editor 
April seventeenthBradowenpoker, the tide of universal money (000559Bradowenpoker.SZ) announcement to purchase WanxiangAmericaCorp of Wanxiang Group, the controlling shareholder, by issuing shares and paying cashBradowenpoker.100% equity. The operation of the "universal system" from around to the right hand has quickly attracted attention. Since the performance peak in 2017, the profitability of Wanxiang Qian Chao has gone down, and the report in the third quarter of 2023 also showed a double decline in its profits. but Wanxiang Qian Chao is still trying to pay for the "car-building dream".
With the death of Lu Guanqiu, founder of Wanxiang Group in 2017, his son Lu Weiding shouldered an important task, but in recent years, the performance of companies owned by Wanxiang system has stalled and life has become more and more difficult under pressure.
"Universal system" left hand upside down right hand?
According to the Wanxiang US website, the company is a wholly owned subsidiary of Wanxiang Group Co., Ltd., which was established in 1993. Wanxiang Group established an American company to establish and expand automotive and other industrial customers in North America, South America and Europe. At present, Wanxiang USA has completed the acquisition of more than 10 American companies.
According to public information, since 1998, Wanxiang USA, which relies on Wanxiang Group, has frequently won US assets, including QA1, UAI, GBC, the oldest bearing manufacturer in the United States, DANA, the world's largest transmission system manufacturer, A123Systems, an American battery company, and BPI, a brake parts manufacturer in the United States.
It is worth mentioning that Ni Bin, the son-in-law of Lu Guanqiu, founder of Wanxiang Group, has always been responsible for the expansion of Wanxiang in the United States, and the acquisition of Wanxiang American company seems to have laid the groundwork as early as two years ago. On March 29, 2022, Ni Ben, who has long-term residency in the United States and is now a senior executive vice president of Wanxiang Group, general manager of Wanxiang USA, vice chairman of Wanxiang Qianchao, and director of Wanxiang 123, became chairman and financial director of Wanxiang Qianchao.
The dream of building a car by "Universal system" is not over.
Wanxiang Qianchao is the listed company platform of Wanxiang Group's main auto parts business plate, which mainly produces automotive parts and assemblies such as chassis and suspension system, automobile braking traditional system, etc. The company not only supplies to the main domestic vehicle enterprises, but also supports GM, Ford, Volkswagen and other international vehicle enterprises, and the market share of the leading products has reached 12%. As of the first three quarters of 2023, Wanxiang Group held a 63.97% stake in listed companies.
Speaking of, Wanxiang Group began to lay out the field of new energy vehicles a long time ago. In 1999, Wanxiang Group set up an electric vehicle project preparation team, and then acquired battery companies and electric vehicle manufacturer Fisco one after another, and renamed it Karma to distribute the American market. In China, Wanxiang Group announced in 2016 that it would invest 200 billion yuan in 5-7 years to build a Wanxiang innovative energy gathering city, focusing on developing new energy components, batteries, passenger cars and passenger cars. However, whether it is Karma or Ju Neng City, the progress of the project is not satisfactory. Obviously, Wanxiang Group "got up early in the morning, but caught up with the evening collection" in the field of automobile manufacturing.
The tide of Wanxiang money was also expected to be a key link in the realization of Wanxiang's dream of building a car. However, with the rapid development of new energy vehicle market, the tide of Wanxiang money seems to be inadequate. In 2017, Wanxiang Qian Chao made a net profit of 924 million yuan on a revenue of only 11.154 billion yuan, but then its profitability entered the downward channel. Although the revenue reached a new high of 14.322 billion yuan in 2021, the company's net profit was only 701 million yuan.
At present, the performance of Wanxiang Qian Tide in 2023 still seems to have not improved. In the first three quarters of 2023, the company's revenue was 11.084 billion yuan, down 0.23% from the same period last year; net profit was 611 million yuan, down 2.16% from the same period last year.
In addition, Wanxiang Qian Chao also tries to cultivate other platforms of listed companies related to car building. Wanxiang 123 is an equity investment enterprise focused on the layout of Wanxiang Qian Chao in 2022, and the listed company currently holds 10.738% of its shares. As an important layout of Wanxiang Group in the field of power batteries, it has so far failed to achieve stable profits. In 2022, Wanxiang 123 realized operating income of 2.197 billion yuan and net profit of 260 million yuan, mainly investment income. The profit of the main business was greatly improved, but there was no profit. Although the performance continues to improve in 2023, and both operating income and profit are expected to grow, since the launch of IPO tutoring in October 2021, the progress of the listing of Wanxiang 123 has been slow and uncertain.
"if my generation will not succeed, my son will continue; if my son will not succeed, my grandson will continue." this is the promise made by Lu Guanqiu, founder of the Universal system, to his dream of building a car. However, with the death of Lu Guanqiu in 2017, his son Lu Weiding shouldered an important task, but in recent years, the performance of companies owned by the Universal system has stalled and life has become more and more difficult under pressure.
Braving the wind and waves of the "universal system"
Born in 1994, Lu Guanqiu started his own business in 1962 and founded Wanxiang in 1969. After 55 years of development, after two generations of Lu's father and son management, it has developed into a huge empire including automobile, new energy, agriculture, real estate, finance and so on.
At present, the "universal system" mainly has two main bodies, one is Wanxiang Group, the other is Wanxiang Holdings, the former focuses on industry, the latter focuses on finance. Among them, Wanxiang Group mainly distributes automotive, new energy and other fields, holding two listed companies, Wanxiang Qianchao and Shunfa Hengye, as well as Wanxiang 123, Shanghai Jiexin Power Battery system Co., Ltd., Wanxiang Electric vehicles and other companies. The other two listed companies, Chengde Lulu, Wanxiang Denong, and the Dayang family terminated by IPO, are controlled by Lu Weiding, the son of Lu Guanqiu, through the Lu Guanqiu San Nong Fuzhi Fund.
In addition, Wanxiang Holdings is the financial holding platform of "Universal system", and its main assets include Minsheng Life Insurance, Wanxiang Trust, Wanxiang Leasing, Tonghui Futures (formerly Wanxiang Futures) and so on.
In 1992, the 21-year-old Lu Weiding stepped into the position of vice president of Wanxiang Group, and the story of the second generation of "Universal system" was going on. It was not until October 2017, when a generation of capital tycoon Lu Guanqiu died, that Lu Weiding began to take over the huge capital empire of the universal system.
Unlike his father's industrial efforts to build Wanxiang empire, Lu Weiding seems to prefer capital operation, through the establishment of Wanxiang Holdings layout of the financial sector, involving insurance, banking, trust, futures, funds and other fields. In 2023, the Lu Weiding family had a wealth of 44 billion yuan.
However, the life of the "universal system" is not easy. The four listed companies under the "universal system" have stalled in recent years, and the development of financial business has also suffered major setbacks.
Among the three listed companies besides Wanxiang money tide, Shunfa Hengye, the real estate company with the largest revenue, has been declining since its revenue reached 6.682 billion yuan in 2017, except that its net profit reached 1.105 billion yuan in 2018. Shunfa Hengye's net profit is declining year by year, and is expected to reach 291 million yuan to 370 million yuan in 2023. However, the performance of Chengde Lulu in the food field fluctuates and develops slowly, and the company's revenue has failed to exceed 3 billion yuan in the past decade. The scale of Wanxiang Denong in agriculture is relatively small, and its development is hindered. The company's revenue of 319 million yuan in 2023 is even less than that of 609 million yuan in 2006, and its net profit is difficult to break through 100 million yuan for many years.
At the same time, the Wanxiang trust controlled by Lu Weiding is also in crisis. In the early years, Wanxiang Trust's investment in real estate was extremely rapid, and this operation was regulated and interviewed, and even if it was later reined in, the bitter fruit was finally tasted by Wanxiang Trust at the end of last year. With the downturn of the real estate industry, the problems of Wanxiang Trust have been exposed again, and a number of products have defaulted.
With the emergence of a series of business difficulties, from the lost road of car manufacturing to the risks of the financial sector, the capital ship of "universal system" seems to need to "ride the wind and waves" again.
(article sourceBradowenpoker: blue Whale Finance)