2003: Starting with Foreign Trade

Chapter 782 Mr. Tan's Headache Over Stock Prices
Tan Jincheng was quite satisfied with the 1,000-acre factory buildings in Chunxiao Industrial Park after visiting them.

The area is a bit small, but considering that it can be used directly, and that most of the rent is waived, and there are also tax benefits, Tan Jincheng finally decided to build a factory here.

Let's treat this as the production line for the Yuechi A3. For the new energy vehicle side, we'll build another one on Meishan Island, according to the same standards we visited at the BMW factory last time.

The cost is a bit high, but it won't become outdated even after 10 or 20 years, so it's still quite cost-effective.

In addition, the Mitsubishi factory on Meishan Island may be taken over in the future. Since Mitsubishi cooperated with Weilai and introduced two new models, its sales have been quite good. Mitsubishi, which was embarrassed to announce its sales figures in previous years, sold 5 vehicles last year.

This year will probably be similar. Compared to other Japanese brands, 5 units sold is not high, but it is not bad for Mitsubishi, which is trying to re-enter the market.

This does not include their imported models. Yu Nagasawa's work ability after taking over has been recognized by Mitsubishi Motors headquarters.

However, as one of the earliest Japanese brands to enter the Chinese market, Mitsubishi, which was once the top Japanese brand and sold as many as 13 vehicles in China in 2003, is now in a rather regrettable situation.

There was a time when sales of 100,000 vehicles were easily achieved, but now that has become a new goal they need to surpass.

Speaking of Nagasawa Hiroshi and his domestically produced Mitsubishi, they have also been somewhat unlucky. During the Toyota recall incident, Tan's indiscriminate attacks caused some collateral damage to Mitsubishi. In addition, the car-smashing incident that occurred in Changan this year was quite egregious.

Although it wasn't Mitsubishi's brand that was targeted, it still had some impact on their sales in the fourth quarter of this year.

The young man who smashed the car was sentenced to ten years. When he was released, it was already 2022. Tan Jincheng was also sentenced to ten years. He was returned to the original time point. I wonder what this young man thinks about his actions back then.

Regardless, I still hope that Mitsubishi can sell more cars. The Outlander and ASX are both good models, and if more are sold, Tan Jincheng can get more money.

The Chunxiao factory is for the Yuechi A3, the original 840-acre production base in Luzhou was for the Aion S, and the newly built factory is for the next generation Weilai ES6.

As for the tank series, a production base will also be prepared for them in the future.

Within two years, Weilai will need to establish at least two more production bases, which is quite an investment.

That seems to be the significance of physical enterprises. They make a lot of money, and there are indeed many unscrupulous factories, but the investment in infrastructure is also not low. A car factory is not just a car factory.

In November, WILRE officially announced the sales figures for their high-end electric vehicle, the WILRE ES6, for the first time.

With monthly sales of 629 units, excluding the 300 units ordered by Xiaomi, this is the highest monthly sales figure for the Weilai ES6 since its launch. Since its launch in April, a total of 1866 Weilai ES6 units have been sold.

This sales figure has taken the entire automotive market by surprise, especially considering that this is an electric vehicle priced above 30 yuan.

Which new energy vehicle models have sold relatively well this year?

The Chery QQ3 EV, JAC Aiyi, Aion S, BYD Qin, and E6 are all low-priced cars, except for the E6, which has a market guide price of over 30 yuan. The Chery QQ3 EV is even cheaper at only 5.99 yuan.

The E6, which has a market guide price of over 30 yuan in the same class, claims to have sold more than 1600 units. However, 1000 of them were sold to the Shenzhen Municipal Public Security Bureau!
In contrast, the ES6's strategy did not include government procurement. From the beginning, Tan Jincheng did not intend to take the government procurement route. Rather than using the ES6 for government procurement, Tan Jincheng preferred to use the Tank 300 to open up the government procurement market.

The Tank 300 is a more suitable vehicle for official use than the ES6.

"Boss, I have something to report to you."

Cheng Linfeng knocked on Tan Jincheng's office door with a smile. Lately, he'd been secretly amused whenever he saw his boss, wondering what his boss was afraid of.

This story begins with the Forbes rich list in mid-October.

Since the rich list last year, the boss has tried his best to make his assets more concealed, and he also uses some unused shell accounts to control the stocks he holds.

Another method is to make large investments, such as buying houses and cars, spending money in every possible way.

Tesla's shares cannot be touched, and Orange Technology's shares were not only diluted during its last collaboration with Tencent, but were also reallocated, and Apple's shareholder list has disappeared.

Currently, apart from Flash Technology, which remains untouched, most of the other publicly disclosed assets have been disposed of.

Through various maneuvers and public relations efforts, the boss successfully kept the publicly disclosed assets at around 300 billion, which is not much different from last year.

What's funny is that the other bosses seem to have put in more effort in public relations. When the Forbes rich list came out, the boss was completely dumbfounded. He was ranked ninth!
The boss's expression at the time was hilarious to think about.

"What are you laughing at? Just tell me what's going on. Is it about the recent unusual stock price fluctuations at Flashpoint Technology?"

It's currently the Two Sessions period, and the A-share market is not performing very well, but FlashTech's stock price has been rising continuously, which is really strange. The third-quarter earnings season is over.

Tan Jincheng rolled his eyes at Cheng Linfeng, knowing what the old man was laughing about. It was because he had bought a bunch of trending topics to praise the big bosses ahead of him this year.

This year's rich list is a collective explosion of real estate and internet tycoons. Among the top 10, including Tan Jincheng, only four are in the real economy.

Strictly speaking, Tan Jincheng, who has compressed his real assets to the extreme, does not belong to the real assets listed. Most of his listed assets come from equity investments and internet value-added.

Real estate tycoons have collectively surged this year. A few years ago, Wang Jianlin, who had a small goal, was just average, but this year he has soared to third place, and Pony Ma has also jumped to fourth place.

Ahead of Tan Jincheng in line was "Belt Brother," and behind him was a certain Guiyuan.

When the list came out, Tan Jincheng was dumbfounded. He didn't expect everyone to be so cunning. Helpless, he turned his eyes and chose to buy trending searches for these big shots, especially the real estate tycoons, and praised them as much as possible in order to attract attention.

There's no way around it; there's a 27-year-old and a 31-year-old in the top ten, it's just too eye-catching.

"No, that's not it. We didn't plan to reduce our holdings. So what if the stock price is fluctuating? What I want to say is that the liquor sector has fallen too much recently. Is there something going on?"

"Baijiu prices continue to fall?"

Tan Jincheng really didn't know this. He hadn't looked at stocks for a long time. Since he owned the listed company, his private account had been almost frozen. He remembered that there were about 10 shares of Moutai and about 100 million shares of Tencent stock in it.
Neither of these two companies has split their shares in recent years, but they still pay dividends. Tan Jincheng doesn't know the specifics and would have to ask his financial advisor.

Anyway, he made a fortune. He bought all these shares around 05 or 06 at a very low cost.

"Yes, top brands like Moutai and Wuliangye have fallen below the trend line. Moutai is about to fall to the 200 yuan mark. The one that has fallen the most is Jiugui Liquor."

A 30% plunge in two weeks has broken through the trend, and from a professional perspective, such a sharp drop across the entire sector is definitely abnormal.

Stock prices fluctuate during the Two Sessions, but not in this way.

In the A-share market, aside from IPOs, bonds, and some necessary allocations, ByteDance hasn't invested much this year. Now that it's the end of the year, and he's sold off most of his Apple shares, Cheng Linfeng's idea is to allocate some A-share stocks appropriately.

For institutional investors, stocks like those in the liquor industry, which offer strong stability and consistent dividends, are quite suitable.

"Really? Let me take a look."

Tan Jincheng was also curious, so he opened the stock trading software on his computer. He was shocked to see that the liquor sector had been declining for some time, and Moutai's current stock price was around 220 yuan, with a market value of nearly 2200 billion yuan.

In about half a month, Jiugui Liquor lost 52.5 billion yuan, and its market value is now comparable to that of Flash Technology, which has experienced unusual fluctuations.

Ok?
Tan Jincheng suddenly remembered that this was the plasticizer scandal. It seemed that some organizations had known about it in advance.

"There's definitely something wrong with Jiugui Liquor, but the overall industry downturn is probably related to the Two Sessions. Don't rush to buy at the bottom yet, let's wait until next year."

This year's Two Sessions are a special time, and next year there will be a large-scale anti-corruption campaign to ban the use of public funds for dining and entertainment.

Tan Jincheng already knew this news even without his past life's experience; it wasn't news to him now.

The plasticizer incident was actually just a trigger; it wasn't as serious as it seemed. The real problem was this policy, which caused the liquor market to plummet throughout 2013.

Moutai's current market value is 2200 billion yuan, but it will likely fall to around 150 billion yuan next year. I recall that before the bull market in 2015, Moutai's stock price was around 1500 yuan, which was a good time to buy in large quantities.

There should be even lower stock prices available, but as an institution, it's impossible to buy at the absolute lowest point if you want to make a large-scale purchase.

"Alright, let's not rush it then. I'll pause all investments this year except for IPOs. We need to plan our funds carefully."

"Okay, you can decide this yourself."

IPO participation is an ongoing activity. With several sovereign wealth funds backing ByteDance, participating in online and offline IPOs every month already provides a stable income.

Tan Jincheng no longer gets involved much in the stock market. If Cheng Linfeng doesn't ask him, he won't bother even if they start buying at the bottom now. Anyway, the securities division has its own performance evaluation standards for profits and losses.

Given his current status and position, it would be somewhat inappropriate for him to directly participate in stock trading, as it could easily lead to allegations of insider trading.

This is why his private accounts are almost frozen. The reason they haven't been cancelled is simply because a portion of the listed company's shares are held under his private name.

The Two Sessions concluded on November 14.

The A-share market rose slightly by 0.37% that day, barely managing to stay above 2000 points. From the 6124-point level in 2007 to the current defense of 2000 points, things have really changed.

Flashpoint Technology's stock price performed strongly throughout the day, closing at 30.39 yuan, a 10% increase for the day. Its market capitalization of 155 billion yuan set a new record since its backdoor listing, leaving Tan Jincheng truly baffled.

In the first and second quarters, the overall sales of two-wheeled electric vehicles declined by 15%, and the market performance was sluggish. Although the third quarter caught up with the peak sales season and the market shipments rose rapidly, the performance in the first half of the year was still too poor.

It would be good if overall sales could catch up with last year's. Although the market leader, Flash Electric Vehicles, performed well and further expanded its market share, it didn't grow at this rate.

A market capitalization of 155 billion yuan is not high for a leading company in the two-wheeled electric vehicle industry, which also has a trillion-yuan industry. In the future, as time goes by, Flashcar may rise to 300 billion or 400 billion yuan.

However, this is, after all, a manufacturing industry, with little technological content. The current market value of 155 billion yuan has almost exhausted the potential for Flash's market value growth over the next few years.

It is unlikely that Flashspeed will make any major breakthroughs until the new national standard is implemented in 2019.

In addition, the share price of 30 yuan is indeed a bit high.

"This is forcing us to issue high stock dividends."

That's how the capital market sometimes works; it can force you to do things against your will. He doesn't actually want to play the word game of high stock dividends that's so popular right now.

Having lived two lives and achieved extraordinary success, Tan Jincheng still leans towards the mentality of a retail investor when it comes to actual stock trading.

He was ripped off badly in his past life, and although he won't be ripped off again in this life, does he still want to use these word games to fleece investors? What's the point of a high stock dividend? It's nothing more than lowering the stock price through a stock split.

The market capitalization remains the same. The company attracts retail investors by visually lowering the stock price, then sells off the shares after driving the price up. The proceeds from the sale go into the company's pocket, while the major shareholders' holdings remain unchanged.

Simply put, it's like breaking your own pie in half and selling it to you at the original price.

Honestly, high stock dividends are a good thing for stocks with a small total share capital, such as those listed on the ChiNext board. However, this trick has been ruined by some people. For several years, some of the first batch of ChiNext stocks had to issue high stock dividends every year.

Over the years, their total share capital has grown to be more than that of FlashTech, which is simply outrageous. Keep in mind that when they went public, their total share capital was only tens of millions.

If they continue operating this way, FlashTech's total share capital would now be at least 15 billion.

Tan Jincheng doesn't really want to play the high-dividend-paying game. At worst, he can just reduce his holdings to suppress the stock price. Tan Jincheng's shares have long been out of lock-up period and he can reduce them at any time, as long as he issues an announcement half a month in advance.

"There is another good way if you don't want the stock price to rise too fast, but this way will offend more people."

The ES6 from Weilai sold exceptionally well, which made many car company bosses restless. Tan Jincheng had always been the one visiting Brother Chuanfu's factory, but after Weilai announced the actual sales figures for the ES6 in November, Brother Chuanfu came to Ningbo for the first time.

According to internal data from the China Association of Automobile Manufacturers, Weilai Automobile has the most accurate sales figures. After all, it has not been established for long, but its sales have remained strong, which makes it hard for the Association of Automobile Manufacturers not to pay close attention to it.

These days, data fabrication methods are relatively simple and crude, and are actually quite easy to detect.

In addition, the regulatory environment is quite strict. Once it is announced, it will be publicly criticized. Dizi and other car companies have been criticized in this way. Once this matter is reported, you can no longer ignore it.

Firstly, it's a loss of face, and secondly, it's a loss of trust in the eyes of consumers.

Unlike some emerging car companies in later years that use fancy data such as how many large orders or small orders they have, or how many large orders were broken within an hour after the press conference, creating the impression of a hot-selling product.

In reality, it's nothing. The so-called "one-hour order volume" is just a matter of clicking on a mobile phone, just like the sales data of Singles' Day, and it can all be returned.

In addition, some car reviewers are very cunning. They take large orders and go to the OEMs to cooperate. They sell a car for 200,000 yuan, and after a few cooperations, they can recoup the cost of the car. After that, they can easily sell the car for 150,000 or 160,000 yuan, which is pure profit.

Of course, not all car manufacturers are fools. Some car reviewers can tell from his video data that it's fake, so they would never agree to cooperate with him.

But it doesn't matter to car reviewers; they can just return it.

Because many OEM manufacturers' so-called large order lock-in orders do not deduct a deposit! This so-called lock-in order is meaningless. Only lock-in orders that deduct a deposit are real lock-in orders.

After those internet people entered the automotive industry, they couldn't even tell the authenticity of orders anymore. Compared to 10 years later, today's OEMs are like kindergarteners when it comes to data fabrication.

When it comes to playing the game, you have to look to internet companies.

"any solution?"

Tan Jincheng took the boatman on a tour of the factory, and while he was there, he complained to him that FlashTech's stock price had risen too fast recently, consuming up the potential for the next few years. He also mentioned that the limit-up on the 14th was inexplicable.

The boatman just smiled enigmatically.

However, he also offered his opinion: since Tan Jincheng now holds all the circulating shares, it's easy to handle. If institutions randomly drive up the price, we'll just issue a reduction announcement.

Whether to sell or how much to sell depends on my mood. I will issue a reduction announcement when the reduction period is about to expire.

In other words, they issue a reduction announcement every six months, but do not actually reduce their holdings or reduce them only slightly, leaving this sword of Damocles hanging over the heads of institutions and speculative funds trying to manipulate stock prices.

If you play within the rules, that's fine, but if you go too far, don't blame me for smashing you.

"Wow, this trick does work to some extent, but it also definitely offends people."

"Haha, that's right. Your Weilai car hasn't been launched yet, so I was just saying. It's best not to play around like that."

BYD has been listed for many years, and in the past two years they have been tormented by the ups and downs of their stock price and have been frequently attacked.

Business owners in the real economy both want to go public and hate it; many of them simply can't outmaneuver the power of capital.

"That's true. Oh well, we'll see when the time comes."

Offending too much is not an option; forget it, the stock market hasn't been doing too well these past few years anyway. As long as I don't agree to high stock splits, I don't believe you can keep pushing the stock price up.

Alternatively, they could repurchase some of the shares and cancel them later; this is also a common practice.

"Your workshop is quite well done, you must have invested a lot of money. That C-type crane must have cost a fortune, right?"

The boatman looked at the ES6 assembly line with some surprise. As a professional, he could see the value of these machines at a glance, and some of the other equipment was also quite advanced.

"That's right. Last time I visited BMW, I thought their products were pretty good, so I ordered one to try out. If it works out, I plan to replace the entire production line."

Tan Jincheng was quite proud of these things, and immediately ordered a set. It's a pity that there is no integrated die-casting machine yet, otherwise the ES6 would be completely crushed.

Using a large-tonnage die-casting machine to die-cast multiple parts in one go reduces the number of parts and connection processes, thereby reducing production costs and improving production efficiency. This can be considered a revolution in the automotive manufacturing industry.

It seems that Tesla spearheaded the initiative in 2019, and it became fully commercialized in 2020. Die-casting machines are very expensive, but they are worthwhile in the long run.

As for the pros and cons of one-piece die casting, everyone has their own opinion, but that's not important.

In recent years, our press technology has not been very advanced. Tan Jincheng plans to bring up this idea with die-casting machine manufacturers such as Beicang in a few years to see if we can support them in developing it.

There are quite a few die-casting machine manufacturers in Beicang, such as Haitian, Lijing, Xushen, etc. Top has been supported by Weilai Automobile, and several die-casting machine manufacturers can also be supported in the same way.

Top's current development speed is much faster than in his previous life, and his reputation has also improved a lot. After all, Wei has given him plenty of orders, which has kept him very well fed.

There was a joke in Beicang in my past life: before Top went public, it went to the job market to recruit workers, and the workers would turn around and leave as soon as they heard it was Top.

On the other hand, with Weilai in Beicang District, other private enterprises have no choice but to treat their workers better in order to survive, otherwise it would be really difficult to recruit people.

The boatman looked at Tan Jincheng with some surprise: "You're quite willing to spend money. It seems you've spent all the money you've earned in the past few years. The rich list wasn't lying."

The rich list is a joke to these people, but there's nothing they can do about it, especially this year's rich list. With the full recovery of the economy and the booming real estate market, Tan Jincheng's net worth of 300 billion yuan is enough to rank him in the top nine.

Everyone knows what happened. In addition, the fact that Tan Jincheng bought a bunch of trending searches for internet and real estate tycoons has also spread in small circles. After all, Tan Jincheng called to apologize afterward.

No one cared; they just smiled knowingly. It's actually a good thing for young people to want to keep a low profile. Showing off too much would only make them look incompetent.

"Well, let's just mess around. I can't compete with you high achievers like Uncle Wang in terms of technical skills, so I can only throw money at it and see if throwing money at it can produce a few excellent car models."

The boatman nodded. After visiting the car factory in Weilai, he understood why the Yuechi series and the ES6 were more stable in terms of both quality and performance than their cars.

The equipment is advanced, and the workers are full of energy—all thanks to the money invested. This young man is certainly willing to invest; perhaps this is the drive and ambition of youth.

Does BYD have the means to follow suit? Yes, but he doesn't plan to.

Every company has its own business strategy. BYD mainly relies on a large workforce. If they were to completely upgrade their production lines and raise workers' wages, it would lead to several years of turmoil, which they cannot afford.

(End of this chapter)