· BYD Auto Finance and Xi'an Bank jointly fund new energy

A paper approval from the Shaanxi Banking Regulatory Bureau made BYD's (002594, SZ) auto finance dream come true.
Recently, BYD issued a notice saying that the company received the "Announcement of Shaanxi Banking Regulatory Bureau on the opening of BYD Auto (microblogging) Finance Co., Ltd." and agreed to open BYD Auto Finance Co., Ltd. "Daily Economic News" reporter noted that BYD Auto Finance Co., Ltd., a joint venture between BYD and Xi'an Bank, is located in Xi'an Bank Building, Gaoxin Road, Xi'an City, Shaanxi Province, with a registered capital of 500 million yuan. BYD invested 400 million yuan to fund The proportion is 80%; Xi'an Bank Co., Ltd. invested 100 million yuan, with a capital contribution ratio of 20%.
This is BYD's plan to enter the auto finance sector since its inception, and it has finally been approved five years later. After the new energy vehicle production plant, BYD has another important layout in the Xi'an market.
It is reported that after the opening of the business, the auto finance company will be able to handle car loan guarantees and charter car loan deposits, inter-bank lending and auto financing leasing.
At the end of the 5th year, the above approved approvals for BYD Auto Finance Co., Ltd. include: accepting time deposits from overseas shareholders and their wholly-owned subsidiaries and domestic shareholders in China for more than 3 months (including); accepting car dealers to purchase vehicle loans Margin and charterer car rental deposit; approved to issue financial bonds; engage in interbank lending; borrow from financial institutions; provide car loan business; provide car dealers to purchase vehicle loans and operating equipment loans, including showroom construction loans and spare parts loans And maintenance equipment loans, etc.; provide automobile finance leasing business (excluding sale and leaseback business); sell or repurchase auto loan receivables and auto financing lease receivables business to financial institutions; handle the sale and disposal of residual value of rental vehicles; Engaged in consulting and agency business related to car financing activities; and approved to engage in equity investment business of financial institutions related to auto finance business.
Half a year ago, it was reported that BYD and Xi'an Bank jointly funded the establishment of an auto financing company, and it was only today that it was approved by the regulatory authorities to allow it to open.
In fact, BYD's plan to enter auto finance can be traced back to five years ago. In June 2010, BYD decided to invest 400 million yuan to establish BYD Auto Finance Co., Ltd. with France Equipment Leasing Corporation (CGL) to provide financing services for car purchases and loans for end customers of new cars. However, after one year, the plan was terminated.
"Daily Economic News" reporter found that on July 6, 2011 BYD announced that the company and the French equipment rental company (CGL) joint venture to establish BYD Auto Finance Co., Ltd., because the other side believes that the risk of the Chinese auto market is increasing The joint venture parties have different judgments on the risks of the business and have not reached an agreement on the business strategy. Therefore, the two parties have friendly termination of the joint venture contract and the existing cooperation of the joint venture company.
Helping the sales of new energy vehicles It is reported that auto finance is a financial activity that integrates funds in the production, circulation and consumption of automobiles, mainly including fund raising, credit utilization, mortgage discounting, securities issuance and trading, and related insurance and investment activities. According to the prediction of China Association of Automobile Manufacturers, by 2025, China's auto finance market can reach 525 billion yuan.
In fact, currently, GM, Volkswagen, BMW, Dongfeng Nissan, Chery and other car companies have launched auto finance business. In contrast, BYD's auto finance seems a bit late.
“Automotive finance business as a financial tool to help alleviate the pressure on consumers to buy car funds, now all car companies have basically set up. In the case of slower consumption, auto finance plays an important role.” Ipsos Market Consulting Automotive Research Director Ye Sheng said in an interview with the reporter of "Daily Economic News".
The establishment of BYD Auto Finance Co., Ltd. is also another important layout of BYD in the Xi'an market after the new energy vehicle production plant. Zhuo Chuang Information Natural Gas analysts analyzed that the bottlenecks currently faced by new energy vehicles include insufficient power storage and cruising range. In addition, the related charging pile equipment is not sufficient and cannot be charged in time. These bottlenecks affect the sales and promotion of new energy vehicles.
Ye Sheng said that the establishment of auto finance companies will also contribute to the sales of BYD new energy vehicles to a certain extent. “Automotive finance business can provide services to dealers, belong to wholesale finance, provide services to consumers, and belong to retail finance. And auto finance provides related services such as car loans and loans for dealers and consumers, which helps to reduce the purchase of cars for consumers. Stress and increase spending power."
On the above-mentioned issues, the reporter of "Daily Economic News" called BYD's person in charge of the media business, and sent the interview outline after the request of the other party. As of the press release, no reply has been received.

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