·Restructuring of the steel industry for the automobile industry to set an example for Dongfeng FAW to merge with the trend

Not long ago, the "Guiding Opinions on Promoting the Structural Adjustment and Restructuring of Central Enterprises" issued by the General Office of the State Council (hereinafter referred to as "Guiding Opinions") clearly pointed out that the automobile industry, as a key industry of the national economy, is included in the encouragement of restructuring. Among the areas of integration.

Recall that in May last year, the former FAW Group Chairman Yu Yanfeng returned to the automobile industry as the deputy secretary of the provincial party committee, and served as the chairman of Dongfeng Motor Co., Ltd., and Xu Ping, former chairman of Dongfeng Motor Co., transferred to FAW Group as chairman, FAW Another kind of intermodulation "Headman" with Dongfeng has already caused the industry to speculate on the restructuring of Dongfeng and FAW; I think that in June this year, there will be media reports that Xu Liuping, chairman of Changan Automobile (000625), may be the general manager of Shanghai FAW Group. People in the industry are more happy to see the combination of "Yan Yanfeng and Xu Liuping" in charge of Dongfeng FAW.

Will FAW and Dongfeng restructure? The author has received news from a person close to FAW Group that the restructuring between FAW and Dongfeng does have something to do, but the preparation time is very long and the timing is very important. Is it necessary for the two companies to restructure?

This is not the case, the domestic steel industry has set an example for the automotive industry. The second-ranked Baosteel Group and the sixth-ranked Wuhan Iron and Steel Group formally merged half a month ago, becoming the world's second largest and China's largest steel group, China Bao. Wu Steel Group. The merger of Baosteel and Wuhan Iron and Steel has achieved the centrally required “slimming and healthy body to improve quality and efficiency” and set a demonstration effect for industry restructuring.

Let us look at the status of FAW and Dongfeng in the automotive industry. Dongfeng Motor ranked second and FAW Group ranked third. Just like Baosteel's steaming day and WISCO rivers and rivers, the situation is the same. Dongfeng Motor has been on the rise in recent years, ranking 81st in the “Top 500 in the World” in 2016, an increase of 28 from last year; FAW Group’s position has declined in recent years, and it will be surpassed by SAIC and Dongfeng in sales. Behind Changan Automobile, FAW Group ranked 130th in the “World Top 500 in 2016”, down 23 from last year.

In the auto industry, which still belongs to the sunrise industry, it is difficult for FAW Group to retreat if it does not advance. According to the retirement age of the 63-year-old cadre at the national vice-ministerial level, Xu Feng, 59, is the last stop in the FAW. What is Xu Ping’s mission to FAW?

For the FAW Group, which has experienced corruption in the collapse mode, if it is to establish a new atmosphere, a new look, and revitalize the glory, perhaps a younger head is more appropriate. At present, Xuping has been in the FAW Group for more than one and a half years, but the entire FAW Group has not been shocked. It is the original "the two companies listed in the FAW Group to be resolved in 2016. The problem of horizontal competition has been postponed for another three years." It is boiling, and this is also highly coincident with Xu Ping’s long term. Even if Xu Ping solved the competition in the same industry three years later, the realization of the overall listing of FAW Group only solved the tasks left by the predecessors. Perhaps it was only during the reign of Xu Ping that the reorganization of FAW and Dongfeng was the most perfect moment of career. .

According to the "Guidance Opinion", "the automobile industry is included in the field of encouraging reorganization and integration" can be seen from the country's urgent need for integration. It can also be seen that the country is determined to become bigger and stronger. Let’s take a look at “2016 World Top 500”. Only Chinese auto companies are listed in the top 50 of the world’s top 500 companies, and the top 50 foreign auto companies Volkswagen, Toyota, Daimler Compared with GM, Ford and Honda, the difference in scale is obvious. In particular, the top 50 foreign car companies sell cars to the world, and the vast majority of Chinese car companies are sold domestically, and the so-called scale sales are mainly contributed by joint ventures.

Taking FAW Group as an example, FAW Group, as the only one among the world's 500 companies, has dropped its ranking of Chinese automakers. In the first half of this year, FAW-Volkswagen and FAW Toyota both accounted for more than 80% of FAW Group's total sales in the first half of the year. FAW Car (000800, shares) sales in the first half of this year was 77,499 units, compared with the sales of 125,309 units in the same period last year, down 38% year-on-year, the company's loss limit reached 850 million yuan.

Although the sales volume of Dongfeng Motor depends on the joint venture, it will not be better than FAW Group. However, the sales volume of Dongfeng Auto's own brand has been on the rise in recent years. Once Dongfeng Motor with operating income of US$82.617 billion and FAW Group with operating income of US$62.852 billion are reorganized, New Auto Group will surpass operating income of US$106.684 billion. SAIC Group will become the world's sixth largest and China's largest automobile group. Strength and R&D strength will undoubtedly play a significant role in improving the development of independent brands.

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