Reporter Gong Mengze

　　After being taken over by Ideal Auto for 6 billion yuan, the problem of overcapacity in Beijing Hyundai has not been alleviated.

On February 23, the news that Beijing Hyundai's Chongqing plant had ceased production spread like wildfire.

Although Beijing Hyundai insisted in response to the "Securities Daily" reporter that it had not received any internal documents on the suspension of production.

　　According to sources close to Beijing Hyundai, "Most production lines of Beijing Hyundai's Chongqing plant have been suspended since December last year, and workers are also on vacation." In addition to the first factory, there are 2 factories in Beijing and 1 factory in Chongqing and Cangzhou.

　　In fact, in recent years, my country's passenger car market can be described as volatile. Traditional car companies have struggled to break through, and the sales of new car manufacturers have repeatedly hit new highs.

On the one hand, Li Auto will win the sales champion of medium and large SUVs with an absolute advantage of 91,300 units in 2021 after taking over the first factory of Beijing Hyundai.

On the other hand, Beijing Hyundai's public opinion focuses on whether the other two factories will be resold.

　　Cui Dongshu, secretary general of the National Passenger Vehicle Market Information Association, said that with the intensification of brand differentiation in the domestic auto market, many joint venture car companies have encountered challenges in their operations, and they are more eager to break through the current predicament through equity changes and find new development opportunities.

"From Suzuki Motor's withdrawal from the joint venture Changan Suzuki, to the shareholding changes of Dongfeng Renault, FAW Mazda and Dongfeng Yueda Kia, many cases reflect that the period for joint venture car companies to enjoy the dividends of the Chinese auto market has passed." Cui Dongshu said.

　　Sales stall and severe overcapacity

　　Encountered an unprecedented crisis

　　In the final analysis, both Beijing Hyundai’s sell-off factory and the shutdown of its Chongqing factory are closely related to its current market performance.

　　In fact, in terms of global market sales, Hyundai's performance last year was acceptable.

According to sales data released by Hyundai Motor Group, despite the adverse impact of the global epidemic and supply chain management issues, Hyundai Motor's global sales in 2021 will still reach 3.891 million units.

In addition to the market sales of Kia, Hyundai Motor Group has achieved the fourth best result in global sales after Toyota, Volkswagen Group and the Renault-Nissan-Mitsubishi alliance.

　　It's just that in the Chinese market, this Korean car company seems to have lost its way and suddenly became unaccustomed.

　　As Hyundai's main joint venture in the Chinese market, Beijing Hyundai's market performance directly illustrates the problem.

According to public data, Beijing Hyundai's cumulative sales in 2021 will be about 385,000 units, down 23.3% year-on-year.

This is the fifth year that Beijing Hyundai's sales have declined since 2017.

Last year, Beijing Hyundai also failed to achieve its sales target of 560,000 units set at the beginning of 2021, with a target completion rate of only 68.75%.

　　In contrast to Beijing Hyundai's production capacity planning, the original five major factories are expected to have a production capacity of 1.65 million vehicles. Compared with the sales results in 2021, even compared with the sales target of 560,000 vehicles set at the beginning of 2021, there is still a huge gap.

"Even if the first factory is sold, the remaining four factories of Beijing Hyundai have a production capacity of about 1.35 million vehicles. The capacity utilization rate is still less than 30%." Zhang Xiuyang, secretary general of the China Passenger Vehicle Industry Alliance, believes that in the past few years of rapid development , Beijing Hyundai's analysis of the Chinese market and its own business conditions is too optimistic.

　　According to the reporter's understanding, after 2016, Beijing Hyundai decided to expand its production capacity, and the Cangzhou factory and the Chongqing factory were built successively.

Among them, the Chongqing plant with a total investment of 8.39 billion yuan was completed in 2017 with a designed annual production capacity of 300,000 vehicles.

Unexpectedly, in 2018, Beijing Hyundai's sales fell rapidly, and in 2019, negative news about the adjustment of Beijing Hyundai's first factory staff and the shutdown of the factory continued to be exposed.

　　In order to reverse the decline, Beijing Hyundai has also actively organized self-help.

In the second half of 2020, Beijing Hyundai will launch a number of new cars, including the Elantra, the all-new Sonata and the Tucson L.

In 2021, Beijing Hyundai launched six new models while streamlining the number of dealerships.

However, the market performance of Beijing Hyundai has been hard to come back, and after the sharp decline for several consecutive years, it has long disappeared from the sales ranking list of the Passenger Federation.

　　Seeking changes in share ratio

　　Facing greater difficulties and challenges

　　"Beijing Hyundai may be considering a change in the shareholding ratio of the joint venture." An industry insider who did not want to be named revealed to the "Securities Daily" reporter that Hyundai Motor Group is working to increase the shareholding ratio of its joint venture in China, Beijing Hyundai, and may follow suit Kia's role in the new joint venture.

In this regard, Modern China responded to the reporter saying that it "has not received relevant news yet."

　　In fact, Hyundai Motor has been rumored to want to strengthen its dominance in the joint venture for a long time.

As early as mid-2021, there was news that Hyundai Motor was preparing to increase investment by the end of the year to boost its stake in Beijing Hyundai.

At that time, Beijing Hyundai did not reply to the rumors.

Today, the first factory of Beijing Hyundai has been taken over by Lili Automobile.

　　Faced with rumors of Beijing Hyundai's share ratio adjustment, in January this year, Cui Dongyou, general manager of Beijing Hyundai, responded: "Hyundai has no plan to adjust the shareholding ratio of Beijing Hyundai's joint venture, and the joint venture contract between China and South Korea will expire in 2032." However, he It is also acknowledged that the market performance of Beijing Hyundai in 2021 will decline significantly compared with the previous year.

　　It should be pointed out that Beijing Hyundai is of great strategic significance to BAIC Group.

According to the reporter's understanding, at the high point of performance in 2015, Beijing Hyundai's sales accounted for more than 40% of the BAIC Group.

Although Beijing Hyundai's sales have suffered year-on-year declines, its position in the BAIC Group is still very important, and the difficulty of adjusting the corresponding share ratio can be imagined.

　　In this regard, Zhang Xiuyang believes that if we want to achieve a flexible localization strategy and the pace of brand technology and product introduction to keep up with changes in the Chinese market, Hyundai Motor must have greater initiative and voice in the relationship between the two parties.

This is also the reason why Hyundai Motor intends to increase its stake in Beijing Hyundai.

　　According to Shi Jianhua, deputy secretary general of the China Association of Automobile Manufacturers, after the full liberalization of the shareholding ratio, there may be some changes in the domestic auto market, but in the end, it depends on the contribution and capabilities of the Chinese and foreign parties in the joint venture.

"In recent years, Chinese car companies have grown rapidly and have considerable confidence and strength. However, if foreign companies want to increase their stakes in their joint ventures in China, it will be difficult and challenging in terms of capital and localized development. "Shi Jianhua said.

(Securities Daily)