Since the day when Beijing Jeep was officially listed as China's first joint-venture automobile company in 1984, discussions on the share-based ratio of joint venture auto companies' joint ventures have not stopped. In 2014, with the expiration of FAW-Volkswagen's first-round contract period, the debate over whether the joint-venture auto companies should be released from the red line has once again become the focus of public attention.
The public-funded joint-venture stocks, which are highly regarded by the public, are a policy and regulation formulated by the Chinese auto industry to introduce foreign advanced technology and protect the weakly-positioned Chinese auto industry since the Chinese auto industry started the joint venture model in the 1980s. This policy restricts the Chinese-Chinese share ratio of the joint-venture automobile company to not less than 50%, thus ensuring the control position of the Chinese company in the joint venture company.
However, in recent years, with the booming development of China's auto industry and the continued rise in sales in the Chinese auto market, the call for the opening of the auto industry joint stock ratio has begun to increase. At the same time, based on the particularity of the development of China's auto industry, the self-owned car brand's relatively weak living conditions, the voice of the boycott of the joint-stock ratio is the majority of the public opinion. In the past 2014, these two different voices once again triggered a major debate about the future development of China's auto industry.
The representative of the China Passenger Vehicle Market Information Association, Deputy Secretary-General Yang Zaiyu, supports the open stocks over the red line. The elimination of the auto industry will create a more free and fair market environment than the red line. The domestic vehicle manufacturing industry will Because the joint stock ratio was released, it ushered in a process of shuffling. The competition within the vehicle industry will also become more intense due to the liberalization of the joint-stock ratio, which will eventually reduce the profit margin of the vehicle to a reasonable level, which will benefit domestic car consumers. A fairer and more free market environment will also encourage multinational auto companies to increase their technology and investment in the Chinese market, enhance the enthusiasm of multinational auto companies, and introduce more advanced technologies, models and management methods to the domestic market, thus promoting China's autos. Industrial progress. At the same time, with the liberalization of the joint-stock ratio, China's automobile industry can be better integrated into the wave of globalization of the automobile industry, further accelerating the development of China's automobile industry.
Li Shufu, the chairman of Geely, is also a supporter of this view. He believes that only by liberalizing the stock ratio can an environment of fair competition between foreign-funded, state-owned and private enterprises be created, and the advantages of state-owned auto companies in resource allocation can be broken. In this way, it can effectively support the independent automobile enterprises with clear development routes to achieve long-term development, and ultimately achieve the purpose of independent brand development.
The counter-party's point of view is that Dong Yang, the executive vice president and secretary general of the China Association of Automobile Manufacturers, is the most representative. In a car forum, Dong Yang has publicly responded: "Whoever said that the stock ratio should be released, who is the big traitor. In addition, Dong Yang also repeatedly stressed in the article that, in view of the current status of China's automobile joint ventures, although China holds a controlling position in the joint venture, it is from the perspective of actual control. Chinese auto companies have been in a weak position. The reason is that the foreign side has an absolute advantage in product, technology and management. In particular, the product determines the lifeline of the company's survival has always been in the hands of the foreign party. If in this case, the retreat in the stock ratio, then China will completely lose the right to speak in the joint venture. At the same time, Dong Yang insists that Chinese brands are the core interests of China's auto industry and should be protected.
From this, it can be seen that on the issue of whether the stock is more open or not, the support party has a single word on the opposition party, publicly speaking publicly, and the woman said that she is reasonable. So why is this debate so hot in 2014, and its fuse is the adjustment of the share ratio of China FAW and Volkswagen on FAW-Volkswagen in October this year.
In the past few years, FAW-Volkswagen's production and sales have been climbing. As a veteran joint-venture auto company in the Chinese auto market, FAW-Volkswagen relies on China FAW as the advantage of the Republic's eldest son, and on the other hand, Germany. Volkswagen's superior product support can be described as a good time. According to the earliest joint venture agreement, FAW-Volkswagen's share ratio is 60% for China FAW, 30% for Volkswagen, and 10% for Audi. Obviously, in the case of a favorable Chinese auto market, 40% of German Volkswagen's joint ventures will lose a lot of profits. In fact, as early as the spring of 2012, FAW Group and Volkswagen Group’s negotiations on FAW-Volkswagen’s renewal of the contract were once deadlocked because of the joint-stock company’s share ratio. The differences between the two parties were mainly concentrated on Volkswagen’s dissatisfaction with 40% of profit distribution. As well as FAW Group's own engines and gearboxes are suspected of copying mass technology. In 2012, there was even news that German Volkswagen would sue China FAW for plagiarism. But this event is finally gone. In October 2014, with Premier Li Keqiang's visit to Germany, FAW-Volkswagen's renewal was completed as scheduled, and Premier Li Keqiang also made it clear: "China will actively consider the request of Volkswagen to increase the proportion of shares in the FAW-Volkswagen joint venture."
According to relevant information, FAW-Volkswagen's future share ratio adjustment plan may be 51% for China FAW, 30% for Volkswagen, and 19% for Audi. After the relevant authorities adjusted their position on FAW-Volkswagen's joint-stock ratio, China FAW and the German Volkswagen also held a substantive discussion on the matter, but as of press time, the negotiations between the two sides continued. The dispute between the two sides is that the condition for the Chinese side to require Germany to increase its shareholding is that the Volkswagen Group should provide the technology of Volkswagen and Audi brand to support the development of China FAW's own brand. However, the public said that this requirement involves the core patents of Volkswagen, and the independent brands provided to China FAW at this stage are unacceptable to the public. On the other hand, the two sides also have objections to FAW-Volkswagen's balance sheet statistics, which requires further asset valuation to consider equity returns and expenditures. However, the issue of the ratio adjustment is still positive.
It is not difficult to find out from the reasons for the adjustment of German Volkswagen's straight-forward stocks that the market and profits are the most fundamental driving force for the adjustment of domestic joint-stock ratios, and this momentum also promotes the opening of joint-venture stocks than the red line. Behind the focus of the dispute over the red line is the issue of the distribution of interests in the Chinese auto industry. This involves many interests of the government, joint ventures, Chinese and foreign joint ventures, and consumers.
At the government level, the attitude has been very clear. In November 2014, the National Development and Reform Commission issued a revised version of the “Guidance Catalogue for Foreign Investment Industriesâ€. According to the spirit of “further expanding the opening up to the outside worldâ€, the new catalogue has cancelled more than ten items including steel. The industry's foreign investment restrictions, this is also the largest revision of the "Guidance Catalogue for Foreign Investment Industries" in the past 19 years, including the motorcycle industry closely related to the automotive industry. However, the new catalogue still clearly lists “automobiles†as an industry catalog that restricts foreign investment, and still maintains “the Chinese stock ratio is not less than 50%â€. In other words, the red line of policy has not been released because of the role of public opinion.
From the perspective of the government, China's own-brand auto industry is still relatively in the growth stage. It still needs sufficient time and space to cultivate. If the restrictions on the joint-stock ratio are released at this time, then the core resources will be mastered. Foreign-funded enterprises will surely have a strong impact on China's own brand industry, which is in a rapid growth period. The worst case scenario is that China's auto industry is completely monopolized by foreign parties, and the probability of this possibility is quite high at this stage. Under this circumstance, China's auto industry will be transformed into a purely domestic auto industry. Once China's domestic auto consumer market is saturated or its profit margins fall, multinational companies will definitely withdraw from the Chinese market. The government will only be the high unemployment rate and the extremely surplus capacity.
Judging from the latest industries that have restricted foreign investment restrictions, it is not difficult for us to conclude that the government's premise of liberalizing foreign investment restrictions is based on the international competitiveness and influence of the technical capabilities of domestic related industries. Obviously, the liberalization of foreign investment restrictions in this situation will help domestic superior enterprises to accelerate their integration with the world's advanced levels, create an open industrial layout, and achieve sustainable industrial development.
From the perspective of the joint venture, the biggest loss after the stock ratio is released is necessarily the Chinese side of the joint venture. Therefore, in the issue of stock-to-share ratio, the major state-owned auto companies that rely mainly on their joint ventures to make profits are opposed. Because once the profit transfer of the joint venture is blocked, the autonomy of these major state-owned auto companies is difficult to support the profit margin of the entire group. At that time, a group of state-owned large auto companies represented by China FAW will be in ruins. Ground. For the foreign side, the opening of the joint-venture stock ratio is like the wild horse that unlocks the reins. No longer the Chinese restrictions will accelerate its expansion in the Chinese auto market. Judging from the brand influence of multinational auto companies, no Chinese partner will not affect its market share change, and the profit rate will further increase. Therefore, in the issue of the stock being released from the red line, the multinational auto companies are obviously going to show a more positive attitude. For self-owned brands, the opening of joint-venture stocks than the red line does not affect the living space of independent brands too much, because the status quo of self-owned brands has been a positive confrontation with multinational brands, and this process is not What is the Chinese side of the joint venture? As Li Shufu said, the current independent brands are not afraid of multinational car companies, and they are not afraid of breaking state-owned enterprises.
From the consumer's point of view, with the deepening of the market economy and the gradual maturity of China's auto consumer market, it is true that the joint venture stocks will not shake the auto market's lower and lower prices than the red line. trend. As long as there is competition, there will be innovation, and if there is innovation, there will be new products. However, if there is no self-owned brand to smash the market, the multinational companies occupying China's automobile consumption market will soon reach a balance. At that time, the speed of new products and the price of models will probably be the same as those in South America. Subject to people. Therefore, in the long run, it is not a good thing to release stocks at the current stage.
Then, the joint stock should not be released than the red line. From the perspective of industrial sustainable development, the expansion of joint-venture stocks over the red line is the trend of the times. To achieve sustainable development, China's automobile industry must create an export-oriented automobile industry. In the process of building an export-oriented automobile industry, China's independent automobile industry must actively participate in international competition. The release of joint-venture stocks over the red line is undoubtedly a test for China's independent automobile industry to go global. Then, when can we release the red line of the joint-stock ratio, which depends on the development of China's independent automobile industry under the protection of the joint stocks than the red line. Any industry has never existed in isolation, and the automobile industry cannot do without the industrial chain. support. Only when China's independent auto industry can truly achieve certain international competitiveness in the entire industry chain is the time when the joint stocks are released from the red line. The premise of all this realization depends on the development ideas of Chinese auto companies on the joint venture road.
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