Sad Yin Mingshan: The Sails Flutter And The Dream Of Making A Car Is Broken

"Lifan enchanting, old Yin Xiaoyao."

In 2017, Yin Mingshan, founder of Lifan industry (Group) Co., Ltd. (hereinafter referred to as Lifan), the former king of motorcycles and the former richest man of Chongqing, had high hopes for Lifan when he retired in 2017.

However, only in the past three years, Lifan, who has been punished for fraud, sales decline and broken capital chain, has been in debt and in turmoil, and Yin Mingshan's "carefree dream" has long been broken.

On the evening of October 13, Lifan announced that the China Securities Regulatory Commission (hereinafter referred to as the CSRC) had issued a "Notice of investigation". The CSRC decided to file an investigation into Lifan holdings, Yin Mingshan and their family members Chen Qiaofeng, Yin Xidi and Yin Suowei who were suspected of illegal information disclosure.

At the same time, the announcement shows that if the company is ruled by the court to accept reorganization, there is a risk that the company will be declared bankrupt due to the failure of reorganization. If the company is declared bankrupt, it will be liquidated.

Therefore, the administrative departments of listed companies are punished for illegal disclosure of information. Of course, in addition to the company's fine, the direct responsible person will be punished to varying degrees. If the circumstances are serious, the actual controller will face criminal responsibility. " On October 19, some people in the securities industry said in an interview with the 21st century economic report, "in addition, investors whose rights and interests are damaged can also file civil compensation litigation with the court with jurisdiction. But how the incident develops next depends on the investigation results of the CSRC. "

At this time, Yin Mingshan, who had been working for 18 years, started selling motorcycles at the age of 54, and finally led Lifan to become the first share of A-share private cars at the age of 72, and established a ten billion Lifan Empire, was 82 years old.

And the war of Lifan, even Yin Mingshan, who has been up and down for half of his life, is afraid that he will not be able to recover.

Multi faceted life of legendary richest man

"China's first private passenger car enterprise listed in a share market", "China's first private entrepreneur to enter the top level of the CPPCC", "China's top 500 enterprises", "Chongqing football card"

Lifan, which almost grew up with Chongqing's modern manufacturing industry, is almost well-known in Chongqing, and its founder Yin Mingshan is a legendary figure among Chinese private entrepreneurs. Book publishing, motorcycles, automobiles, real estate, finance, football The Lifan empire founded by Yin Mingshan will extend its tentacles further and further. Behind the title of "Chongqing's richest man" and "motorcycle king", Yin Mingshan's multifaceted life is deplorable.

"A wise cat will always keep a crouching posture, waiting for a gust of wind to blow open the door again, and jump out. I am such a waiting cat. I have not become a living fossil because I have been challenging the environment, fate and myself

As Yin Mingshan said, he has always been the "waiting cat".

In 1979, at the age of 41, Yin Mingshan officially ended his 18-year-old labor reform. During this period, he not only became an excellent worker, but also taught himself English. After the transformation, Yin Mingshan was transferred to Chongqing Design Institute as an English teacher, and later entered Chongqing Publishing House.

In 1985, the spring breeze of reform and opening up has been blowing all over China. Yin Mingshan, who has become the vice president of Chongqing Publishing House, sniffed out the business opportunities. He resolutely became a book publisher and successfully published the middle school students' ten cents series, making the first pot of gold in his life.

In 1992, Yin Mingshan, who was already the largest private bookseller in Chongqing, decided to start again because the book industry was unable to carry a bigger dream. At the end of the year, he and Zuo Zongshen, the founder of Zongshen group, one of the largest domestic motorcycle manufacturers, jointly founded Chongqing Rongda vehicle parts Research Institute, officially starting the motorcycle manufacturing career.

This year, Yin Mingshan was 54 years old.

Chongqing was famous for motorcycles in the 1990s. Jialing and Jianshe, the local brands, were the local giants, holding most of the market of motorcycle "heart" engines. Large factories are unwilling to sell engines to small retailers, so some small factories have to pay high prices to buy poor quality engines from other places and replace them with inferior ones.

"We should build motorcycle engines that are not available in China or in the world." With a 40 square meter workshop and 9 employees, Yin Mingshan, who saw the business opportunities, led his employees to create two "China's first": the first 100ml 4-stroke engine in China and the first 100ml electric starting engine in China.

With the expansion of the scale, such as water cooling, multi valve, EFI, dual fuel, secondary combustion, large displacement and other leading technologies in the motorcycle industry were developed by Lifan.

In 2000, Lifan motorcycle produced and sold 1.84 million engines with a sales revenue of 3.85 billion yuan, surpassing Jialing, Jianshe and other brands and becoming the first enterprise in China in sales volume.

In the same year, Yin Mingshan, 62, was listed on Forbes' 2000 list of 50 richest Chinese with a net worth of 550 million yuan.

It was also in this year that Lifan extended its tentacles to the football industry, bought Huandao club with 55.8 million yuan, entered the Chinese football arena, and shouldered the banner of Chongqing football.

At the beginning of 2003, Yin Mingshan, 65, chairman of Lifan industrial group, was officially elected vice chairman of Chongqing Municipal Committee of the Chinese people's Political Consultative Conference. This private entrepreneur with a total assets of more than 1 billion yuan also became a deputy provincial (ministerial) official. At this time, Lifan has become the largest motorcycle manufacturer in China.

In the past 20 years, Yin Mingshan's entrepreneurial experience has also created his ability to find business opportunities in the crisis: before the motorcycle market shrank, Yin Mingshan focused on the automobile manufacturing industry, which is more challenging.

Different from the success of previous entrepreneurship, the vehicle manufacturing with higher requirements on core technology and greater investment also foreshadowed the "storm" in Yin Mingshan's later years.

Rough road

In fact, from motorcycles, automobiles, football to new energy vehicles, and then to hydrogen fuel vehicles, Lifan led by Yin Mingshan has been chasing the wind in the industry.

"Toyota everywhere, Santana everywhere, ask Lifan people, what do you want us to do?" On the exterior wall of Lifan factory, red slogans bear Yin Mingshan's dream of making cars.

In 2003, Yin Mingshan acquired 80% of the shares of Chongqing special purpose vehicle factory, officially changed the trademark of "bombarda" to "Lifan", and began to build a car production base in Beibei. In the same year, Wang Chuanfu of BYD also broke into the automotive field with Yin Mingshan.

However, the road to car building is bound to be a difficult and narrow track, in addition to the core technology, but also requires a huge amount of capital investment.

According to the "automobile industry development policy" issued by the national development and Reform Commission in 2004, Lifan needs to achieve an accumulated investment of more than 2 billion within three years, and also needs its own independent research institutions and more than 500 million R & D investment. Under this policy, Lifan sedan "quasi birth certificate" failed. It was not until December 2005 that Lifan automobile got the approval from the national development and Reform Commission to be listed in the car production catalogue. In January 2006, Lifan 520, the first model of Lifan, was announced on the market.

Before him, Li Shufu, who also started in the motorcycle industry, had already driven Geely.

According to the data released by the China Automobile Industry Association, in 2006, China's automobile sales exceeded 7.2 million, with a year-on-year growth of more than 25%. For the first time, China surpassed Japan and became the second largest automobile consumer after the United States. Among them, the total sales of self owned brand passenger cars were 2146700, among the top 10 best-selling car brands, Xiali and Geely were on the QQ list. But Lifan 520 sold less than 10000 units in that year.

With the outbreak of China's passenger car market, Lifan also ushered in the highlight moment. In November 2010, Lifan automobile became the first private automobile enterprise listed in A-share market. In the same year, Chongqing Lifan Real Estate Co., Ltd. was officially established, and Yin Mingshan formally entered the real estate industry.

However, under the halo of "Chongqing's richest man", Lifan, lacking of core technology and concentration, began to fall behind on the road of car making.

"Lifan's development process is closely related to the development rhythm of China's automobile industry." On October 19, some people in the automobile industry pointed out in an interview with a reporter that the differentiation of China's private automobile enterprises was very obvious before Lifan's listing. The dilemma of Lifan lies in the fact that its stalls are too large. The reasons for its marginalization are also lack of research and development ability, lack of attention to product quality, non-specific car manufacturing, excessive "speculation" and lack of strategic interest for sustainable development relevant.

"231.4 billion yuan of subsidy from the central government is not involved in obtaining subsidies for new energy vehicles." In 2016, the scandal of "Lifan new energy vehicle fraud compensation" has almost become the turning point of Lifan's fate.

In 2017, 2018 and 2019, Lifan's non net profit deduction for three consecutive years was negative. In 2019, deducting non net profit is a huge loss of nearly 4.4 billion yuan.

According to the financial report of Lifan in the first half of 2020, its operating income in the first half of 2020 was only 1.584 billion yuan, down 69.42% compared with the same period last year, and the net profit was - 2.595 billion yuan, a sharp drop of 173.99% year-on-year. The total assets are about 16.96 billion yuan, the net assets are only 106 million yuan, but the liabilities are as high as 16.77 billion yuan, and the asset liability ratio is as high as 98.87%.

In addition, reporters from the 21st century economic report have found that Lifan Industrial Co., Ltd. issued the announcement on cumulative litigation (Arbitration) matters on August 24. The announcement shows that at present, the company has involved 1178 lawsuits (Arbitration), involving a total amount of 5.037 billion yuan. As of June 18, 2020, the total amount of litigation (Arbitration) involved in the company (including subsidiaries) in the past 12 months was RMB 2.906 billion.

However, compared with operating losses and debt peaking, loss of hematopoietic capacity is the most fatal problem of Lifan.

On September 17, Lifan released a sales express, which showed that in September this year, Lifan produced 19 traditional passenger cars and 67 new energy vehicles, with a total of 86 passenger cars produced in the month; and 2254 passenger cars were produced from January to September. In September, Lifan sold 81 traditional passenger cars and 65 new energy vehicles, with a total sales of 146 passenger cars in the month; from January to September this year, the cumulative sales volume of passenger cars was 1990.

This also means that the actual operation of the company's passenger car business is facing stagnation, and the business of passenger cars, especially new energy vehicles, has declined significantly, and the domestic market has basically lost.

Where to save Lifan?

Lifan is not only a business card of a city, but also an industrial chain with far-reaching linkage.

As early as October last year, the Chongqing government called on creditors of local financial offices and relevant banking institutions to form a debt Committee, requiring all departments not to withdraw loans, not to hold down loans, and to keep lending.

On September 14, Chongqing Liangjiang Equity Investment Fund Management Co., Ltd. and Geely maijie Investment Co., Ltd. were incarnated as "knights in white" and intervened in Lifan's restructuring work as intending restructuring investors.

However, Lifan has not yet ushered in the dawn of reorganization, and the news that Yin Mingshan and his family members have been filed for investigation has once again hit the confidence of the market.

Although Lifan pointed out in the announcement that this investigation is aimed at the controlling shareholders and actual controllers of the company, it has nothing to do with the company's daily management and business activities, and has no impact on the normal operation of the company. However, after the announcement of the case filing investigation, Lifan shares fell without any suspense the next day.

"This is my granddaughter, Annie Yin." On April 27 this year, Yin Mingshan, who is full of white hair, entrusted Lifan automobile to Yin Annie, who was born in 1995. Yin Annie, the new vice chairman of Lifan holdings, was also elected as the shareholder supervisor of Lifan's board of supervisors at the same day's general meeting of shareholders.

In fact, in the context of domestic and foreign difficulties, motorcycle business is seen as Lifan's "life-saving straw". In the first three quarters of this year, although the motorcycle business declined, it was the highlight of Lifan's performance report.

"Before Yin Annie arrived, Lifan chose to concentrate resources to develop the motorcycle industry." People familiar with Lifan told reporters.

Lifan also said in its semi annual report that the focus of the company's business development should be adjusted, focusing on the motorcycle business on which it started. In the second half of the year, the company will continue to promote KP series products and further expand the product line of KP series models.

"If you still want to survive in the automobile industry, it is likely that the rate will be acquired by others, or become a part of other automobile enterprises, then it is possible to continue to exist." Earlier this year, auto analyst Zhong Shi told reporters in the 21st century economic report that "Lifan is basically out of the auto industry, but if you can do a good job in motorcycles, it is possible to turn over."

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