Changan automobile speed up to break away: the third innovation and entrepreneurship has a long way to go

 Changan automobile speed up to break away: the third innovation and entrepreneurship has a long way to go

According to public data, in the first three quarters of 2019, Changan Peugeot Citroen achieved a net profit of - 2.23 billion yuan, with a serious loss.

In the view of securities companies, after the divestiture of loss assets, Changan Automobile will significantly improve the performance of listed companies; meanwhile, with the gradual recovery of Changan Automobile independent plate and Changan Ford since the second half of 2019, Changan Automobile will usher in the turning point of operation in 2020.

In recent two years, Changan automobile has accelerated the disconnection of excess capacity and loss plates through a series of actions to promote business focus, from the purchase of shares held by Suzuki, a joint venture company, in 2018, to the abandonment of the joint venture brand Changan Peugeot Citroen, to the introduction of new strategic investors by Changan new energy.

In 2019, Changan is a year of hard work to achieve a turning point. In 2020, although there are still challenges, it is a more confident year for Changan. The goal of Changan automobile is to win the market. On December 30, 2019, Zhang Baolin, chairman of Changan Automobile, said in an interview with reporters.

At this time, nearly two years have passed since Changan Automobile put forward the third innovation and entrepreneurship plan in April 2018. Combing the market performance of Changan Automobile in the past two years is mixed.

On the one hand, with the improvement of CS Series SUV model market segmentation, the independent plate of Changan automobile has gradually improved since the fourth quarter of 2019. Data shows that from January to November 2019, the overall sales volume of Changan Automobile reached 1.5662 million, and the number of Changan brand Chinese cars exceeded 1.1 million, including 715400 Chinese brand passenger cars; from August to November, the company achieved a month on month growth for four consecutive months; in October, the month on month growth was 6.6%, and in November, the month on month growth was 8.9%, outperforming the market in the fourth quarter.

On the other hand, Changan Ford and Changan Mazda, the joint-venture brands of Changan, are still not out of the trough; at the same time, the short board of the car sector and the lessons left behind of new energy vehicles are also difficult to make up in a short time.

However, since the second half of 2018, the negative growth of vehicle market in the past two years and many uncertainties facing the future make the joint venture stall and unbalanced development of Changan Automobile face new challenges and transformation pains.

In the view of the insiders, problems such as excessive dependence on joint ventures, lack of competitiveness of independent products, low brand premium ability, and short board of product quality are the root causes of the problems of Changan Automobile in recent years.

Changan executives, led by Zhang Baolin, have long recognized the problem. In April 2018, Zhang Baolin put forward the third innovation and entrepreneurship plan of time knocks you out and has nothing to do with you, officially opening the road of Changan transformation from a traditional automobile manufacturing enterprise to an intelligent travel technology company.

Among them, intellectualization and new energy are two crucial hands, for which Changan has invested a lot of resources.

In May 2018, Changan Automobile established a wholly-owned subsidiary, Changan new energy, as an important part of its Shangri-La plan. According to the plan, by 2020, Changan will complete the construction of three new energy special platforms, and stop selling traditional fuel vehicles in 2025.

However, as of October 31, 2019, Changan new energy has been in a loss state. Public data shows that in 2018, the company lost 227 million yuan, and in the first ten months of 2019, the net loss was 530 million yuan, but the sales volume was only 32000 vehicles.

A week after the mixed reform officially ended, on December 10, Changan new energy quickly launched e-pro, the first pure electric SUV model of e-series, and the four models of e-star, e-pro, e-rock and e-life will be gradually put on the market in 2020.

It is worth noting that e-pro is developed on the basis of Changan CS15 fuel vehicle; the other three models of E-series are not pure electric platform development.

To be realistic, new energy is really a loss business, including subsidies. As a full caliber listed company, every penny lost and every penny earned is in the statement of listed companies. Because of this, the amount of new energy in Changan will not be so large. For the sales volume of Changan new energy, Tan benhong, vice president of Changan Automobile, told reporters.

Break and leave in light clothes

Compared with other automobile groups, Changan Automobile has no obvious advantages. The joint venture plate is relatively small in size and single in brand, which is more vulnerable to the impact of economic and political environment. Changan Ford, which used to be the main source of profit for Changan Automobile, suffered from the decline in sales volume and the loss of Changan Peugeot Citroen for years, which made Changan Automobile worse.

In addition to the purchase of Suzukis equity held by Suzuki, the sale of Peugeot Citroen, and the introduction of strategic investors for Changan new energy, since 2018, Changan Automobile has eliminated more than 20 uncompetitive products, vehicles and engines with more than 1 million backward production capacity.

Under the pressure of sales volume decline, Changan has taken all the old plates which are not in line with the future development direction away, which is a very painful process. Zhang Baolin told reporters.

However, it is more important than give up how to seek new increment in the future.

In the future, Changan will always create classic products around the changing needs of consumers, and continue to promote the transformation of Changan automobile to an intelligent technology company around the Shangri La plan and Beidou Tianshu plan. Zhang Baolin said, the strategy is more focused, the path is more clear, closely around the strategic development goal of new energy intelligence, and around the transformation of our enterprise. In addition, we basically dont want to focus on the simple sales target.

In addition, for the short board of independent brands in the field of sedan, Tan benhong said that the sedan of Chinese brands is not recognized. In the sedan market with more than 100000 yuan, there are few Chinese brands, and the rest are low-end products with 70000 yuan and 80000 yuan, with limited profits, brands and public praise.

Therefore, Changan launched Yidong plus, hoping to make the car really make a difference in the 100000 yuan level market from the aspects of new modeling, new power and so on.

Changan must always do a good job at the level of consumers, grasp the needs of consumers, and do a good job in technological innovation. Zhang Baolin said, since 2018, Changan has made a lot of changes in the product appearance design, and the interior is also further younger. The linkage of two screens and three screens is very suitable for the personalized needs of young consumers for technology. In this respect, Changan has firmly grasped it in its hands in the past two years, and will always do well in the future.

In addition, Tan revealed the brand renewal plan of Changan Automobile in 2020. Among them, Changan will renew and iterate the whole brand mission, positioning people and design language.

Changan high-end brand AB will also be launched. Tan told reporters that Changan is about to start a new campaign in the car market. In the future, high-end brand AB will also be a new growth plate in Changan passenger cars.

Source: responsible editor of 21st century economic report: Yang bin_nf4368