On March 8, 2011, Yaxing Bus issued an announcement: Weichai Motor Group Co., Ltd. (hereinafter referred to as “Weichai Yangzhou”) was acquired by Weichai (Yangzhou) Yaxing Automobile Co., Ltd. for free at Jiangsu Yaxing Automobile Group Co., Ltd. (hereinafter referred to as "Yaxing Group" holds a 51% stake in the company and becomes the actual controller of the company.

“Compared to Zhongtong Bus, Yaxing Bus has not performed well in recent years. Local governments have a reorganization intention and the acquisition conditions are relatively low. Therefore, Weichai eventually chose Yaxing as a springboard for entering the passenger car industry.” One would not disclose. The insider of the name told reporters.

As early as the end of last year, the news that Weichai Group intended to acquire Zhongtong and reorganize Yaxing was also circulated at the same time. At that time, Zhongtong Bus clearly stated to the outside world that it had never had any contact with Weichai in connection with the acquisition. This position surprised Weixiang.

In Yangzhou, Jiangsu, the restructuring of Weichai Group and Yaxing Bus has progressed rapidly. On November 2, 2010, the announcement of Yaxing Bus disclosed that the company's controlling shareholder, Yaxing Group, intends to transfer 53.71% of its shares held by the company to all subsidiaries of Shandong Heavy Industry Group Co., Ltd. without compensation.

After the announcement, informed sources immediately guessed that the “directly affiliated company” mentioned in the announcement is likely to be the strongest Weichai group under Shandong Heavy Industries. Yaxing's share price also soared at the end of last year, due to its implied reorganization.

“Actually, Weichai chose Yaxing not only because of its strong intention to reorganize, but also because of the rich human resources behind it. Yaxing has experience with Mercedes-Benz, and it has other models in addition to passenger cars. For Weichai to enter the vehicle field and open up and down the road to provide a broader space for development.” Informed sources told reporters.

Shandong Heavy Industry added another pawn

In order to cultivate 8-10 large-scale and competitive enterprise groups, by 2011 two car companies with sales revenues of more than one hundred billion yuan will be formed. Since 2009, the Shandong provincial government has started to reorganize the automobile companies in the province. At work, the birth of Shandong Heavy Industry is one-handed planning.

On June 16, 2009, Shandong Heavy Industry Group Co., Ltd., consisting of four state-owned enterprises, including Weichai Group and Shandong Engineering Machinery Group Co., Ltd., was registered and established. Tan Xuguang, chairman of Weichai Group, became the company's chairman and party committee secretary.

In order to complete the tasks assigned by the government and achieve a new takeoff of the enterprise, Tan Xuguang, who had a new title, once faced more than 2,000 dealer representatives in the Shandong auditorium in Jinan in December 2009: “Three to five years later, We will enter the 100 billion-dollar Global Heavy Industry Group Club."

In fact, when Tan Xuguang issued this statement, Weichai's expansion strategy has already started.

In November 2009, Weichai and the Yangzhou City Government signed a strategic cooperation agreement. The content of the agreement is roughly that, within the next five years, Weichai Group will invest more than 2 billion yuan to increase investment in the diesel engine business, new energy passenger bus business, special vehicle business and other auto parts business, and the industrial scale will exceed 10 billion yuan. By then, Yangzhou will become Weichai Group's manufacturing center in the Yangtze River Delta region.

In this agreement, Yangchai Company and Yaxing Bus are important pieces for realizing the strategic layout of both parties. The agreement has described the future of the two companies as follows: The reorganized Yangchai Company will strive to realize the production and sales of 300,000 light engines within five years and the ability to produce 500,000 units per year within five years; the reorganized Yaxing Bus will strive to form an early stage. More than 10,000 units of vehicle production scale, focusing on the development of new energy, new fuel buses.

A few days after the signing of this agreement, Weichai Group will share its revenue with Yaxing, under the same group as Yaxing. Since then, rumors about the acquisition of Yaxing by Weichai have been repeatedly mentioned in the workshop. In 2010, Yaxing's share price also fluctuates in rumors.

Has become a "chicken rib" Yaxing

Founded in 1995, Jiangsu Yaxing Bus Group Co., Ltd. is one of the earliest manufacturers of passenger cars in China. Its predecessor, Jiangsu Yangzhou Bus Manufacturing Plant, is a large-scale backbone enterprise that produces road buses in the country and has an annual output of 7,000 vehicles. The capacity of 12,000 chassis has once occupied a leading position in the domestic passenger car industry.

A series of glorious figures have been recorded in the history of the development of Yaxing Bus: The first bus-only chassis, the first in China to produce chassis through independent development.

The manufacturer of complete vehicles, the first domestic passenger car company to exceed 5,000 sales figures, has been the nation’s No. 1 seller for seven consecutive years...

However, the splendor of Yaxing came to an abrupt end by the end of 2003. From the end of 2003 to the fourth year of 2006, Gu Chujun, the head of Greencool, entered the company, and then Yangzhou SASAC bought back equity. During this period, the sales of Yaxing Buses plummeted. Data show that in 2009 Yaxing bus loss of about 96.34 million yuan.

Yaxing Group insiders once admitted to the media that Yaxing, a subsidiary of the Yangzhou State-owned Assets Supervision and Administration Commission, has suffered major setbacks. Therefore, it has become more cautious in its strategic choices. This has indirectly led to slower vehicle updates and can not keep up with the market. Difficult to boost, corporate personnel flow frequently.

In particular, the strategic cooperation between Yaxing and Mercedes-Benz, due to high product positioning and a certain gap with the mainstream market, has missed some good market development opportunities. After that, the cooperation with Kelon Group also failed.

This series of crackdowns has gradually made Asian Star Buses marginalized. In order to completely get rid of the shadow of Greencool, the Yangzhou City Government has been trying to adopt various means including the transfer of equity, hoping that Yaxing Bus will regain its new life. The industry believes that in the eyes of the Yangzhou City Government, Yaxing Bus may already be a “chicken rib”.

In 2009, the emergence of Shandong Heavy Industry made the Yangzhou City Government see a breakthrough opportunity.

Yaxing's springboard function

Following the acquisition of Shaanxi Heavy Duty Truck and Chongqing Chuanjiang Automobile, Weichai has hired Yaxing Bus to the next place and is considered by the industry as an important step in its entry into the vehicle field.

“In fact, Shaanxi Automobile has always been reluctant to be controlled by Weichai. There is always an idea to get rid of Weichai, and Chuanjiang Automobile is not known in the field of passenger cars. Therefore, the acquisition of Yaxing is an entry into the vehicle market for Weichai. A key step in the downstream.” A securities analyst who looks at the world told reporters.

Judging from the industrial layout, Weichai's acquisition of Yaxing Bus can deepen its vehicle system segment with commercial vehicles as the core, and complete the strategic layout of Shandong, Chongqing (Southwest), Shaanxi (Northwest), and Jiangsu and Zhejiang from the regional layout. The resources owned by Yaxing Bus itself can provide more development imagination for Weichai.

"Yaxing has experience with Mercedes-Benz. Weichai can use Yaxing to establish links with Mercedes-Benz and seek better resources for business development. In addition, Yaxing's car production qualification is very comprehensive. Almost all cars except cars can be produced. This kind of car provides ample space for Weichai to enter the vehicle sector, said an informed source.

According to the official data of Yaxing, Jinchangshan, the chairman of Yaxing Group, once proposed at an internal company meeting in 2010 that it plans to invest 800 million yuan to start the research and development of micro-substances, MPVs, and SUVs from 2011. Foreshadowing into the field of passenger cars.

After Weichai purchased Yangchai, it introduced the light diesel engine technology and products of Italian VM Company to build a new R&D platform. According to the plan, the products developed on the new platform will be put into production on a large scale this year, and the possibility of Weichai taking the opportunity to enter the high-end light truck market is not without possibility.

However, the industry is more concerned that Yaxing can enable Weichai to get involved in the emerging field of “new energy vehicles”. In the automobile and motorcycle manufacturing enterprises and product catalogues approved by the Ministry of Industry and Information Technology No. 70 “Notice” of the 201st batch, the new energy products such as the 12m hybrid city bus JS6126GHV, the 12m single-deck and double-deck passenger car hybrid chassis JS6126DGHV are impressive In the column. The new energy theme is undoubtedly another "gold mine" Yaxing developed for Weichai in the capital market.

"Asian Star is like a springboard for Weichai. The latter will use the former to enter a broader space of development," an industry source told reporters.

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