After
filed Lifan cars in the automotive industry can be considered a legendary company, motorcycles huge success from the beginning, began to transition into car field, seemingly bright road but only after a decline of more than ten years later, today, August 6, Lifan Motors Unfortunately issued a notice: the grounds of insolvency, the Chongqing fifth Intermediate people’s Court for justice restructuring. The semi-annual report also showed that in the first half net loss of 2.59 billion yuan Lifan shares, at the same time, * ST shares Lifan also from the highest point in 15 years of 27.07 yuan, fell to 3.74 yuan. What are the reasons behind the decline? Listen to me explain.
motorcycle is the beginning of everything
Lifan motorcycle from family history to begin with, from the motorcycle industry overlord quot; Jialing quot; purchase components developed its own engine, and successfully assembled in just four months, mastered the core technology, at a price of less than 2,000 yuan selling quickly in short supply, and soon after developed China’s first 100ml 4-stroke engine and electric ignition engine, which makes Lifan great success. In 2001, 1.84 million sets of engine sales revenue 3.85 billion yuan, and its own Lifan motorcycle sales in the country also won the second of the good results, from Lifan motorcycle industry has become a well-deserved leader. And also with grades in overseas markets.
hardships of the automotive sector
2003 Lifan announced its entry into a larger market automotive sector, acquired a 80 percent stake in Chongqing Special Purpose Vehicle manufacturer, and renamed Chongqing Lifan Automobile Co., Ltd., oath with Toyota, Volkswagen and other industry overlord of the year competition, but in the car on this road, go Lifan exceptionally smoothly, the official listing of the first car Lifan 520 in 2006, although the configuration is high enough, but only annual sales more than 10,000 units, while over the same period of competing models BYD F3 single-month sales are nearly 1 million units, by contrast Lifan does not recognized by the market.
homogenization of the product is the key to sales growth in the
In the first bogieAfter the hit, the car high design costs and real income gap is too big weight of Lifan find another way out of the situation, followed by homogenization of the design ideas introduced Lifan 320, a move that allowed indeed tasted the sweetness of monthly sales of more than 7,000 units , adhering to this concept, launched more homogenization of cars including Lifan 620, Xuan Long, X80, etc. in subsequent. This approach does reduce the cost of R & D, and product enriched the brand’s product matrix, the sedan, SUV, MPV fully covered, although there is no core competence nor explosion models, but in the year indeed received attention, which makes Lifan automotive in 2010 became the first domestic a-share listed private passenger car business. But this is the beginning of risks.
high failure rate
Lifan crisis in 2015, began to emerge, a Lifan car of the year quot; round out the door quot; awakened the industry and consumers, the rear axle with wheels and exhaust system actually completely separated, reports and this one, the media discovered as early as 13 years, there have been Lifan cars this case; however at this time Lifan is immersed can not extricate themselves 100,000 in performance caused by the homogenization of products in annual sales, while other car companies have found that consumers increasingly for homogeneous products do not agree with, turning to independent research and development on the road. And in the following year Lifan cars to the failure factor 658.2 486.9 much higher than the industry average, car prices in the country ranked fourth from the bottom. Lifan has become a high failure rate indelible shadow.
New Energy longer hit
In fact, Lifan has long been optimistic about the domestic new energy in this area, as early as 2006, many enterprise lift uncertain time, Lifan has been involved in the new energy industry, but got up early, catch the one night set, and even severe blow in 2016, an event suspected cheat up new energy sources, the Ministry of Finance is canceled 2016 central budget subsidies for pre-qualification pull fined over a hundred million.
decline is perhaps to be expected
In early May this year, more than 30 dealers concentrated LifanData center in Chongqing Lifan rights, in fact, this is already the fourth-to-door distributor rights within a month, which represents Lifan really die today, back to the beginning of the article also shows Lifan may never turn around hope, Lifan motorcycle compared to the development process, the failure of the automotive sector, could be expected: homogeneous competition farther and farther on the road, other companies are also tapping into their own core technology and advantage Lifan has not come back to follow the common progress, but immersed in the moment of rising sales in exchange for low-cost, no continuous technology research and development has also led to high failure rate odd, again eroding consumer confidence. With the rapid development of the domestic automobile industry, consumption upgrade, Lifan cars decline is inevitable.
Full Summary
Lifan decline for other car companies play a more warning sense, for businesses and avoid homogeneous competition is essential; pay attention to consumer demand, reduce the failure rate, appear to solve the situation in a timely manner is essential for sustainable development; the important thing is to develop its own core strengths, enhance their brand endorsement, although the investment may not be able to pay off, but in the long run, you want to get the market approval, must be sustained investment and innovation.