The meaning of Yin Tongyue's statement of "doing it by oneself" is that it offers the possibility of being strong and making differences.

“We may still be focusing on ourselves.” Yin Tongyue, general manager of Chery Automobile, has recently put a stop to the rumors of international mergers and acquisitions and domestic “Love of Qijiang”. In the same time that the auto industry's reorganization plan is catching up with the trend and the capacity expansion impulse is unbearable, this attitude of active cooling should be worth applauding.

Yin Tongyue stated at the 2009 International Forum on Automobile Industry Development that after terminating the negotiations with Fiat and Chrysler, Chery will focus on "doing it by oneself," not refusing to cooperate, or pursuing cooperation, but there are no partners currently negotiating. When talking about whether or not to acquire Volvo, Yoon said: "We can't do anything about companies that have a large monthly loss." As for the restructuring of Jianghuai Automobile, Yin also said directly that "this thing does not exist." There is only some technical cooperation between the two parties.

Chery’s attitude towards Volvo sales and “Love in the Qijiang” is particularly noteworthy. Geely’s rumors of Volvo’s acquisition of Volvo have been hotter recently and confirmed by the official Geely’s for the first time. However, Volvo's bid of 16 billion to 20 billion yuan, which car prices in China can afford, even if the joint investment institutions, how to control in the future. Yin Tongyue feels more about this kind of acquisition legal issues, so he still works better.

In terms of domestic restructuring, Chery has been clearly listed as one of the "four smalls" by the state plan. Compared with other companies, Chery's mergers and acquisitions resources are indeed relatively small. But this does not mean that Chery must reorganize with JAC. Previously, the analysis logic in the industry was that Chery Jianghuai was a state-owned enterprise in Anhui Province, and the resistance to merger under the government's support was relatively small, and both had expertise in passenger vehicles and commercial vehicles, and the products were complementary. However, in fact, Chery has been planning to enter the hinterland of Henan Province to develop micro-vehicles and commercial vehicles in the hinterland of Henan. The passenger car projects in Jianghuai have also progressed rapidly. The complementarity of reorganization has been weakened, and the reluctant merger will cause waste of resources. Moreover, Yin Tongyue said that there is no department in Anhui Province that requires the merger of the two. If this is true, Anhui’s pragmatic attitude is worthy of recognition.

Domestic restructuring is good, international mergers and acquisitions are also good, all are well-developed companies to expand. The main motivating factor is that the state encourages the consolidation of two or three large-scale automobile enterprises with production and sales volume of 2 million vehicles within a few years. Some state-owned enterprises are therefore particularly active in mergers and acquisitions. However, the hot car market now needs cold thinking.

It is somewhat ironic that so many automobile companies in China are, in fact, basically the face of a different international joint venture. The automobile industry does need to be integrated, but with rigid scale targets as its appeal, it can only create a few "large" companies. If BAIC expands successfully, it will become another FAW. In international mergers and acquisitions, the mentality of the participants to “get bigger” is also very clear. The experience of losers shows that there is actually no shortcut to being big. The only shortcut is to be strong first.

The meaning of Yin Tongyue's statement of "doing it by oneself" is that it offers the possibility of being strong and making differences. However, under the reorganization trend, how long can Chery “keep doing it”?

View related topics: China's auto industry recommence mergers and acquisitions wave


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