From knock-off old-man's electric vehicles to industrial giant

Chapter 45 Settling in Zibo, New Factory Plan

Think about it carefully.

Xu Yi finally realized where the problem lay.

That's right.

The so-called Guojin Automobile Company has not been established in the strict sense.

Guojin Auto's predecessor, Guojin Group, was a mess of fraudulently obtained qualifications and a bunch of bad assets and debts!

Ultimately, Guojin Group is just a shell company; the real decision-makers are the local government and urban investment groups.

Because the approval of vehicle manufacturing qualifications requires the approval of the National Development and Reform Commission and the review of the Ministry of Industry and Information Technology, in the final stage, the expert group of the Ministry of Industry and Information Technology also needs to conduct on-site audits of the vehicle manufacturing companies.

What is being reviewed?
In essence, these are the core indicators: production process, quality control, R&D capabilities, and company size.

To put it bluntly, it all comes down to whether you have the ability.

The current issue is that Guojin Group is stuck here and cannot get the approval.

The expert team isn't stupid; they can't just haphazardly modify the factory area and install a production line to fool people.

Because of the awkwardness of the current policy.

To apply for new energy vehicle manufacturing and sales qualifications, two necessary conditions must be met.

Firstly, it can only be implemented in provinces with high capacity utilization and strong supporting capabilities.

Secondly, it requires proof that the company has "actual production capacity".

The conditions here in Shandong are naturally excellent; both the industry and supporting facilities are sufficient to support a large car manufacturing company.

However, there is a large gap in the field of "new energy passenger vehicles".

The second one was a bit awkward.

To meet this requirement, you must first prove that you have "actual production capacity," and this actual production capacity is not just talk.

Instead, we need to actually invest money to build factories and achieve an annual production capacity of over 100,000 units. Even if it's just to make a show of it, we need to achieve an actual production capacity of at least 50,000 units.

Companies like "Guojin Group" apply for car manufacturing licenses using shell companies, hoping to obtain the license by simply building a few cars.

The idea is wonderful. As long as the application is approved, the company can use the production qualification to raise funds and go public, and at the very least, it can make several billion.

In the worst-case scenario, the production license will be sold off as a package deal, and many emerging car manufacturers will be willing to spend billions to take it over.

However, local governments are naturally unwilling to allocate resources to such schemes that involve getting something for nothing, as it would be a waste.

As for why Guojin Auto was able to obtain the permit later?

The reason is probably quite simple: after experiencing debt defaults and asset restructuring, local government financing vehicles (LGFVs) have finally stepped in, and with the integration of multiple capital sources, someone has taken over this mess of debts.

The original shell factory should be properly rebuilt and treated as a major project.

On this basis, an additional investment of one or two billion yuan was made to build a factory for production in accordance with the Industry 4.0 standard. With the support of the local government and strict adherence to national standards and procedures, we finally obtained the independent car manufacturing qualification.

of course.

The listing qualification of Shaanxi Automobile Group played a decisive role in this process. Without this listing qualification, the cars produced by the factory built after the restructuring of Guojin could not be sold.

Most importantly, with this qualification, the passenger cars produced were officially launched and achieved some impressive results, proving that they have the potential to be invested in.

It's like borrowing a bow first, and then following the "shoot the arrow first, then draw the target" approach.

The application process was quick, taking only a few months, which is almost the fastest application record in the car manufacturing industry.

However, based on the time when Guojin Group initially acquired Shaanxi Automobile Tongjia shares, it actually took several years to complete the process of applying for "independent vehicle manufacturing qualification".

"In other words, Guojin Group is currently unable to obtain an independent vehicle manufacturing license, but their shell factory and bus modification production line are being sold under the name of Shaanxi Automobile Tongjia Branch..."

Xu Yi pondered, "This situation is definitely worse than I expected."

But upon closer reflection, it makes a lot of sense.

There's no such thing as a free lunch. If Guojin Group has truly reached the final stage of its application and is absolutely certain of success, it will not easily restructure and sell its equity and assets, even if it faces a debt crisis.

Fang Ziqiang nodded repeatedly: "Yes, President Xu, according to asset estimates, the assets under Guojin Group have severely depreciated. Including that car modification production line, the total value is less than 300 million. Add to that a pile of bad debts and mining qualifications that are almost unprofitable, and there are very few people willing to take over." In short, the cost-effectiveness is too low.

Those with real strength don't care, while those who want to legitimately manufacture cars and obtain licenses have better options.

"Wait a minute...you just said that their group also has a salt lake surveying right?" Xu Yi suddenly asked again.

“Yes, Mr. Xu, but the surveying rights certificate they hold is for the Qinghai Salt Lake. At the current market price of 50,000 yuan per ton for lithium carbonate, without any lithium concentrate being surveyed, this qualification certificate, even if they later pursue the path of exploration to mining, probably will not be commercially viable. It will definitely be a liability.” Fang Ziqiang shook his head again.

Given Guojin Group's current situation, anything of value has already been assessed, and the capital market will never miss any opportunity to make money.

But Xu Yi was greatly moved upon hearing these words!

Currently, although Guojin Group does not have independent car manufacturing qualifications, it has a ready-made factory production line and affiliated car manufacturing qualifications, and also has a salt lake surveying right.

It's a mess now.

However, in two or three years, due to the rise of the new energy industry, the international price of lithium carbonate will skyrocket, making this salt lake survey right very expensive.

At that time, the originally unprofitable salt lakes were also vigorously developed due to external factors, pushing the price of lithium battery raw materials to the sky.

It's important to understand that the most expensive component of a new energy vehicle is the battery. With the price of battery raw materials skyrocketing, those new energy vehicle companies that barely managed to survive have been working for free due to the soaring prices of lithium ore raw materials before they even turned a profit.

There is another crucial point.

At this point in time, he can still utilize Guojin Group's existing affiliation qualifications and factory production lines.

This means that the development cycle of new cars can be greatly shortened. After all, it takes a huge investment to build a 4.0 factory from scratch, and it would take at least six months to a year.

As for car manufacturing qualifications.

Judging from this situation, he is following the future development path of Guojin Auto. If he demonstrates sufficient strength and sales, and follows the "shoot the arrow first, then shoot the target" approach, then applying for the only "independent car manufacturing dual qualification" in Shandong Province will probably be a piece of cake.

With the affiliation qualification and a readily available second production line, their first new car with roadworthiness and registration will not be far off.

Xu Yi pondered for a moment before speaking.

"Contact Guojin Group and find a way to acquire it outright, making it our company's second production base."

"President Xu, do you mean that you not only want to acquire Guojin Group, but also build a new factory there?!" Fang Ziqiang was taken aback.

The information about the planned construction of a new factory is already public knowledge among the company's senior management.

the reason is simple.

With sales exceeding 40,000 units, the combined production capacity of their two factories is no longer sufficient.

Due to limited land, it is impossible to expand equipment and personnel.

The factory's current maximum production capacity is only around 35,000 units per month. This is the result of using financial resources to increase the performance bonuses of all factory employees and encourage them to work overtime to maximize production capacity.

The monthly sales figure of 40,000 units was barely achieved because a batch of inventory was stockpiled ahead of schedule.

As a car manufacturer that is not very large to begin with, it also does not have a high degree of automation.

It has truly burned out.

To maintain the current sales volume, production capacity definitely cannot keep up.

Therefore, building a new factory became an urgent matter.

“That’s right. Get this done as soon as possible. Don’t lower the price too much. Focus on efficiency. I believe they won’t refuse at this price,” Xu Yi nodded and said.

Even without the Guojin Group opportunity, he had considered building a new factory in Shandong.

the reason is simple.

The first step is to move some production lines there to expand production capacity.

Secondly, that area is a cluster of elderly-friendly businesses, where supply chain costs will be lower than here, and they can also benefit from certain policy subsidies, further reducing costs. These conditions are not available in Luzhou.

They had already penetrated their competitors' stronghold in terms of sales; now it's time to fully integrate themselves into their market!
……

(End of this chapter)