2003: Starting with Foreign Trade

Chapter 627 "A Depletion of Talent"

"It doesn't matter. If they want to dilute our shares through a share issuance, we'll just find an opportunity to sell our shares. We won't lose money either way."

This was originally a game of chance; it would be great to acquire Huanghai Auto at a cheap price, but it wouldn't matter if we couldn't.

Of course, even if he couldn't win the bid, Tan Jincheng would do everything he could to sabotage Huanghai Automobile's bus business in Changzhou.

Investing in a joint venture car factory—only I can make that money.

This is strength.

By acquiring Huanghai Auto, Weilai Auto will also be able to secure most of the bus business in Beicang and even Ningbo. The price of a typical bus in the city ranges from approximately 30 to 150 million yuan.

Based on a minimum selling price of 30 yuan, selling 1000 vehicles a year would generate 3 million yuan in revenue.

To produce 1000 buses, you only need to secure partial bus procurement contracts in a few cities to achieve this easily.

For Shuguang Auto, this was an unequal hunt. Although they were angry, they didn't have any good solutions. When ByteDance's stock price was low and its shareholding exceeded 5%, things were already difficult to control.

Tan Jincheng's strategy is similar to that of Bao Neng in his previous venture into Vanke, where the shareholding was extremely dispersed and the stock price had been depressed for a long time, allowing him to quickly acquire shares before the other party could react.

Applying the capital strategies of 2015 to listed companies in 2008, when the domestic capital market was still underdeveloped, was like a game-changer.

Let alone an old-fashioned company like Shuguang, even Vanke was completely stunned by the beating back then.

Time is running out for Shuguang Auto. If ByteDance makes a second takeover bid, it will trigger a chain reaction. With the stock price continuing to rise, the shares of Shuguang Auto, which are mainly held by individual shareholders, will quickly be concentrated in the hands of Tan Jincheng.

If you were to say how dispersed Shuguang Auto's shares are, even including Tan Jincheng, the top ten shareholders only account for 30% of the total, which puts the management in an extremely passive position.

If Tan Jincheng's initial target hadn't been Changfeng Group, acquiring Shuguang Auto would indeed have been a great idea.

It was only after learning about the changes in the secondary market and understanding the industrial structure of Shuguang Auto that Yu Changze realized that Tan Jincheng had another intention in placing the joint venture factory in Changzhou.

Yu Nagasawa, being new to the company, may not be familiar with the survival environment of large and medium-sized bus companies in China, but that doesn't mean the others in the Mitsubishi team are unaware that these products are not aimed at ordinary consumers and actually follow the government procurement route.

At most, they could add some travel companies, and a company could live comfortably selling a few hundred cars a year. What could Shuguang Auto possibly have that Tan Jincheng would be interested in, besides Huanghai Auto? Chang Zeyu couldn't think of anything else.

Parts suppliers? There's no need. With the excellent automotive supply chain in the Yangtze River Delta, there's absolutely no need to source parts from Northeast China.

His words just now were actually intentional.

Tan Jincheng's decision to delegate authority over the joint venture's operations greatly benefited Mitsubishi and himself, and as a new leader, he needed to achieve results.

In return, he respected Tan Jincheng's wishes regarding the location of the new joint venture factory, and the two cities Tan Jincheng chose were indeed excellent, which Mitsubishi could not fault.

However, when he discovers that Tan Jincheng has other intentions, he will remind him of something, as a way of doing him a favor.

Negotiations with Shuguang Auto are still ongoing. The sale of assets by listed companies requires approval from the China Securities Regulatory Commission (CSRC), especially for those involving shareholding disclosures, which won't be easy to obtain in the short term.

Besides the 8.2% held by ByteDance, the trust fund controlled by Gu Qingqing was also quietly buying in before and after the negotiations began, keeping the amount purchased within 1.8%.

With a two-pronged approach, Tan Jincheng would swiftly raise his paddle again if negotiations broke down, giving the other side no chance to react.

I don't believe they won't panic once they hold more than 10% of the shares.

The initiative is already in Tan Jincheng's hands; no matter what, based on the current market value, this stock won't lose money.

The cost of buying Juxing Engine was around 6.2 yuan. After today's closing, the stock price of Shuguang Auto reached 7.38 yuan, which is nearly 20% profit margin.

From an investment perspective, ByteDance's advertising platform, Ocean Engine, has already made a profit.

The negotiations with Changzhou went smoothly. The other party offered so many preferential policies. Regardless of how much will actually be implemented in the end, it at least shows their sincerity. The two parties initially signed a cooperation agreement.

"It's like dating. At the beginning, everything sounds wonderful, but in the end, it all depends on your character."

The land cost will be fully refunded, tax exemption will be granted for 3 years, tax incentives will be provided after 3 years, and normal tax policies will be restored in the 6th year. Low-interest loans of 30 billion yuan will be provided to Weilai Automobile and Mitsubishi Group respectively.

These few preferential policies alone are dazzling; they've really gone all out.

Zhang Yong expressed doubt about how much of these preferential policies could actually be implemented, but Tan Jincheng's way of describing it was quite unique.

We can deal with the future later; it's better than having nothing at all.

The joint venture factory was ultimately decided to be located in Wujin District, covering an area of ​​750 acres. Like the Beicang manufacturing base, it is designed as a smart factory according to the highest current standards and is expected to create 2000 jobs.

The main model produced at the Beicang manufacturing base is the Outlander, while the main model produced at the Changzhou manufacturing base is the ASX. Both manufacturing bases are planned to be completed within 18 months, meaning they must be operational by the end of 2010 – a very tight timeframe.

This timeframe was set by Mitsubishi.

Wei Lai wasn't in such a hurry. The manufacturing base in Xiangcheng was almost finished with renovations, and the manufacturing base in Beicang would also be able to start production this year. Whether the joint venture factory was six months earlier or later was not a problem.

But Mitsubishi couldn't wait; if possible, they would love to start production tomorrow.

The 4 trillion yuan stimulus plan prioritizes the automotive industry chain, and Mitsubishi anticipated the intense competition in the future market, knowing that delaying even a day would mean losing a crucial advantage.

Yu Nagasawa is under a lot of pressure.

He was appointed to this critical position in a time of crisis. The market share of the complete vehicle market was precarious, and many Chinese companies already had the ability to develop their own engines, so engines were not selling as well.

If things continue like this, we'll eventually have to withdraw from such a huge market.

From a personal perspective, Tan Jincheng was very grateful that he relinquished the operating rights of the joint venture, as this was very helpful to his career.

Other joint ventures don't receive this treatment.

Friday, September 3st.

After a week of negotiations, Changzhou, Weilai, and Mitsubishi jointly held a grand signing ceremony.

Those attending the meeting were all members of the Changzhou team. Mitsubishi also sent senior executives led by Yu Nagasawa. As for Weilai Motors, their presence was rather meager. Weilai Motors, which was short of talent, only had Tan Jincheng, Zhang Yong, and their assistants attending.

"We're still short-handed. Lao Zhang, could you recruit some more talent? We can discuss the terms."

Tan Jincheng sighed, "The Mitsubishi delegation, whether in terms of management or technical personnel, is several levels above Flash."

Zhang Yong chuckled: "Boss, don't you like poaching people? Why don't you poach some from Mitsubishi?"

Sure enough, Tan Jincheng, whose eyes were darting around, was actually thinking about this, looking for a good way to poach some people from Mitsubishi.

"Hehe, that's easy to say, but you should also use your connections to bring us a few more top talents. Our company is facing a severe shortage of talent."

How did Geely develop like this? It seems like they recruited talent from Europe, like designers from BMW and Mercedes-Benz?
Zhang Yong curled his lip, already knowing what kind of crooked idea his boss was up to. Everyone in the business circle said he was a scoundrel, and it was indeed true.

Even though the boss has already toned it down quite a bit.

"Indeed, our company is short-staffed right now. I'll see if I can get some people over here."

Zhang Yong is also having some headaches about the lack of manpower. Currently, he needs to personally handle many things. He is either on a business trip or on his way to a business trip all year round, and he goes to bed very late every night.

Even with all that, they were still too busy, and Flash Group helped them with many things.

That is, at 5 PM today, FlashTech issued five announcements in a row: the annual report, the annual report summary, the announcement of the annual profit distribution plan, and the announcement from the accounting firm.

All four reports relate to FlashTech's 2008 annual report, showing annual sales of 183.54 million vehicles, sales figures of 32.77 billion yuan, a growth rate of 23.95%, and profits of 6.248 million yuan.

A row of impressive data points, along with a series of operational data.

Compared to the previous annual report preview, this audited annual report is the most attractive, as FlashTech's comprehensive operating data appears in the public eye for the first time.

"Holy crap, so little inventory? And such short payment terms, is the electric vehicle business really that lucrative?"

"It's true that East China and Central China are the best-selling regions."

"What the heck? Electric tricycles only account for 6.82% of total revenue, but the gross profit is so high? Aren't these things sold to rural areas?"

Looking at the annual report alone, FlashTech's annual report is really impressive. Anyone can see how profitable electric vehicles are. FlashTech's debt ratio is only 45.79%, and its annual operating cash flow is as high as 6.5 million yuan.

With such a low debt ratio, such high cash flow, and short payment terms, it's no wonder that there are now more than 2000 electric vehicle brands in China.

This is a sunrise industry.

What excited everyone the most was the announcement of the expected increase in profits for the first quarter of 2009, released at the same time as the annual report!

Annual reports are from the previous year and can only prove that the company was once glorious, while quarterly reports are a real reflection of this year's performance. Although the first quarter is the off-season for electric vehicle sales, it is still possible to compare the sales volume of the first quarter of last year and predict how many electric vehicles FlashTech can sell this year!

(End of this chapter)