(Nio China headquarters in Hefei, Anhui province.)
Central China's Anhui province is always in the spotlight for its reform moves, from betting a fifth of its revenue on BOE to making 45 billion yuan ($6.7 billion) in half-year profits from its investment in Chinese EV maker Nio (NYSE: NIO) this year, it has made every major investment lucrative.
On April 29, 2020, Nio signed a definitive agreement to invest in Nio China with strategic investors, including Hefei Construction Investment Holding (Group) Co Ltd, and reached an agreement with the Hefei Economic and Technological Development Zone to locate Nio China's headquarters.
According to the investment agreement, the strategic investors will invest RMB 7 billion in Nio China.
In recent months, China's new-energy vehicle sales have been in the peak season, and Nio has risen more than 10 times in six months. Based on the RMB 7 billion investment made by the Anhui government, it has made a profit of RMB 44.8 billion.
This is not the first time the Hefei government has won an investment victory.
In 2007, the Hefei city government's investment in BOE can be described as a wave of bold gambling. At that time, Hefei city's revenue was only 30 billion yuan but took out 6 billion yuan to invest in BOE.
At that time, the strategic investor invested RMB 3 billion in BOE, and the Hefei government also assisted BOE to obtain RMB 8.5 billion in loans.
The total financing of 17.5 billion RMB allowed BOE to start building the 6th generation TFT-LCD LCD panel line smoothly.
Prior to this investment, the BOE was losing money and its 5th generation products were not selling well, but the 6th generation products were the turning point, leading performance, competitiveness, and share price upward.
In recent years, BOE has been praised for once propping up the entire Hefei economy, and by the end of 2017, BOE's investment in Hefei had exceeded RMB 100 billion.
To this day, BOE's 8.5-generation LCD panel production line and 10.5-generation line of the world's highest-generation line are also up and running in Hefei, and a large number of companies in the display field have come over to invest.
On June 24, 2014, China issued the National Integrated Circuit Industry Development Promotion Outline, which elevated the development of the integrated circuit industry to a national strategy.
Hefei city government decided to take the hand of GigaDevice together to overcome the problem.
On October 27, 2017, GigaDevice announced that it and Hefei City Industrial Investment Holding (Group) Co. signed a "Cooperation Agreement on Memory R&D Project" on October 26, agreeing to cooperate on a 12-inch wafer memory (including DRAM, etc.) R&D project in the Hefei City Economic and Technological Development Zone in Anhui Province with process 19nm memory, the project The budget is about 18 billion yuan.
The project is 75% funded by Hefei Industry Investment, totaling RMB 13.5 billion, which is nearly double the investment in BOE. The two parties have established a joint venture, Hefei ChangXin, with the goal of successfully developing the device by December 31, 2018.
In 2019, ChangXin bought a patent license from Canadian intellectual property vendor Wi-LANInc. In 2019 9, Hefei ChangXin announced the start of mass production of 8Gb of DR4 memory.
In addition, in May of this year, the Anhui Provincial State-owned Assets Supervision and Administration Commission (SASAC) held a stake in JAC by Volkswagen Holdings, and then JAC shares went up all the way, and are still up over 50% since today.
On April 24, 2020, the Anhui provincial government held a press conference, said it has begun to deploy 2020 key project investment plans.
Anhui at that time arranged a total of 6,878 key projects and an annual plan investment of 1.3 trillion yuan. Among them, 2583 key projects have more than 100 million yuan in investments.
Judging from the results of Anhui's completion in previous years, it is likely that the task will continue to be completed ahead of schedule.
Related posts on CnEVPost
