First, let me clarify. The entity referred to here as China Changan is China Changan Automobile Group Co., Ltd. (abbreviated as China Changan), distinct from the commonly known Changan Automobile, whose full name is Chongqing Changan Automobile Co., Ltd. Both are part of the China South Industries Group Corporation (CSGC). China Changan serves as a secondary group managing CSGC's automotive sector, holding controlling stakes in subsidiaries like Changan Automobile and Dongan Engine, and overseeing the group's automotive components enterprises. China Changan and Changan Automobile are related as a parent company and its core listed subsidiary.

Many automotive media outlets have been perplexed by the relationship between China Changan and Changan Automobile, leading to numerous misconceptions, and I was no different. In October 2023, Zhao Fei, then Executive Vice President of Changan Automobile, was appointed President of China Changan Automobile Group. I congratulated him on WeChat, noting he was the fourth Chairman of Changan Automobile I had encountered, following Yin Jiaxu, Xu Liuping, and Zhu Huarong. Zhao Fei corrected me, clarifying he was at China Changan, the components group, not Chongqing Changan.

On the evening of June 23, Chongqing Changan Automobile Co., Ltd. (Changan Automobile) announced it had received a notice from its controlling shareholder, China Changan Automobile Group Co., Ltd., informing that its name had been changed from "China Changan Automobile Group Co., Ltd." to "Chenzhi Automobile Technology Group Co., Ltd." The relevant industrial and commercial registration procedures have been finalized, and a new business license has been issued. The renamed "Chenzhi Automobile Technology Group Co., Ltd." has a registered capital of 6.092 billion yuan, with a business scope encompassing the design, development, manufacture, and sales of automobiles, motorcycles, automobile and motorcycle engines, and related parts.

Changan Automobile clarified that these industrial and commercial changes do not alter the shareholder's shareholding or ratio, nor do they impact the company's governance, production, or operational activities. Consequently, there will be no change in the company's controlling shareholder or actual controller. Given that the name change of China Changan does not affect its shareholding ratio or actual control over Changan Automobile, why did it occur? Moreover, the new name no longer includes the word "China." It is speculated that the new state-owned automotive enterprise might be named China Changan Automobile Group. On June 6, the video account Yichuidingyin released a short video titled "Yi Observation": China's third state-owned automotive enterprise is poised to emerge, potentially named China Changan Automobile Group.

The video revealed that CSGC recently received a notice from the State-owned Assets Supervision and Administration Commission of the State Council (SASAC), stating that with the approval of the State Council, CSGC will be spun off. Its automotive business will be carved out into an independent central enterprise, with SASAC assuming investor responsibilities. The equity of the spun-off CSGC will be injected into the China North Industries Group Corporation. According to the SASAC notice, Dongfeng Motor Corporation and CSGC's automotive business will no longer be reorganized but instead, CSGC's automotive business will be spun off to form a SASAC-directly managed central enterprise. CSGC's military business will merge into the China North Industries Group Corporation. Upon completion of the spin-off, it will give rise to the third state-owned automotive enterprise after FAW Group and Dongfeng Motor, potentially named China Changan Automobile Group Co., Ltd. Notably, FAW and Dongfeng are deputy ministerial-level state-owned enterprises, with their principal executives being centrally-administered cadres. Their chairman and general manager need approval from the Standing Committee of the Political Bureau of the CPC Central Committee and appointment by the Central Organization Department. In contrast, the nascent China Changan Automobile Group, though also a state-owned enterprise, is of a lower level, belonging to the director-level category, with its principal executives appointed by SASAC.

CSGC's automotive business spans multiple domains, including vehicle manufacturing, component supply, automobile sales and services, and automotive finance. It boasts four listed companies alone, with related automotive enterprises dotted across the nation. Besides Changan Automobile in Chongqing, there are holding enterprises like Jiangling Motors, Dongan Engine, Construction Industry, and Hunan Tianyan, along with numerous equity participation enterprises. Regarding the location of the headquarters of the impending China Changan Automobile Group, the SASAC notice remains silent. Some media outlets speculate Chongqing, others Beijing, and still, others Xiong'an. The reason behind China Changan's name change to Chenzhi Technology likely paves the way for the China Changan Automobile Group Corporation. Once the new state-owned automotive enterprise is established, Chenzhi Technology and Changan Automobile will continue as its member enterprises. (End)