Chinese State-Owned Automaker Dongfeng Motor Cuts Prices after Chairman Change Up
Dongfeng Motor, a Chinese state-owned automobile manufacturer headquartered in Wuhan, Hubei Province, has begun offering incentives to customers. After its own subsidies and government subsidies combined, the discount totalled between 10,000 yuan ($1,442) and 90,000 yuan ($12,984). This move was after the dismissal of Zhu Yanfeng, Chairman and Secretary of Party Committee of Dongfeng on March 3.
Zhu, who has been in charge of Dongfeng Motor for nearly 8 years, was born in March 1961 and is now 62 years old. According to the new regulations on the retirement of leaders in state-owned enterprises issued in December 2018, the retirement age is 60 years old, but it can be extended to 63 years old in certain circumstances. This sudden “early retirement” triggered the guess that the company’s transformation led by Zhu failed to meet expectations.
Zhu is a veteran of the automobile industry. He has served as the general manager and chairman of FAW Group, and deputy secretary of the Jilin Provincial Party Committee. In 2015, Zhu returned to the automobile industry again and has been at the helm of Dongfeng Motor since then. However, after the sales volume of Dongfeng reached the peak of 4,276,700 vehicles in 2016, it began to decline, with only 2,460,700 vehicles in 2022.
On the one hand, the company’s fuel vehicle business is weak, and on the other hand, its electric vehicle brands Voyah and Mengshi have failed to boost its sales volume.
Many of Dongfeng Motor’s brands, including Dongfeng Honda, Dongfeng Peugeot, Dongfeng Citroën and Dongfeng Fengshen, have started to wildly cut prices. This move was initiated by the Hubei provincial government and proposed to last from early March to the end of the month. To take advantage of this subsidy, customers’ vehicles and licence plates need to be obtained in Hubei Province.
In particular, Dongfeng Citroën witnessed the sharpest price reduction. The original price of the C6 co-creation version and comfort version was 211,900 yuan and 226,800 yuan respectively, both of which will be cut by 90,000 yuan. Finally, subsidies worth 56,000 yuan will be provided for buyers of the C3-XR extreme version.
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The large subsidies have aroused consumers’ enthusiasm. On the morning of March 7, the number of viewers on the livestreaming channel of a Dongfeng Citroën dealer was nearly 10,000 at the peak, and users constantly inquired about car purchases. According to the livestreamer, the discount is for consumers with ID cards and half a year of social security in Hubei province.