AutoBeta(AutoBeta.net)02/13 Report--

For a long time, brilliance China's profits mainly rely on the joint venture brilliance BMW, and in January this year, brilliance shareholders' special meeting approved the sale of 25% stake in brilliance BMW to BMW. This also means that BMW will seize half of brilliance's profits in the future, and more importantly, brilliance can no longer rely on BMW. In recent years, the performance of brilliance's own brand is even more worrying. Brilliance sold only 89000 cars last year, down 30% from the same period last year, among which many models of Chinese brands have entered a state of "suspension of production".

Brilliance was fully launched in the commercial vehicle market after it was listed in New York in 1992, and began to enter the passenger car market in 1997. Then it married with BMW Group in 2003 to establish brilliance BMW. Thanks to BMW's support for brilliance's own brand, brilliance became the only independent brand to appear at the Geneva Motor Show in 2007, and its three independent brands, namely, China, Huasong and Golden Cup, were also expected. However, when independent brands continued to rise in the Chinese market, brilliance began to decline.

The total sales of brilliance BMW in 2018 was 427700, up 10.92% from the same period last year, while the annual sales of brilliance Golden Cup, which was once hot in China, was only 21400, down 0.46% from the same period last year, and the annual sales of Chinese brands were only 67800, down 42.36% from the same period last year. Brilliance, another independent brand, is even more appalling. Its only model Huasong 7 sold only 1100 vehicles in 2018. Last year, sales were zero for many months in a row.

In February last year, Chinese brands sold only 4041 vehicles, down 65.0% from the same period last year. Among them, China H220, H230, H3, H330, V6 and other models sold only single digits or even zero sales in December. The best-performing Chinese V7 and V3 models sold only more than 1,000 vehicles in December.

In 2017, brilliance accumulated sales of 745700 vehicles (including commercial vehicles), down 3.7 per cent from the same period last year. Brilliance BMW accounted for more than 50 per cent of brilliance passenger car sales, up 24.65 per cent year on year to 386500.

Brilliance's revenue has been good in recent years, while brilliance's own brand has long been ugly, and its profit mainly comes from the joint venture brand brilliance BMW. Brilliance China's financial report in recent years shows that brilliance China achieved revenue of 5.305 billion yuan in 2017, an increase of 3.5% year-on-year, and net profit of 4.376 billion yuan, up 18.85% from the same period last year. Brilliance's net profit contribution increased 31% to 5.238 billion yuan from 3.998 billion yuan in 2016, which means that excluding BMW's profits, brilliance China actually lost 862 million yuan.

Brilliance China report 2018 shows that brilliance BMW achieved revenue of 3.677 billion yuan in the first half of 2018, an increase of 37.9% compared with the same period last year, while brilliance China's current revenue was 2.287 billion yuan, down 19.4% from the same period last year. Brilliance China also said the drop in earnings was mainly due to a decline in the number of non-BMW cars sold.

Brilliance has always been over-reliant on BMW. Qi Yumin, chairman of brilliance, has publicly said "market for technology" more than once, and Huasong 7 has also made extensive use of BMW technology, including chassis platform and engine. However, I am afraid everyone knows that brilliance really got the core technology.

The joint venture brand is the key to the survival of profit cows and even brilliance. Now that BMW is going to take 25% of the shares from brilliance, brilliance's performance will decline sharply. on the other hand, brilliance will lose its voice to brilliance BMW. It may become a "contract factory" for BMW, which is also a wake-up call for brilliance that it can no longer rely too much on BMW and strengthen independent research and development is the way to survive in the future.

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