On June 28, Evergrande Automobile announced the voting results of the annual general meeting of shareholders. Among them, the proposal in the meeting "re-election of Mr. Sean as an executive director" received 99.99% of the votes; The "re-election of Mr. Xie Wu as an independent non-executive Director" was unanimously approved. According to the announcement, as at the date of this announcement, the executive directors of Evergrande Automobile are Mr. Sean Iron, Mr. Liu Yongzhuo and Mr. Qin Liyong; The independent non-executive directors of Evergrande Automobile are Mr. Zhou Chengyan and Mr. Xie Wu.
The day before, Evergrande Automobile announced that the company received a nomination notice from Evergrande Health Industry Group Co., Ltd., which is controlled by the liquidators of China Evergrande Group (in liquidation), and the company will appoint a proposal at the general meeting of shareholders to nominate Cai Weikang as an executive director, Liang Jiajin as an independent non-executive director, and Wang Kenan as an independent non-executive director. However, Evergrande pointed out in the announcement that the board of directors did not verify the biographical details of the nominees, and attached the resumes of the above three persons provided by the liquidators.
At the same time, the announcement also involved a "notice of request" to remove the executive directors Liu Yongzhuo and Qin Liyong and any positions they hold in the company, which will take effect immediately.
According to the data, Qin Liyong graduated from Tongji University with a major in engineering management, and then graduated from Tongji University with a master's degree in management science and engineering. From 2015 to 2018, he successively served as the chairman and general manager of Evergrande Real Estate Group Grain and Oil Group, Evergrande Real Estate Group Shenzhen Company and Evergrande Real Estate Group Heilongjiang Company, and from February 2019 to June this year, he served as an executive director of Evergrande Health Industry Group Co., Ltd.
Liu Yongzhuo, born in 1981, is currently the Executive Vice President of Evergrande Group, President of Evergrande New Energy Automobile Group and Chairman of Evergrande New Energy Technology Group. Liu Yongzhuo joined China Evergrande in 2003 and has been in charge of Guangzhou Evergrande Taobao Football Club, Evergrande Cultural Industry Group, Evergrande Agriculture and Animal Husbandry Group, Evergrande Internet Finance Group, Evergrande High-tech Group and other businesses. In 2019, Liu Yongzhuo served as the chairman of Evergrande New Energy Technology Group, and the following year he served as the executive director and president of Evergrande Automobile, and was highly regarded by Xu Jiayin. It should be noted that Liu Yongzhuo was criminally detained in accordance with the law in early January this year.
As a key figure in Evergrande Automobile, Liu Yongzhuo once proclaimed: "Hengchi's big sale is a foregone conclusion." However, it backfired, as of the end of last year, Evergrande Auto had produced only 1,700 Hengchi 5 cars, while the Tianjin plant has ceased production since the beginning of the year and has not yet resumed production.
In response to the recall of Liu Yongzhuo and Qin Liyong of Evergrande Automobile, the industry believes that behind this incident may reflect the financial pressure faced by Evergrande Automobile.
At present, Evergrande Automobile is facing financial pressure. According to statistics, Evergrande Automobile's cumulative losses have exceeded 100 billion yuan, including a loss of 56.344 billion yuan in 2021, a loss of 27.664 billion yuan in 2022, and a loss of 11.995 billion yuan in 2023. Although Evergrande Auto will deliver a total of 1,389 Hengchi 5 units in 2023, its contribution to revenue is still relatively low.
According to the latest financial report data, Evergrande Automobile's total revenue in 2023 will be 1.34 billion yuan, of which more than 1.1 billion yuan will come from property sales, that is, Evergrande Automobile's main revenue will come from property sales, not car sales. As of the end of December 2023, Evergrande Automobile's total assets were 34.851 billion yuan and total liabilities were 72.543 billion yuan, making it seriously insolvent.
However, in the case of Evergrande Automobile's huge losses year after year, Chairman Sean and Vice Chairman Liu Yongzhuo have received huge personal salaries, with a total salary of more than 100 million yuan in 2021 and 2022, of which Liu Yongzhuo's salary in 2021 will be 68.49 million yuan and 43.98 million yuan in 2022.
At present, Evergrande Automobile is still in financial difficulties. On May 26, Evergrande Automobile announced the news that some of the company's shares will be acquired, announcing that about 3.145 billion shares of Evergrande Automobile (accounting for 29% of the total issued shares) will be purchased immediately, and about 3.203 billion shares (accounting for 29.5% of the total issued shares) will be the shares that potential buyers can choose to buy in the future. Evergrande Auto admitted that it is currently suffering from a serious shortage of funds, and hopes that potential buyers will provide loans to Evergrande Auto to fund the group's continuing operation and development of the group's electric vehicle business.
On June 11, the relevant departments planned to order Tianjin Evergrande to stop the production and sales of new energy passenger car products and carry out rectification, in addition, the relevant local administrative departments required Evergrande Automobile to return the various incentives and subsidies that have been issued totaling about 1.9 billion yuan. The news has also made it more difficult for Evergrande to pursue potential investments. Prior to this, Evergrande Automobile had also been seeking "life-saving money". In August last year, Evergrande Automobile said that it had received the first strategic investment of US$500 million (about 3.55 billion yuan) from Newton Group, and after the completion of the transaction, Newton Group will provide 600 million yuan of interest-free and guaranteed transitional funds for the research and development, production and sales of Evergrande Automobile. Unfortunately, this "life-saving money" ended in a "bubble".
As of press time, it is still unclear who will become the "white knight" of Evergrande Automobile, which also makes the subsequent development of Evergrande Automobile full of unknowns.