Weima Motors, the big brother of the new force of car making, has been in the process of bankruptcy reorganization since October 2023. During this period, the factory has been shut down and almost all 4S stores have closed. 100,000 Weima car owners have been “abandoned.” As “315” approaches, Red Star Capital has visited and found that Weima Motors is currently maintaining basic normal operations in the case of a half-paralyzed app. However, the lack of intelligent experience has the biggest impact on the lack of after-sales service, and the high cost of maintenance and repair. Ride-hailing drivers and operators vote with their feet. In addition to the six-month production suspension, Weima Motors is gradually withdrawing from the travel market. In addition, due to poor liquidity, second-hand car dealers generally do not want to acquire Weima cars. In addition to the impact of pure electric vehicles and the bankruptcy of the factory, second-hand Weima cars, even at a discount of 70%, are rarely sought after. Now, Weima Motors’ bankruptcy reorganization procedure has been accepted by the court, and the first creditors’ meeting will be held on March 29. Weima Motors stated that although it is facing a liquidity crisis, it still has certain value and potential in terms of product technology, industrial chain, market operation, and manufacturing capability. Car owners are repairing and maintaining their vehicles at their own expense. They are buying spare parts online. Mr. Zhang spent about 170,000 yuan (23650$) to buy a Weima EX5 in 2019. At the beginning of this year, he put it on a used car website with a price tag of only 60,000 yuan (8350$). According to his recollection, before 2022, Weima Motors provided high-quality after-sales service, with the whole vehicle being free of charge for 4 years or 120,000 kilometers, and the three-electric system being free of charge for 8 years or 150,000 kilometers. The car machine had unlimited and free flow, and official maintenance was cheaper than third-party platforms. However, a repair in August 2022 made him feel that Weima Motors might have a problem. “The 4S store couldn’t solve the air conditioning noise problem for a long time. Later, they said they needed to replace the compressor, but the manufacturer didn’t have any in stock. Using a third party would cost 2,000 yuan (280$).” In November 2022, Shen Hui, the chairman of Weima Motors, issued a communication to all employees, announcing a company-wide pay cut. January 2023, Shen Hui used “to live on, to live like livestock” to describe the plight of Weimar on Weibo. “Everyone feels that Weimar is going to ‘fall’, and there are more and more after-sales problems.” In February 2023, Mr. Zhang’s Weimar EX5 had another malfunction. “It was sent to the 4S store for over a month, and they said it was because the manufacturer didn’t send the parts. The official customer service couldn’t be reached, and the dealer couldn’t contact the manufacturer. In the end, external parts were purchased.” In October 2023, Weimar’s car system experienced a widespread crash, and the app was paralyzed. Although it quickly returned to normal, the official did not provide an explanation. On October 9, 2023, Weimar was exposed to apply for bankruptcy review. “Finally,” Mr. Zhang said, “after more than half a year of trepidation, the boots finally fell. After this, one 4S store of Weimar disappeared after another, and by the end of the year, all repairs and maintenance needed to be paid for through third-party platforms.” According to the “Implementation Measures for Automobile Brand Sales Management,” after the car is discontinued, the manufacturer still needs to ensure the supply of parts for 10 years. Before the bankruptcy and discontinuation of the car company, there is an obligation to properly handle the subsequent maintenance of the vehicles already sold. In the eyes of the car owners, Weimar did not do this, and many exclusive and unique parts are difficult to find and expensive. On March 9, a Tmall car maintenance staff told Red Star Capital Bureau on the spot: “Including Weimar, we can find parts for multiple discontinued or discontinued models, some are from scrapped cars, and some come from the original suppliers.” After Weimar became “dangerous horse,” Mr. Zhang began to do basic maintenance himself. “Some parts can be bought on e-commerce platforms, but they may not fit completely. I bought wipers on Taobao, and the length is not quite right.” Until today, Mr. Zhang’s Weimar EX5 is still within the original factory warranty range, and he has also purchased a “Yue Xiang Maintenance Package” for 698 yuan (100$), but it has all become a mere formality. Weimar gradually eliminated by the online car-hailing market after more than half a year of production suspension. Weimar E.5 and EX5 are both suitable for the travel market. The former has an NEDC pure electric range of 505 kilometers, priced at 15-21 million yuan, and the latter has an NEDC pure electric range of 403 kilometers, priced at 14-20 million yuan. According to a driver of online car-hailing, with various preferential policies, Weimar cars only need about 120,000 yuan (16700$). The actual range of the E.5 exceeds 400 kilometers, and the actual range of the Weimar EX5 is about 350 kilometers, both of which are considered qualified for online car-hailing. Mr. Wang, an online car-hailing driver, purchased a Weimar E.5 a few years ago and now uses it for online car-hailing without any problems. However, Weimar cars are being abandoned by the online car-hailing market. According to relevant regulations, newly licensed online car-hailing vehicles must be new within six months, while Weimar cars have been out of production for more than half a year. According to Mr. Liu, the person in charge of a company-owned online car-hailing fleet, the residual value is an important criterion for their evaluation. After Weimar’s explosion, the prices of second-hand cars have dropped significantly, while the costs of commercial insurance and maintenance have risen sharply. There are many cost-effective alternatives in the market, and the fleet has switched to other car brands. On March 9th, Red Star Capital contacted a delivery commissioner for Didi Chuxing, who stated that online car-hailing drivers need to rent or purchase specific models designated by the company, and the insurance and maintenance costs are covered by the company. “We only have one Weimar E.5 now, and it’s been broken and hasn’t been fixed. Here, we recommend the Chery D60 and the Nissan Sylphy 460. Both have a range of 400 kilometers, and the monthly rent is only over 2,000 yuan (280$). The monthly rent for the Weimar E.5 is over 3,000 yuan (420$), and no driver is willing to rent it.”
Unrepaired Weimar E.5 ride-hailing cars Used cars as low as 80% off Mostly ignored Many consumers choose to sell their Weimar cars. On platforms such as Guazi Used Cars and Autohome Used Cars, Red Star Capital found hundreds of Weimar E.5, EX5, and W6 cars, with discounts ranging from 30% to 50%, with the lowest at 20%, selling for 45,000 to 80,000 yuan (11130$). The displayed mileage is mostly less than 100,000 kilometers, with the lowest being only 0.99 kilometers. Some are simply labeled as “practice cars.”
Even if the car is in good condition and the price has been reduced, most of these Weimar used cars are not selling. According to a seller, “Weimar car factory has collapsed, and it’s not like JEEP, which has GAC as a backup. The maintenance prices are high. Many people buy used cars for the sake of cheapness. There are many brands available for forty to fifty thousand yuan.” Red Star Capital Bureau visited the Hongmeng used car trading market and the China Western Auto City and learned that the resale value and turnover rate of new energy vehicles are low, especially for pure electric cars. “And in the past two years, new car prices have dropped dramatically, making it easy to lose money.” The vast majority of used car dealers explicitly refuse to accept Weimar cars. Red Star Capital Bureau learned that in the entire Hongmeng used car trading market, only one car dealer has a Weimar EX5 for sale, and it has been in stock for a long time. When the reporter inquired about repurchase as a consumer, the other party could not make a commitment. Guazi used cars only act as agents and do not accept cars for sale. Sales consultant Mr. Yan admitted to the Red Star Capital Bureau that the depreciation of a Weimar car in one year may be twice that of a normal brand. “To be honest, I don’t recommend you to buy a Weimar car. It’s difficult to trade in, and it’s easy to get stuck with it.” It is reported that Weimar still has a small number of employees maintaining the basic operation of the car’s system and APP. “After the used car is transferred, the new owner can upload the information to the APP to log into the car’s system.” Bankruptcy reorganization proceedings initiated Can Weimar be reborn? On January 26, the Third Intermediate People’s Court of Shanghai announced that Weimar Automobile’s reorganization process had been accepted by the court, and the first creditors’ meeting will be held via video conference on March 29. On January 2, Weimar Automobile announced that the court accepted Weimar’s pre-reorganization application on October 7, 2023. During the pre-reorganization period, Weimar completed auditing, assessment, debt declaration, and asset verification work, and made preliminary progress with multiple potential investors. Weimar officially submitted the application for pre-reorganization to reorganization to the court on December 13, 2023, and the court accepted the ruling on the same day. Weimar Automobile stated that after verifying Weimar Group’s basic situation, assets, and liabilities through legal procedures, potential strategic investors generally believe that despite the current liquidity crisis facing Weimar Group, it still has certain value and potential in terms of product technology, industrial chain, market operations, and manufacturing capabilities. Public information shows that Weimar Automobile has accumulated more than 41 billion yuan in financing and has failed to go public three times. The prospectus shows that from 2019 to 2021, Weimar suffered losses of 4.14 billion yuan, 5.08 billion yuan, and 8.258 billion yuan, with a total net loss of 17.435 billion yuan over the three years. The total amount of loans was 2.42 billion yuan, 6.41 billion yuan, and 9.95 billion yuan, respectively. From 2019 to 2022, the sales of Weimar cars were approximately 16,800, 22,500, 44,200, and 29,500, totaling 113,000 units. -Red Star News reporter Wu Danruo -Editor Deng Lingyao