In today's automobile industry, a new energy army is sweeping in. Many car companies represented by Tesla are developing particularly rapidly, snatching away many traditional automobile markets. Under such circumstances, many people have predicted that new energy vehicles will gradually replace traditional cars in the future, and the latter will eventually completely withdraw from the stage of history. Perhaps it is precisely because of this prediction that the new energy track is becoming more and more crowded, so that some car companies have no room for survival. Dongfeng Yulon, a domestic dark horse 10 years ago, has fallen, and the company is now facing bankruptcy and reorganization. What exactly caused Dongfeng Yulong to fall to this point?
The development history of Yulong Automobile can be traced back to 1953. It is one of the earliest civilian car companies in Taiwan. After years of development, it has very good qualifications, hardware and reputation. In 2010, Yulong Auto's then chairman Yan Kaitai came to Hangzhou and reached a cooperation with Dongfeng Motor . The two parties jointly established Dongfeng Yulong Auto with a ratio of shares at 50:50. The company's initial positioning was the independent brand of China . It was from this time that Yulon Group targeted the mainland market. The reason I chose the mainland is that as early as 2008, the automobile markets in many countries such as the United States and Japan had already shown a weak state, but the mainland market still has a lot of room for development.
So after the two sides started cooperation, Yan Kaitai spent more than 10 billion yuan and placed his hope on Dongfeng Yulong. Soon, Yan Kaitai's light of hope was ignited by Nazhijie . This is the first brand since the establishment of Dongfeng Yulon, and it is also the biggest boost for the company to reach its peak. At that time, the domestic SUV market was in an explosive growth period. Based on this trend, the company launched the first mass-produced car, , Nazhijieda 7. Dongfeng Yulon positioned it as a mid-to-high-end, and its model was a mid-size SUV. As a new brand that has just entered the mainland, Nazhijie can become a popular internet celebrity product in the shortest time.
How much do consumers like this car? 2011 is the first year of this car's launch, with sales reaching 6,917 units that year. It is already very good for a new brand to have such annual sales. In 2012, Nazhijie sold 31,000 cars with this model, and even successfully ranked among the top ten domestic SUV market segments, becoming the hottest model of that year. The reason why consumers like this car so much is that the car's shape is avant-garde and novel enough. Many consumers are very satisfied with the appearance of Nazhijie, and on the other hand, it is because its price is relatively affordable.
After tasting the sweetness, Dongfeng Yulong launched a number of models in one go. He also shouted the slogan "Sales exceed 200,000 and revenue exceeds 25 billion in five years." In 2014, sales volume rose to 52,200 units, and by 2015, the brand's annual sales volume had reached 60,300 units. Obviously, for Dongfeng Yulon, such results may not meet expectations. So this year, the company has spent tens of millions of dollars to hire Jay Chou as an exclusive endorsement. With the support of traffic, Nazhijie has become even more glorious and has attracted the attention of countless consumers.
Dongfeng Yulong may think that as long as the brand is "Internet celebrity", there will be no need to worry about sales, so since he invited Jay Chou, he has been doing advertising and marketing in a high-profile manner. But what they didn't expect was that traffic and sales were not proportional. In the second half of 2015, Dongfeng Yulon's sales had already shown a downward trend. By 2016, it began to plummet. Compared with the previous year, annual sales in 2016 fell by a full 20,000 units. By 2017, the annual sales were only 18,000 units, and in 2018, there were only 9,361 units left. The situation was even worse in 2019. More than 1,000 units were sold in a year, and there was almost no profit margin.
In desperation, Dongfeng Yulong had to suspend production. Since June 2019, the company's production bases have been suspended one after another. Due to the long-term decline in sales, the company basically has no profits from , and the remaining funds are difficult to maintain normal operation, so many employees have left one after another.
In fact, in the past few years when sales plummeted from 2016 to 2019, Nazhijie has also worked hard and launched many models such as You5, Jeremy 3, and URX, but the sales are far inferior to the original Nazhijie Big 7, and no car can stop the decline. During this period, Dongfeng Company even directly announced its withdrawal from Dongfeng Yulon's business management. Dongfeng Maybe he had guessed the fate of Dongfeng Yulong long ago.
2020, after 10 years of ups and downs, Dongfeng Yulong still went bankrupt. The sales of only 77 units this year were almost at a loss, and they were eventually bankrupt and reorganized.
Why did the dark horse car companies that once led the trend ended up just a flash in the pan?
The main reason why Dongfeng Yulong has fallen to this point is that he is himself. Initially, Nazhijie was an internet celebrity car that consumers couldn't put down, but later the three words Nazhijie became a joke. When consumers mentioned this brand, they complained and complained, and no one was willing to pay for it anymore. Why is this?
Nazhijie has a very famous feature. Anyone who has bought it knows that it is fuel consumption. There are many jokes about this car online, such as "You can run around the gas station if you fill up the gas", "A car worth 200,000, a configuration worth 300,000, a fuel consumption worth 1 million", etc. If your friend bought a Nazijie, then he will most likely not be able to call him because the gas station cannot answer the phone. Many netizens also joked wildly that Nazhijie is an important strategic partner of PetroChina and Sinopec . As long as you buy this car, you are either at the gas station or on the way to the gas station. Someone else joked that if you plan to buy a Nazijie, you have to buy a gas station in advance.
Even the new model launched in 2016 still uses the old 2.2T engine. Although Nazhijie has added an automatic start-stop ECO mode to this car, it still cannot change the disadvantage of high fuel consumption. Official data show that the fuel consumption required by NaZE 7 to travel 100km is 8.9 liters, but the actual fuel consumption is higher than this number. Many car owners said that their car's fuel consumption for 100km has exceeded 10 liters, and sometimes it can reach 14 liters. If the accelerator is accidentally heavy, it will be fine to reach 18. So many people joke that if Nazhijie withdraws from the Chinese market one day, the gas station will probably cry and faint in the toilet. Oil prices have been rising rapidly in recent years. Who would be willing to buy a gas tiger and go home?
At that time, those consumers who were attracted by the appearance of this car were laughed and crying after driving for a while. Nazhijie was completely in line with the old saying: gold and jade are on the outside, and fragile are on the inside.
In addition to the high fuel consumption, Nazhijie has many other problems. For example, many problems such as poor mechanical quality and poor stability. According to many car owners, the car they buy often suffers from various failures such as transformer damage, abnormal noise, and sometimes the engine will leak oil. Even the THINK+ system, which is mainly promoted by the brand, often has lag and crashes. Some people may ask, isn’t Nazhijie a dark horse? Why is the failure rate so high? Such poor quality? This is because many models under the brand are produced from the 4th generation Renault ESPACE platform, and this platform should have been eliminated in 2003. When Dongfeng Yulong was founded, it was already in 2010. It was still a car-making platform that was eliminated 7 years ago. The technical level is conceivable. The fundamental reason is that the company's R&D capabilities are too weak and do not have enough core technologies to support it. Relying solely on stack configurations to create a false sense of technology and cost-effectiveness to conceal technical shortcomings.
In addition, Nazhijie has not kept up with the changes in the mainstream automobile market in its R&D ideas. Taking 2020 as an example, none of the fuel models on sale on the official website at that time comply with the "National VI" standard, and the car with the highest environmental protection standards is still in the "National VI" stage.
If that is the case, why would Nazhijie still welcome a good start? The reason why Dongfeng Yulong was so smooth at the beginning of its establishment was that many domestic independent brands had not yet developed. The market demand for SUVs is relatively large, so it is given an opportunity to develop.But later, with the development of many independent brands such as Great Wall, Changan , Geely , etc., Nazhijie has no competitive advantage. In addition, there are so many problems with the product and such a poor reputation, it is normal that it cannot survive in the market.
After the frequent problems with product , Dongfeng Yulong's after-sales service also had serious problems. Many car owners said that Nazhijie's handbrake, electromechanical and other after-sales spare parts are insufficient. Sometimes I can’t find a place to repair the car. Under the influence of many factors, the value retention rate of Nazhijie's products is also very low. In the used car market, more than 80% of the Nazhijie you can see are new cars, but even if the price is only half of the new car, or even less than half of the used car dealers are unwilling to collect it. So everyone has a saying about Nazhijie Automobile: "The car that my second brother dares to take it away."
In addition to traditional fuel vehicles, Nazhijie entered the field of new energy vehicles very early. At the 2011 Shanghai International Auto Show, the brand had already shown Volkswagen the electric concept car Neora. Dongfeng Yulon has become one of the earliest companies in China to develop new energy vehicles, but this car has not been launched. Later, Nazhijie launched a pure electric SUV-U5, but unfortunately it has not caused any waves. This is not because the opponent is too strong, but because Nazhijie is making too slow in the new energy field. Even the pure electric SUV launched is an oil-to-electric model. This was just getting up early, but nothing was taken.
It is not difficult to see that Dongfeng Yulong also wants to get a share of the new energy vehicle field. However, his ability is not as mainstream as possible, and he is unwilling to completely give up fuel vehicles like BYD , resulting in getting nothing in the end. If Nazhijie had seized the opportunity of new energy a few years ago, it might not have fallen to this point now. Rather than saying that Dongfeng Yulon fell into the wave of new energy, it is better to say that it has failed to its own incompetence. This development model is inevitable that it will be eliminated by the times.
Although Dongfeng Yulong fell, it still has some surplus value. In addition to assets such as land, factories, automobile laboratories, etc., Dongfeng Yulon also has the production qualifications of traditional fuel and new energy, as well as a complete set of production lines and equipment. However, some industry insiders pointed out that Dongfeng Yulon's production line is relatively backward, and it is still unclear how high the usable value is. In addition, the company's location advantages are relatively obvious. Dongfeng Yulon is located in Qiantang New District, Hangzhou, Zhejiang. Anyone who is familiar with it should know that the area is very complete with industrial supporting facilities.
But compared to these surplus values, Dongfeng Yulon's huge debt of 7 billion is even more deterrent. This is just an open number. Only Dongfeng Yulon knows how big the hole is. Although the company has started to invest in foreign investment since November last year and issued investment promotion announcements on its official website twice in March and July this year, several attempts ended in failure and no one is willing to take over. Dongfeng Yulon has announced bankruptcy and reorganization in recent years. From 2020 to the present, many well-known car companies such as Cheetah and Zotye have announced reorganizations. Take Zotye as an example. Not long after the bankruptcy was announced, someone had successfully taken over. Dongfeng Yulon stayed on the bankruptcy and reorganization list for more than half a year. In addition to the huge debt of 7 billion yuan, there is another reason why Dongfeng Yulon frequently fails to invest in investment, that is, the investment conditions they offer are not low. From the investment announcement released by the company on its official website, we can see that the intended investors need to meet the seven basic conditions. It is clearly stated that investment enterprises should focus on the research and development and sales of new energy vehicles as their main business direction, and must also have product design and development capabilities and production capabilities that are compatible with the investment projects. In addition, they must have sufficient funds to ensure the sustainable development of subsequent projects. In addition, the announcement also stated that if investors want to invest, they must attract another qualified car company to invest together.
Just by striking these conditions to the point, it can keep countless investors out. If you filter according to these conditions, then in the end, there will probably only be cross-border players such as Baidu and Xiaomi who have the chance to take over.However, the qualifications that Dongfeng Yulon currently possesses are not attractive to many new car-making forces at all. Those car companies that have both funds and strength may not look down on Dongfeng Yulong. Under this situation, Dongfeng Yulong may relax the conditions so that he can give himself more opportunities to survive.
I wonder when the four words "Dongfeng Yulong" will be crossed out from the bankruptcy and reorganization list?
