Honda Automobile Honda Acquires 1.2 Billion to Acquire Honda China Experts Says to Increase Production Capacity and Exports

Recently, Jin Hao was informed by the Guangzhou Automobile Group official that Guangzhou Auto Group Co., Ltd. type reviewed and approved the "Proposal for Transferring 25% Equity Interest in Honda (China) and Guangqi Honda's Plan to Acquire and Restructure Honda (China)" and approved Guangzhou Automobile Honda Automobile Co., Ltd. Acquired 100% equity of Honda Automobile (China) Co., Ltd. The total planned investment is 1.206 billion yuan.

In fact, this year, Guangqi Honda's sales figures are really eye-catching. So why did you propose to invest 1.2 billion at this time to acquire Honda China? Cui Dongshu, Secretary-General of the National Association of Travel Unions, said in an interview with Daoge that he said: "Guangzhou Honda's capacity is not very abundant, so it is necessary to acquire Honda China's production capacity in China." So, Guangzhou Automobile Honda's production capacity is incommensurable with the Guangzhou Automobile Honda Rapidly growing sales?

Invested 1.2 Billion Guangqi Honda Acquired Honda China

According to official data, the board of directors of Guangzhou Auto Group Co., Ltd. agreed to transfer 25% of the shares of Honda Motors (China) Co., Ltd. held by the company through the open market. The base price for the transfer of listing is approximately RMB 231.593 million. Based on the results of the filed asset assessment report, it is based on the results.

After agreeing to obtain approval from the relevant authorities, the company’s joint venture, GAC Honda Automobile Co., Ltd. was approved to acquire 100% equity of Honda Automobile (China) Co., Ltd. through open market transfer and agreement and to upgrade and upgrade.

It is worth noting that the project plans to invest a total of 1,206.14 million yuan, the source of funding for the company to solve their own funds. 1.2 billion is not a small number, and the acquisition of funds will be entirely funded by companies themselves. Is it too stressful?

In fact, according to Jinhao, the operating income of Guangzhou Automobile Honda for the period from January to June this year has reached 41.27 billion yuan, an increase of 30.44% year-on-year. Net profit attributable to the listed parent company increased to 3.286 billion yuan. So this 1.2 billion is actually not too much pressure for Guangzhou Automobile Honda.

However, why does Guangqi Honda spend a lot of money to acquire Honda China?

Eye-catching sales data requires strong production capacity to support

In fact, this is related to the sales figures and outstanding market performance of Guangqi Honda this year. Since the beginning of this year, sales of Guangzhou Automobile Honda have soared. According to the latest data, sales of various models of GAC Honda continued to increase in November, and terminal sales once again set a new monthly sales record for this year, capturing 73,440 units, an increase of 9.5% year-on-year, of which five models sold over 10,000 terminals. So far, Guangzhou Automobile Honda 1 - November cumulative sales of 663,553 units, an increase of 10.6% year-on-year, has exceeded the 2016 annual sales. Among them, Guangzhou Honda reached 649,448 and Guangzhou Automobile Acura reached 14,105. Up to now, Guangzhou Automobile Honda has completed 95.7% of the annual target of 690,000 vehicles. It can be said that the sales target for this year has been pinned.

The rapid growth of sales requires strong production capacity to support. Cui Dongshu, the secretary-general of the CLUCC National Committee, said in an interview with Daoge’s car: “Guangzhou Honda's production capacity is not very abundant, so it is necessary to acquire the production capacity of Honda China in China.”

It is understood that currently Guangzhou Automobile Honda has three production lines with an annual production capacity of 600,000 vehicles. The first production line is located in the Huangpu plant area with a designed capacity of 240,000 units; the second and third production lines are located in the Zengcheng plant, with an existing production capacity of 240,000 vehicles/120,000 vehicles. The third production line will add 120,000 capacity in the future, forming a total capacity of 720,000 units/year of Guangqi Honda.

Obviously, the total production capacity of 720,000 vehicles/year does not meet the current rapid development of Guangzhou Automobile Honda. Therefore, Guangzhou Automobile Honda needs to expand its channels to increase production capacity to cope with outstanding market performance. It is understood that Honda China has its own production line in the Guangzhou Free Trade Zone and is dedicated to exporting production capacity. Obviously, this production line is the most suitable expansion capacity for GAC Honda. After all, whether it is from technology or product planning and development strategy, Guangzhou Automobile Honda can do a very good communication and development with Honda China, mutual benefit and win-win situation.

After all the joy of light sadness

In addition, for the acquisition, Mr. Cui Dongshu also expressed his regret during an interview with Dao Dao’s vehicle. “The acquisition is mainly focused on the domestic market, so the export will be weakened. However, we The export market itself is not doing well enough, and our export competitiveness is not very strong. Therefore, focusing on the domestic market is also a very pity thing. We want to encourage them to export more.”

After talking about the beneficial aspects of Honda China's business in China after the acquisition, it said: “One of the issues faced by this acquisition is how to have greater exports. We don’t need Honda to put it in China. The customer business is doing too strong, but hopes that his export and domestic development will be balanced and balanced.”

In fact, as Mr. Cui Dongshu said, Guangzhou Automobile’s Honda is currently mainly targeting the domestic market.

Honda Motors owns Honda, Acura and the concept of three major brands, which is also the future of the company will jointly develop these three brands. Since Acura settled in Guangqi Honda and launched the first domestic model, the CDX, the Acura brand officially opened its localization process in China. Its second domestic model, the TLX-L, has also been released and announced a pre-sale price of no more than 280,000 yuan. This vehicle is designed for Chinese consumers to be lengthened and is expected to effectively enhance the performance of Acura in the Chinese market. .

From all this, we can see that in the future, the focus of Guangqi Honda's more market is still on the domestic market. How to make exports and domestically balanced and balanced development is a key issue that Guangqi Honda will face after its acquisition.