View of the cause: The danger and opportunity of the annual loss of 2.2 billion yuan

As a brand new car brand, it may not be surprising that Qoros Automobile, which is still in the “burning money” stage, has a heavy financial report.

According to the 2014 annual report of the Qoros Automotive Group, its 2014 net profit loss was US$350 million, an increase of 37% compared to the US$255 million in the same period of 2013. This also means that the amount of net loss confirmed in the 2014 consolidated annual report of Guanzhi Auto was as high as nearly RMB 2.2 billion; and as of December 31, 2014, the net current liabilities of the Qoros Automotive Group were as much as RMB 4.1 billion.

With a loss of nearly 2.2 billion yuan a year, Guanzhi Auto under heavy pressure began to look for new ways to break through. This financial situation is also a difficult test for the new team that has just taken office.

Heavy under the "good sign"

At the end of April this year, Qoros Automotive’s 2014 financial report released by the Israeli company’s foreign shareholder revealed the latest financial status of the company.

The report shows that during the reporting period of 2014, during the reporting period, the annual operating income of 139 million U.S. dollars was realized, and the operating cost was as high as 165 million U.S. dollars. For the full year of 2014, the annual operating loss of the company was 318 million U.S. dollars, an increase of 26% from the 251 million U.S. dollars in 2013, and the net profit loss was 350 million U.S. dollars, which was higher than the 255 million U.S. dollars in 2013. 37%.

However, it is also worth noting that despite the fact that the financial situation in 2014 remained a substantial loss, in fact, the loss situation of Qoros car has already begun to improve in the fourth quarter of last year - in the fourth quarter of 2014, Qoros Auto The operating loss was US$106 million, which was a year-on-year decrease of 23% compared to the US$139 million in the same period of 2013; the net loss for the same period was US$118 million, which was also lower than the net loss of US$144 million in the fourth quarter of 2013. %.

“The increase in the operating expenses of Qoros Automotive was mainly due to the increase in sales expenses and freight charges, totaling US$105 million. At the same time, management expenses and R&D expenses were reduced by US$67 million.” Kwok Cheung’s 2014 financial report made If it is explained.

“The direct cause of the loss of Qoros Auto was also the substantial investment made by the two parties’ shareholders during the initial period of the company’s establishment of Qoros Auto, and at least from the current perspective, Qoros Automotive has not had enough capacity to invest in such market sales. It was converted into revenue.” An industry analyst who declined to be named said in an interview with this reporter that the loss is a process that must be experienced by Guanzhi as a brand new automobile company. How to restore hematopoietic ability as soon as possible is a concept An important way to get rid of losses.

Continuous blood transfusion

In the past two years, both shareholders have frequently made blood transfusions on Guanzhi Auto. According to the reporter’s understanding, in January 2014, the shareholders of the Israeli-Israeli Automotive Group and the Chery Automobile each made an additional investment of US$41 million. On June 9 last year, the Israeli group again adopted the convertible bond approach to apprehend Invested 81 million U.S. dollars. In 2013, the Israeli group also invested 138 million U.S. dollars with Chery Automobile respectively.

"Up to now, according to the joint venture business plan, the company has fulfilled all its obligations to invest in Qoros." After completing the two investments in Qoros in 2014, the Israeli group disclosed. According to the Qoros Automotive Financial Report, if the 81 million U.S. dollars of convertible bonds provided by the Israel Group in June last year could not be approved by the relevant authorities to be converted into shares of Guan Zhi, the company would need to repay the Israeli group principal and interest by loan. In this way, after the shareholders have done everything in their power, how to realize the hematopoietic function as soon as possible has become a top priority of Guanzhi Auto.

In fact, with the exception of the Israeli group’s financial support for Qoros, the Chinese carmaker Chery Automobile’s support for Qoros is also very impressive. According to the reporter’s understanding, for a long time, in the cities or regions where there are vehicles of Guanyin’s production facilities, any company provided a guarantee for any amount of bank financing from the bank, and Chery will provide half of the corresponding guarantees. Since July 2012, Chery has provided Guanyin with guarantees equivalent to RMB 750 million.

It must be said that from the improvement of the financial situation in the fourth quarter of last year, it can be seen that with the strong support of both shareholders and the efforts of the team of Guanzhi Auto, Guanzhi Automobile has also made some gains in the difficult development process. But next, how to quit blood transfusions and supplies to Chinese and foreign shareholders is a big test for the team of New Vision Automotive.

New Pilot's Test of Murphy

On February 2 this year, the former General CEO of China, Murphy, took over the "Baton" from Guo Qian and officially served as CEO of Guanzhi Auto. At the same time, he once served as a "marketing expert" for executives in Shanghai GM and PSA Peugeot Citroen. Sun Xiaodong also joined Guan Zhi as the executive vice president of sales and marketing of Guanzhi Auto. Until March of this year, Ling Hai, former director of public relations for Shanghai GM Chevrolet, also confirmed that he has joined Cheetah Automotive and is responsible for the expansion and optimization of dealer networks. Immediately afterwards, former Shanghai General Public Relations Division Xu Wan also joined Guan Zhi Automotive as the director of public relations for the marketing and sales department.

The ubiquitous "universal system" atmosphere quickly spreads throughout the interior of Guanzhi Automobile, and the exchange of blood in important departments is bound to bring new DNA of Guanzhi Automobile.

In 2014, after the introduction of three products in the market – the Kuanzhi 3, the Guanzhi 35 doors and the Qoros 3 City SUVs, Qoros sold less than 7,000 vehicles in the year. Because of this, after the new team led by Murphy took office, he began to expect to create a "new vision" to reverse the status quo. In this regard, finding a more pragmatic product positioning and marketing route for Guanzhi Automobile is obviously a top priority.

According to the reporter’s understanding, in September last year, Qoros Automotive developed a new business plan. Compared with the previous business plan, sales volume in this new business plan is expected to be lowered. This is also mentioned in the 2014 annual report of the Israeli group. On May 5, a source close to observation revealed to this reporter that “this plan is indeed a new overall strategic plan for the automotive industry in the next 3 to 5 years, but with the change of the senior team of Guanzhi, The original plan is likely to be reset."

According to the information disclosed by Israel Group's 2014 financial report, as of December 31, 2014, Qoros Automobile still had RMB 824 million in loan quota not yet used. In addition, Qoros plans to refinance most of its short-term borrowings in 2015. "In 2015, we plan to add 800 million yuan in new shareholders' loans. In February 2015, Guanzhi had received 400 million yuan, and an additional 400 million yuan is expected to be received in the second quarter of 2015." Israel Group Financial Reports disclosed.

“Cash flows are generated in time to offset the liabilities.” When referring to improving the financial situation in 2015, Guanzhi expressed in the annual report. The availability of more than RMB 1.6 billion in loan funds in mid-2015 also provided sufficient material protection for the new concept team to flex its muscles.

How to re-create concept? How to quickly achieve hematopoietic function? The challenge of the new concept team began.