[Leo]

Interesting to see the Borgward story in detail. So Ucar bought the Chinese factory and the management company has now become a subsidiary. Do I understand that correctly?
Furthermore, Foton remains the sole owner of the Borgward Group in Germany. But what is really left there? The Bremen factory was cancelled earlier this year, so I asume there is some R&D and maybe the trademarks and naming rights. Will it become just the importer of Ucar-Borgwards?

 

[Leo]

I've read some reports about a Starbucks-like chain of coffee restaurants called Luckin Coffee is in trouble after some high ranking managers fabricated revenue numbers. Luckin Coffee is owned by the same holding that owns Ucar and thus Borgward. When Ucar acquired a majority stake in Borgward it also took on the debt of the company and now it looks like there may be problems in satisfying that debt.

More about the story:
https://www.caixinglobal.com/2020-04-10/new-stress-signs-appear-in-luckin-boss-car-empire-101541178.html
https://www.yicaiglobal.com/news/china-largest-car-rental-firm-has-value-halved-by-link-with-fraud-hit-luckin-coffee

 

[Leo]

Yes, it seems to be a rather messy situation. I had already read this rather critical analysis of BAIC's purchase of CAR shares:

https://www.autonews.com/china-commentary/why-beijing-bailing-out-car-inc

It looks a lot like BAIC is bailing out mr. Charles Lu Zhengyao from his questionable business practices. Or maybe it's just trying all that it can get for the defaulted payments on Borgward before mr Zhengyao's empire collapses all together.