The Shandong automobile integration curtain has been opened. The State-owned Assets Supervision and Administration Commission of Shandong Province will reorganize its subsidiaries Weichai Holdings, Shandong Construction Machinery Group (hereinafter referred to as “Shangong Groupâ€) and Shandong Automotive Industry Group Co., Ltd. to form Shandong Heavy Industry Group Co., Ltd. (hereinafter referred to as “Shandong Heavy Industry Groupâ€). . According to the existing plans, the overall scale of the three companies after consolidation and reorganization will be expected to exceed 100 billion yuan within three years. In Shandong's plan, only the automotive industry will "nurture" another company with a revenue of 100 billion. In the planning of other industries in Shandong Province, there are no shortages of consolidation actions with 100 billion revenue targets. Integration On May 25, 2009, announcements made by three listed companies, Weichai Power, Shantui, and Shandong Juli, announced the establishment of Shandong Heavy Industry Group, a major player in auto parts and components. According to the announcement, the Shandong provincial government office agreed in principle that Weichai Holdings, Shangong Group, and Shandong Automobile Industry Group Co., Ltd. (hereinafter referred to as “Shanqi Groupâ€) would implement the reorganization. After restructuring, Shandong Heavy Industry and its three subsidiaries will establish a parent company management system. In March 2009, after the Shandong Automobile Industry released the draft of the “Regulations for the Revitalization of the Shandong Automobile Industryâ€, the conjectures about the integration of the Shandong automobile industry were invariably heard. Over the years, Shandong has always been regarded as a pity that “there is a large enterprise group with over 1 million in output, such as FAW and SAIC, whose main business revenue exceeds RMB 100 billion.†The “plan†explicitly proposes “to nurture 8 companies and 10 companies to have strong competitionâ€. The large-scale enterprise groups of the company, including two companies with operating revenue exceeding 100 billion yuan." Weichai Holdings and China National Heavy Duty Truck Group, which have just been separated, are the two largest auto companies in Shandong and are naturally regarded by the industry as the focus of integration. In fact, from the previous personnel appointments and dismissals can also be slightly clues. On October 18, 2008, Jiang Kui, deputy general manager of Shantui Group, resigned due to work transfer. At this time, Jiang Kui’s current position was deputy party secretary and deputy general manager of Weichai Holding Group. This may be the personnel arrangement made by the Shandong provincial government for restructuring. In 2008, the sales revenue of Weichai Holdings, the largest domestic engine manufacturer, reached 49 billion yuan. The share of bulldozers in the domestic market of ShanGong Group has remained at more than 50% for many years, and Shantui’s 2008 sales revenue was 6.581 billion yuan. SAIC Group has an annual production capacity of 60,000 light trucks and 1 billion yuan in auto parts. The market share of auto thermostats and thermal switches ranks first in the country, and the total number of auto brake valves in China second. Analysts said that through the reorganization, Weichai could use this to expand the business scope of the upstream machinery industry. SAIC Motor's five ownership companies and seven hosting companies are mostly engaged in the manufacture of automotive parts and parts, and Weichai Holdings can also form a relatively complete upstream and downstream industrial chain. In 2008, Weichai Holdings’ sales reached 49 billion yuan. Chairman Tan Xuguang once set out plans for sales revenue to exceed 100 billion in three years. Today, with the integration of Shangong and Shanqi Group, the dream of Shandong Qianyi Automobile Group is expected to be realized in advance. Once an industry scale of 100 billion yuan has been formed, Shandong Heavy Industry Group can enter the first echelon of the auto industry and is expected to enter the world's top 500. Who will lead the restructuring Among these companies, both Weichai Holdings and Weichai Holdings have an absolute advantage in both the scale of the company and the reputation of the current chairman. Earlier, Weichai and Zhongqi separated the family because Weichai hoped to grasp the fate of the company. According to an insider of Weichai Holdings, the formation of Shandong Heavy Industry Group will be led by the Shandong provincial government, and Weichai’s corporate and product brands will remain. Tan Chengyi, director of the Shandong State-owned Assets Supervision and Administration Commission, told reporters that when the Shandong Heavy Industry Group was formally established and who would be the head of the company, it was not clear. The three companies jointly formed the model of Shandong Heavy Industry Group, which is quite similar to the formation of Shandong Iron and Steel Group. That is, the establishment of a new enterprise group will include existing enterprises. In contrast, Weichai not only has an absolute advantage in Shandong Heavy Industry Group, but also a large-scale enterprise that integrates engine assembly and automobile parts production. Weichai can also link the other two companies together. Analysts said that it is not possible to rule out the possibility of heavy industry groups being appointed by provincial government officials, but it seems that resistance from Huichai to reorganize itself is minimal. Among the three companies, only Weichai Holdings has had the experience of cross-regional industrial integration in the restructuring of the Torch of Hunan. However, the reorganization and Weichai's acquisition of the Hunan Torch cannot be compared. In August 2005, Weichai entered the main torch in the market. After paying RMB 1 billion, Weichai was able to make drastic changes in the subsequent integration. An expert from the Shandong Automobile Industry Association stated that although the establishment of Shandong Heavy Industry Group was initiated by the Shandong Provincial Government for equity transfer and no use was made of any funds of the company, future industry adjustments will inevitably carry with the government multiple considerations on employment and personnel resettlement. . No matter who will play the leading role in industrial integration, progress will not be so rapid. According to industry sources, due to the strong strength of ShanGong Group, it is second only to Xugong Group in the field of mechanical engineering, and the industry is self-contained. No matter who will become the head of Shandong Heavy Industry Group, the difficulties in integration will most likely occur in the integration of Weichai and Sangong Group industries. It is reported that the restructuring of Weichai and Shangong and Shanqi is only a prelude to the integration of the Shandong automobile industry. Recently, there are many rumors that the China National Heavy Duty Truck Group will be reorganized into the Zhongtong Bus under the Shandong State-owned Assets Supervision and Administration Commission. However, the response of the two is very similar to the slogans of Weifang and Shangong's previous rumor - the company did not discuss the matter.