Suzuki XiuPinghui Xu Liuping: Promoting "Double Bell" Integration

On September 24, Suzuki Suzuki, president of Suzuki Co., Ltd. came to Chongqing again to talk with Xu Liuping, chairman of Changan Automobile Group. One year later, Suzuki repairs and Xu Liuping secretly talked about the transfer from the Changan Suzuki factory to Changhe Suzuki and Changan Suzuki.

“At present, the integration plan has been submitted to the National Development and Reform Commission for approval. From the process point of view, the pace of integration of 'Double Bell' is likely to be faster than Chang Fuma's branch,” informed sources told reporters.

According to what the reporter had learned, the “Shuang Ling” integration plan is roughly as follows: The future Changhe Suzuki business will be merged into Changan Suzuki, Changhe Suzuki’s brand name will no longer be retained, and the Changan Suzuki brand will be unified; the joint venture will be reorganized after integration. The proportion of the two sides will be adjusted from 50:51 to 51:50; after the completion of the new joint venture merger and equity adjustment, the “three-network consolidation” plan will be implemented at the online sales level, namely Changan Suzuki, Changhe Suzuki and imported Suzuki. All sales networks will be consolidated and the unified policies will be implemented in the future.

The precondition for the implementation of the integration plan is that Suzuki promises Changan that it will no longer seek new joint venture partners within five years.

The Wenchang Chao, the president of the Chang’an Auto Group, who had just taken over the Changhe’s recent arrival, inspected Changhe Motor Co. at the first time.

There is no doubt that, in this brewing integration drama, the biggest victim of interest is Changhe Suzuki. “As far as I know, Changhe Suzuki’s response to the integration of rumors has been very strong.” Relevant sources told reporters that the negative emotions that have caused this have been pushed into Changhe Auto.

After the reorganization of the AVIC Group’s auto assets by the Armed Forces, how Changan reorganized the Changhe and Hafei operations has always been a hot topic of discussion in the media. The reorganization plan between Changan Suzuki and Changhe Suzuki once again caused the potential concerns of Changhe.

“They worry that one day, Changhe Motors will no longer keep its own brand name like Changhe Suzuki.” In addition, after the merger, how will Changhe Suzuki's job placement and personnel placement be adjusted and deployed? Once Changhe Suzuki has been dismantled from Changhe Automotive, how will Changhe Automotive's own business and industry position that has been losing money for years be affected? From this, Lenovo, will the future Hafei business continue the integration of ideas Changhe?

This series of problems is testing the integration wisdom of Changan Automobile Group. “In fact, considering the integration of Changhe Suzuki into the Chang’an system is trying to minimize losses after business adjustment.” Informed sources told reporters that after the integration, Changhe Suzuki’s personnel and product arrangements were not changed except for changes in brand and corporate status. There will be too much adjustment and it will remain the same. Its factory in Nanchang, Jiangxi Province will become the third factory of Changan Suzuki, and the local taxation level will not change much.

However, with the integration of Changhe Suzuki, Changhe Automobile must make a resolution as soon as possible on how to make a substantial change to Changhe Automobile, which is in a loss-making quagmire.

Perhaps in order to appease the internal dissatisfaction of Changhe Automobile, Zou Wenchao, the president of Chang’an Auto Group, who had just taken office, immediately inspected Changhe Motor Company.

During the inspection, Zou Wenchao stressed that China Changan will, as always, support the development of Changhe Automotive in project investment, capital requirements in management, management, and human resources, and will position Changhe Automotive as an energy-saving boutique and fashion cross-border.

According to Chang'an's plan, the product positioning of the three major production bases of Changhe Automobile will be Jingdezhen Base to produce cross-border vehicles and micro-offers; Jiujiang Base will focus on cars and cross-boundary vehicles; Hefei Base will use micro-offers and high-end vehicles. Micro-offers and senior commercial vehicles are the mainstays.

It is worth mentioning that, in order to clarify the importance of this trip to Zou Wenchao in Jiangxi, Changhe Automobile's propaganda department specifically named this corporate news as "China Chang'an Clear "Changhe Brand Positioning to Support Changhe Automotive Development."

1% of the victories and some employees even boldly predicted that "the day of the Chang'an Suzuki Plant II is the time of the merger of the "Double Bell"."

However, Suzuki apparently did not think too much about Changhe Suzuki's sentiments. After the partnership with Volkswagen was lifted, emerging markets including China and India were undoubtedly the top priorities for Suzuki Motor’s future development. Therefore, for Suzuki Motors, integration means speeding up the pace of expansion into the Chinese market and gaining more vehicle sales and profit income. What's more, in this integration plan, Suzuki will be willing to wait for two years. 1% equity.

All changes stem from the unexpected global financial crisis two years ago. In that crisis, Suzuki’s global profits fell sharply. If the emerging markets in India were not strong, it would be difficult for Suzuki to maintain the momentum of continued profitability. Unfortunately, the blowout market in China did not contribute much to Suzuki.

Insufficient investment in the two joint ventures, slow product introduction, and unsuccessful sales channel construction are important reasons for Suzuki's frustration with China. Behind this is the unpleasant feelings that have arisen from instigating Ford, Suzuki and Changan. However, in order to re-force the Chinese market and change the joint venture in China, historical resentment has been left behind by Suzuki.

In 2009, Suzuki and its agent Doosi Co., Ltd. put forward "I hope to increase the stake in Changan Suzuki by 1%." After the plan was put forward, Xu Liuping, chairman of Chang'an Automobile at that time, went to Japan and communicated with Suzuki Hsu about the changes in the equity of Changan Suzuki and the introduction of follow-up products. At this point, Suzuki repair should have no idea that soon afterwards, Changhe Suzuki, another joint venture company in China, will be transferred to the Changan Automobile Group as an automobile asset under China Aviation.

This allowed Suzuki to see another possibility of expanding the Chinese market: to find a new partner through the integration of "double bells." Unfortunately, Suzuki’s plan was broken through by Chang’an at the initial stage, and countermeasures were taken to postpone the integration of the “Double Bell”.

This "no action" attitude on the one hand makes Suzuki's poor business in China worse, and on the other hand it is not conducive to the future development of the Changan Automobile Group. So, at the same time a year ago, Suzuki repaired and participated in the Mayor’s Consultation Meeting in Chongqing to meet with Xu Liuping to restart the Chang’an Suzuki Plant. He hoped to resume good cooperation with Chang’an Automobile and promote the integration of “Double Bell”.

"Actually, the sale of 1% did not lose anything for Changan. Suzuki will, on the contrary, increase the intensity of product introduction and increase the enthusiasm for cooperation. This is exactly what Changan needs." A staff member of Changan Automobile told reporters.

It is understood that this time Suzuki repair again came to Chongqing, in addition to the meeting with Xu Liuping, also focused on inspecting the Changan Suzuki factory. This move was considered by Changan Suzuki to be a positive signal for promoting the integration of the “double bell”. Changan Suzuki employees excitedly rushed in the network. “After the merger, Changan Suzuki can impact the top ten national car sales.” Some employees even boldly predicted that “the day of the Chang’an Suzuki Plant II is the time when the “Double Bell” is merged”.

At present, according to public information, the first phase of Changan Suzuki's second factory in Chongqing will be launched this year.