After the successful acquisition of Changfeng and the marriage of Fiat, GAC once again raised the banner of acquisition, this time the goal is Zhejiang Gio Auto.
“Guangzhou and GAO have been in contact since June. Under the impetus of the Development and Reform Commission of Zhejiang and Guangdong, the two sides have signed an asset confidentiality agreement, or they will set up a joint venture company that holds 50% of the shares.†According to a person close to GAC Gio The person familiar with the negotiations told the “Daily Economic News†that at present negotiations have made substantial progress. If the cooperation is successful, the joint venture company will rely on Keo Xiaoshan base to produce micro-faceted products, and Guangqi will be appointed as chairman of the joint venture company.
Zhejiang Development and Reform Commission leads the first contact in June
“At present, we are indeed in contact with several large auto companies, including Guangzhou Automobile, but the negotiations with Guangzhou Automobile are the most in-depth,†said Geng Xuezhong, chairman of Gonow Automobile, in an interview with reporters recently.
“The negotiations between GAC and Gonow have received strong support from the relevant government departments in the two places. The Zhejiang Development and Reform Commission is the main behind-the-scenes promoter,†a person close to the Zhejiang Development and Reform Commission revealed to reporters. “If the negotiations are successful, each holding 50 will be held. % of the joint venture company, GAC will be appointed chairman of the joint venture, focusing on micro-faceted products, the joint venture company's annual production capacity will reach more than 100,000 vehicles."
Senior auto analyst Zhong Shi said in an interview with reporters that the cooperation with state-owned auto companies is different. The mechanism of private enterprises is more flexible, and it is reasonable to reorganize private enterprises to receive support from relevant authorities.
The above informed person told a reporter about a detail. At the end of June this year, Governor Lu Zuzian of Zhejiang Province met with Governor of Guangdong Province Huang Huahua while visiting Guangzhou. When Huang Huahua talked about the cooperation between the two provinces in the automotive industry, he specifically mentioned the cooperation negotiations between Guangzhou Automobile and Gonow. However, Lu Zushan was unaware of the situation at that time. Lu Zushan learned after learning that the Zhejiang Development and Reform Commission was behind the scenes.
The above details precisely reflect Gio as a private enterprise, which is different from the flexible mechanism of state-owned enterprises in the negotiation process with foreign automobile companies. The simplification of relevant procedures will also greatly enhance the possibility of GAC GIO cooperation.
According to a person familiar with the matter, GAC related senior officials went to Hangzhou for the second time to negotiate with Gio Auto in July. Since GAC intends to control the joint venture company, GIO hopes to maintain its own characteristics and brand after cooperation, and the issue of autonomy becomes the focus of negotiations between the two parties.
Industry insiders pointed out that each joint venture company holding 50% of the shares does not mean absolute equality of rights and obligations. It still needs the cooperation parties to conduct equal consultations on a series of details. This is the prerequisite for successful negotiations.
Layout of Jiangsu, Zhejiang, Guangzhou Auto Guangzhou Commercial Vehicles
Under the guidance of the automobile industry revitalization plan to encourage corporate mergers and reorganization policies, Guangzhou Automobile has become the largest “shark†in the automotive industry this year. The development of South China has apparently been unable to satisfy Guangzhou Automobile’s appetite.
However, GAC, which was acting in a high-profile manner, uttered utmost caution before the matter was finalized. In the face of the recent rumor that Gio was marshaled, GAC has always chosen a low profile. Gao Li, head of investment department of GAC Group, and another senior executive in the interview with “Daily Economic News†reporters all evaded this issue.
It is understood that for GAC, which started with sedan products, the commercial vehicle business has been a short board. Its own brand of commercial vehicles, GAC Bus and GAC Hino, which focuses on the Hino brand, are not satisfactory, and they mainly focus on pickup trucks and micro facets. GIO cars with SUVs can exactly meet the shortcomings of GAC's product structure.
According to the aforementioned informed sources, if GAC and Gio succeed in the cooperation, the joint venture company will first rely on the Gio Xiaoshan base to develop the micro-facet project, which is currently the flagship product that Gio Motors is proud of.
"In addition to focusing on Geomatic's mini-vehicle project, GAC's move is based on strategic considerations." Zhong believes that GAC wants to step out of southern China and become a cross-regional automobile company; in addition, it can also solve commercial vehicles through the extension of its production base. The product logistics radius is too long.
Senior automotive analyst Jia Xinguang also believes that Guangqi’s northward expansion is due to the consideration of the national strategic layout. Currently, Hunan has already been successfully deployed, so it is reasonable to extend the antenna to Zhejiang, and the parts base in Zhejiang is very good. Several powerful vehicle companies have led the industry. Therefore, if GAC and GIO succeed in the negotiation, it can be described as a match.
Based on self-reliant Gio borrowing reorganization force
In the vein of Gio's development in recent years, it can be found that this private car company based in Zhejiang is not satisfied with being an obscure small company.
"Regardless of who they work with, the premise of Gio's reorganization with other companies is not to give up Gio's brand, nor to give up Gio's current product positioning and product development strategy," said Geng Xuezhong, chairman of Gonow, accepting the "Daily Economy." News reporter said in an interview.
Compared with Guangzhou Automobile's low-key, Gio has a lot of high-profile.
Not long ago, Gio Motors established the GIO Automotive Research Institute in an effort to strengthen GIO's product R&D capabilities. At the same time, Wang Zhaopei, the chief engineer with more than ten years of experience in product development in the Chang'an Group, served as executive vice president of GIO Automotive Research Institute. , presided over the daily work of the institute.
"If we want to cooperate with other companies, we must first enhance our own strength and increase our right to speak in the process of cooperation," said Yu Zhaohong, chairman of Gio Motors.
Zhong Shi believes that, unlike GAC, which already has a lot of strength, Gio, who is a privately-owned auto company, needs to attract eyeball speculations to get support in terms of bank credit and land approval, thereby accelerating the development of the company.
Yu Zhaohong said that Gio's product line is different from most other companies. At the same time, Gio Auto's products are positioned in the rural market. This market segment has broad prospects and competitors are ambiguous. Gio has a strong competitive advantage in this field. At the same time, GIO's system and development strategy are relatively flexible, so there is a huge room for cooperation with many large companies including GAC.
Interview
Chairman of the Board of Directors: Qiu Xuezhong: All surviving variables
Taking advantage of the restructuring of Dongfeng with Guangzhou Automobile, an unknown Zhejiang private-owned company, Gonow, has recently become the focus of discussion in the industry. In the opinion of Geng Xue, chairman of Gonow, GAC is only one of its many choices. In the interview, Yan Xuezhong told the reporter of the “Daily Economic News†that “Geo cars are still young and there are many gaps with their predecessors. There are still many things to learn. However, before the final agreement has been signed, everything is just a Unknown."
In the snow, Gio's products are positioned in the rural market. This subdivided market has broad prospects and competitors are weak. Gio has a strong competitive advantage in this area. For many large companies, this feature of Geo has great attraction, and it has indeed attracted many large-scale enterprise groups including Guangqi to negotiate with Geo.
Yu Xuezhong stated that the reason why it is relatively close to GAC is that GAC, as a large-scale enterprise with profitability among the industry, has demonstrated strong tolerance and strong development momentum in cooperation with other partners. Through cooperation with GAC, it is possible to enhance the brand influence of Gonow and optimize the management system of Gonow to drive the further development of Gonow.
However, in the face of cooperation, Yan Xuezhong also put forward the bottom line of Gio, that is, do not give up Gio brand, will not give up Gio's current product positioning and product development strategy.
Yu Zhaohong, chairman of Gio Motors, also mentioned in the interview that Gio is a very young company. Judging from its product lines and market segments, Gio’s models differ from most companies. Moreover, as a private enterprise, Goo has a more flexible system and development strategy. As long as it is beneficial to the development of the company, Goo will choose to try. Therefore, there is a huge space for cooperation between Gonow and many large companies. Specific to the cooperation with Guangzhou Automobile, GAC Group has advanced production technology and good management experience. GIO Automotive not only can learn more advanced management methods and concepts from GAC but also can enhance the brand value of GIO Automotive.
Yu Zhaohong also repeatedly stressed to the reporter of “Daily Economic News†that GAC chose Gio, not only the rumors of the outside world but also the Gio's mini-vehicle catalogue and commercial vehicle production capacity. Gio's own development capabilities and the relatively rich automobile production environment in Zhejiang Province are factors that GAC considers. “With this cooperation, Guangzhou Automobile can penetrate into the abdomen of the Yangtze River Delta and Central China to seek greater development. Besides the micro-vehicle, which everyone is talking about, the cooperation between GAC and Geo will be for both parties. All will be a very important strategic layout."
At present, there are reports that the cooperation between GIO and GAC will use Gio Xiaoshan base as fixed assets, GAC will invest in equivalent funds to establish joint ventures, each with 50% shares; the management team still mainly retains Gio's original team. GAC will provide management support for the new company; the brand of the new company may use the combination of “GAO GIOâ€. In this regard, both Yan Xuezhong and Yu Zhaohong did not deny, but said that it was not convenient to disclose it at present.
Goo Information
Gio was still a little-known company before the "scandals" came out of Guangzhou Auto. It is understood that Gio was founded in September 2003 and is a privately owned vehicle manufacturer in Zhejiang that specializes in pickups, microfabrics and SUVs. The founder and chairman of Gio Motors, Yu Xuezhong, was the general manager of Geely Automobile. Li Shufu, the head of Geely Auto, was a fellow of Taizhou, Zhejiang.
On August 17, 2006, Gio Motors, which had been established for less than three years, won the title of “national auto vehicle export base enterprise†granted by the Ministry of Commerce; in March 2008, Gio Motors spent 2.4 billion yuan in Shandong. Dongying Investment and Construction Production Base, which mainly produces pickup trucks, SUVs and auto parts projects. On May 25 this year, the Xiaoshan manufacturing base of the 250,000 annual production capacity of Geely Automobile was officially opened, and the first mini vehicle Xingwang was rolled out.
After the implementation of the “cars to the countryside†policy, Gioau ushered in a period of rapid development as two models (pickes and micro-cars) produced were simultaneously included in the subsidy for car-to-country products.
According to reports, Goo's achievements in the field of small commercial vehicles and Zhejiang's unique geographical advantage have caused great interest among many large-scale automobile enterprise groups, and have also caused Guangzhou Automobile, which intends to expand northward, to turn its gaze to Zhejiang and Gio.
View related topics: China's auto industry recommence mergers and acquisitions wave
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