Introduction

Introduction

With the acceleration of a new wave of industrial changes, the pattern of the industry is undergoing differentiation and reorganization, indicating that the pressure of era replacement is far beyond people's imagination.

As new energy opens up a new racetrack, erasing past glories and leaving new possibilities for latecomers. As a result, more and more people are joining in, trying to gain a foothold in the fiercely competitive market.

However, not all entrants can ride the wind and waves and move forward smoothly. Unconsciously, China's auto market has gradually shed its initial immaturity and disorder, completing a transformation in the process of industrial transformation and consumption replacement. It has also exposed the true colors of those enterprises that want to succeed by taking shortcuts.

While strolling around, I stumbled upon a Yuanhang Automobile store in the mall by chance. There were two cars displayed in the store, but no salesperson was present. The thick dust on the car body revealed that the store had obviously been neglected for a long time. Combined with recent news about Yuanhang Automobile, various signs all point to a grim reality: Yuanhang Automobile may be on the brink of bankruptcy.

Recently, there have been rumors that Yuanhang Automobile, one of the emerging domestic new energy vehicle brands, is facing unprecedented operational difficulties, and there are even rumors that it will soon announce bankruptcy. A person claiming to be from Yuanhang Automobile's R&D department revealed that the chassis R&D department is experiencing rapid staff turnover, with only a dozen employees remaining on the job.

The automotive industry is not easy to 'mix' in

In response to this situation, Yuanhang Automobile stated: "The company is undergoing strategic adjustments and is currently in the reorganization phase. It is expected that after a period of adjustment, various businesses will resume normal operations. As a brand under Dayun Group, Yuanhang Automobile has strong support and will not easily go bankrupt. Currently, senior executives and middle management personnel are all maintaining their normal on-the-job status."

On the other hand, insiders from Yuanhang Automobile revealed to reporters that the company is facing financial constraints and is seeking local funding assistance and new financing.

When mentioning Yuanhang Automobile, many people may not be familiar with it, but if we talk about Dayun Group, it is probably more well-known. Yuanhang Automobile is a brand under Dayun Group, which was founded in 1987 as Shanxi Tongda (Group) Co., Ltd. It started its business with motorcycles and became popular nationwide with the slogan "The wind sweeps the world, Dayun motorcycles." At its peak, Dayun Group produced over 1.5 million motorcycles annually.

However, as motorcycle bans began to be implemented in various regions of China, Dayun Group needed to find new growth points. From 2004 to 2010, Dayun Group entered the heavy-duty truck and light truck markets successively and gradually became one of the representatives of private heavy-duty trucks in China. As the trend of new energy gradually emerged, more and more commercial vehicle enterprises began to transform from commercial to passenger vehicles.

In September 2020, the new energy vehicles of Dayun Automobile Co., Ltd. were officially put into production. Two months later, Dayun New Energy launched two new models: the small pure electric SUV Yuehu and the medium-sized pure electric MPV Yuanzhi M1. However, the market performance of these two models was not ideal. According to retail data, the sales of Yuehu and Yuanzhi M1 in the first nine months of this year were 9,428 and 6,205 units, respectively.

To make more achievements in the passenger vehicle market, in August 2022, the new brand Yuanhang Automobile officially debuted at the Chengdu Auto Show and simultaneously released a total of four new models: Yuanhang Y6, Yuanhang Y7, Yuanhang H8, and Yuanhang H9. The last time a new brand brought multiple new models at its debut was when Evergrande Auto, aiming to become a world-class brand, did so.

Yuanhang Automobile carries Dayun Group's new dream of transforming from commercial to passenger vehicles, targeting the high-end luxury new energy vehicle market. The four models it sells are relatively large in size and have high prices, which are far from the perception of ordinary consumers. In the first three quarters of this year, Yuanhang Automobile's cumulative sales were 5,584 units, with an average monthly sales volume of less than 700 units, representing a significant gap compared to industry leaders.

Moreover, in contrast to Evergrande Auto's aggressive advertising campaign at the time, Yuanhang Automobile's marketing investment has been relatively low-key. Apart from placing a small amount of outdoor advertising at locations such as high-speed rail stations and airports, there has been little other promotion. Many consumers only became aware of the brand's existence after seeing Yuanhang Automobile stores in shopping malls.

Industry reshuffling accelerates

As the development of the new energy era enters its second half, a gloom has overshadowed the entire market, ready to eliminate participants who disdain the rules of the game at any time.

Not long ago, Evergrande Auto was petitioned for bankruptcy liquidation. Financial statements revealed that the company generated revenue of 38.38 million yuan in the first half of this year, a decrease of 75.17% compared to the same period last year, primarily due to the sharp decline in sales of the Hengchi 5. In the first half of the year, Evergrande Auto incurred a net loss of 20.256 billion yuan, a significant increase from the 6.873 billion yuan net loss in the same period last year.

Although the official position has not been stated, failure seems inevitable. As of June 30, 2024, Evergrande Auto had total assets of 16.369 billion yuan and total liabilities of 74.35 billion yuan. Recalling that Evergrande Auto officially stated that the Hengchi 5 had received over 37,000 orders in less than 15 days and aimed to "become the strongest new energy vehicle group," these claims now seem like a joke.

With the recent news about Yuanhang Automobile coming to light, people seem to have become accustomed to the survival of the fittest in this industry. However, we must acknowledge that as names like Weima, Leijing, Tianji, and Aichi are etched onto the market's tombstone one after another, what remains are the dregs eliminated during the industry's rapid advancement and the disappointment of consumers.

In fact, Yuanhang Automobile is not the first new-energy vehicle maker to face development difficulties this year. Shortly after the 2024 Spring Festival, when companies were announcing the auspicious beginning of their work year, HiPhi Automobile was rumored to have announced a six-month suspension of production at an internal meeting. Subsequently, rumors of delayed salary payments and across-the-board pay cuts also spread.

During founder Ding Lei's active self-rescue efforts, HiPhi Automobile has repeatedly become the focus of media attention. On one hand, HiPhi employees lamented the difficulties the company has faced in live streaming, garnering considerable sympathy and attention from the outside world. On the other hand, rumors of potential acquisitions frequently surfaced, with giants like Changan and FAW rumored to be assisting HiPhi in its restart.

Furthermore, there were rumors that HiPhi Automobile had signed a "Comprehensive Strategic Cooperation Agreement" with iAuto Group Inc., with iAuto promising to provide the first round of funding for HiPhi's reorganization, aiming to complete the transaction before the release of the first-half financial report in 2024. However, HiPhi did not resume production and ultimately embarked on a pre-restructuring path.

As a result, HiPhi became the first automaker to "exit the group chat" in 2024, but everyone understands that it will not be the only one. Now, with Yuanhang Automobile also appearing on the list, everyone wonders whose name will be etched onto it next?

In today's Chinese auto market, as a new wave of industrial changes accelerates the differentiation and reorganization of the market pattern, the pressure of era replacement far exceeds people's imagination. A brand that was launching new vehicles just a few months ago may suddenly face production suspensions. Therefore, any sign of trouble may be a harbinger of rapid deterioration.

However, it is often said that the internet has no memory. Isn't the ever-changing Chinese auto market, constantly stirred up by the internet, the same? As long as "electronic pickles" continue to emerge in abundance, whether it's HiPhi or Yuanhang, regardless of whether they "die completely" or not, they will gradually be forgotten. Just like previous brands like Weima and Aichi, few people now care about their subsequent development.

At the same time, their demise does not seem to have sounded the alarm for others, as new players are still eager to try. For example, Dreame Tech, which focuses on the smart home appliance industry, has recently revealed plans to enter the automotive industry. However, it is certain that regardless of their initial intentions for entering this field, the market will ultimately judge them based on their strength.