China’s central government is eager to push consolidation on the burgening Chinese car industry, but Guangzhou Auto’s recent purchase of Guangzhou’s Yue Jiang Coach Company for a mere 1rmb.
According to information supplied, it appears that Yue Jiang Coaches has already gone bankrupt as of 2008 and no longer has the ability to produce vehicles, however its assets are apparently 80 million RMB, net assets are worth over 86 million RMB.
Guangzhou Auto has recruited an asset management company to review Yue Jiang’s accounts and look over Yue Jiang’s debt of 120 million RMB. Although Guangzhou Auto has taken over the company, Yue Jiang will still be permitted to carry out its own R&D for a period of 3 years.
It is unclear what Guangzhou Auto are eager to become a coach maker, however both Chery and BYD have recently announced their plans for pure electric or hybrid coach technology, it could be that Guangzhou Auto are eager to play catch up with their neighbours.
