Pang Da Group on August 30, by the end of August, Pang Da Group and its subsidiaries had 25 overdue debts involving 19 financial institutions, with a total overdue amount of nearly 2.7 billion yuan.

But on the other hand, the huge group is ST, in fact, is also the epitome of the whole automobile industry, 2018, the automobile industry ushered in an inflection point, appeared the first annual sales decline in 28 years, from this year's data, the whole industry does not seem to have much improvement signs.

According to data released by SAIC Group, China's largest automobile company, sales volume in August was 486,900 vehicles, down 7.87% year-on-year; cumulative sales volume from January to August was 3.8639 million vehicles, down 14.81% year-on-year. In the first half of the year, the total operating income was 376.293 billion yuan, down 19.05% year-on-year; meanwhile, the net profit decreased by 27.49% year-on-year, down 27.51% year-on-year.

Geely automobile sales data, August cumulative sales of 101,200 vehicles, a year-on-year decrease of 19%; January to August, cumulative sales of 844,300 vehicles, a year-on-year decrease of 17%. Geely's revenue in the first half of the year was 47.558 billion yuan, down 11% from the same period last year; net profit was 4.009 billion yuan, down 40% from the same period last year.

BYD sales data, August the company's total car sales of 36,000 vehicles, the same period last year was 41,800 vehicles, a year-on-year decline of 2.83%. In the performance report of the first half year, the operating income was 62.184 billion yuan, up 14.84% year-on-year.

After twenty or thirty years of rapid growth, the automobile industry has been affected by various reasons such as the decline of macroeconomic growth rate, and the industry has ushered in an inflection point, with production and sales falling year-on-year.

However, according to the global development trend, China's car ownership per thousand people is far lower than that of developed countries. Therefore, the later development still has great potential, but the low growth rate is likely to replace the high growth rate. Mergers and consolidation within the industry, survival of the fittest can not be avoided.

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