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China Southern Power Grid "blacklists" Great Wall Motors, deeming it a major breach of trust and having a bad impact

2024-08-20

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Recently, there are media reports that China Southern Power Grid has included Great Wall Motors in the "list of bids not accepted"! The reason for the determination is: the supplier has committed a major breach of trust, and the impact is bad. Treatment measures: do not accept bids...



  • What is going on?

On August 19, according to the unified service platform of the State Grid Corporation of China's supply chain, the State Grid Corporation of China issued a supplier processing announcement (No.: [2024] 009), in which Great Wall Motor Co., Ltd. was listed as a "supplier not accepted for bidding" by the State Grid Corporation of China due to "serious breach of trust by the supplier, with adverse impact". The processing period is 24 months.



It is understood that China Southern Power Grid and Great Wall Motors have previously cooperated in multiple businesses. As early as 2019, China Southern Power Grid joined Great Wall Motors' "Eura Super Charging Alliance" as one of the first members.

However, in recent years, there has been little business cooperation between the two sides.It is worth noting that while Great Wall Motor's pickup truck products have a market share of nearly 50%, the State Grid Corporation of China rarely purchases Great Wall Motor's products in its pickup truck category purchases.At the same time, Great Wall Motors has won bids for pickup truck procurement projects from the State Grid and Inner Mongolia Power Grid many times.

This time, the State Grid Corporation of China announced that it had blacklisted Great Wall Motors from bidding. In fact, it was not just Great Wall Motors that was blacklisted, but 37 companies and individuals, most of which were suspected of collusion in bidding, disrupting the bidding order, falsifying documents, and violating integrity commitments.



Only Great Wall Motors isCompanies that were rejected from bidding because of "serious breach of trust by suppliers with adverse impact"The announcement shows that the company is not allowed to bid for any projects within the scope of the Southern Power Grid.



Netizens have been discussing this matter, and most of them seem to stand on the side of Great Wall Motors and speak out for it.

Some netizens said that if the dealer offended the State Grid Corporation of China, they should not blacklist Great Wall Motors. The State Grid Corporation of China should not bully customers because of its size! The State Grid Corporation of China is a state-owned enterprise, that is, an enterprise for the people of the whole country, and it should not become a tool for some people to use public power to bully customers.

Some netizens questioned that it was the first time they heard that China Southern Power Grid was piggybacking on Great Wall Motors' traffic! State Grid should take action to rectify these fakes.

Some netizens revealed that the State Grid Corporation of China wanted to offer discounts on repairs and maintenance, so it held a tender. However, all Great Wall 4S stores are part of the same system and must listen to Great Wall. Isn't it ridiculous to hold such a tender?

  • So what exactly caused this incident to happen?

According to media reports, there are two pieces of information that can roughly infer the cause of the incident.



First, Great Wall sold a pickup truck to the State Grid Corporation of China about two years ago.

Great Wall Motors has participated in biddings of companies under the China Southern Power Grid many times. The most recent one was in November 2022, when Great Wall Motors won the bid for the framework procurement of general vehicles (first batch) for the Southern Power Grid Electric Vehicle Service Co., Ltd. from 2022 to 2024. In this bidding, the Southern Power Grid purchased a four-wheel drive SUV from Great Wall Motors.

The second was a maintenance project that failed to sell.

In February this year, China Southern Power Grid (Hainan) Electric Vehicle Service Co., Ltd. publicly tendered for the company's vehicle maintenance project. One of the sub-project bidding requirements specified that the vehicles to be maintained were Great Wall Motors and its affiliated brands, and China Southern Power Grid required bidders to have relevant authorization from Great Wall Motors.According to the announcement released by China Southern Power Grid, the tender was terminated due to insufficient bidders.This may mean that Great Wall Motors and its affiliated companies have given up participating in the maintenance and repair projects of their own brand vehicles.

However, no matter what the cause, this move may lead to a crisis of trust in Great Wall Motors.

The latest data shows that from January to July 2024, Great Wall Motors sold a total of 650,954 vehicles, a year-on-year increase of 3.60%. Among them, new energy vehicle sales were 156,519, a year-on-year increase of 28.14%; overseas sales were 239,685, a year-on-year increase of 58.80%; and sales of models above 200,000 yuan were 163,378, a year-on-year increase of 48.64%.



It is worth mentioning that Dingxin Communications was previously "blacklisted" by the State Grid Corporation of China, resulting in a significant reduction of 8.6 small targets in Dingxin Communications' operating income in 2024, and it is expected to lose 25 small targets in the next two years.



This incident not only caused Great Wall Motors to lose the China Southern Power Grid as a major customer, but it may also have a significant impact on its brand image, market share and even future development. Did the China Southern Power Grid really not consider the consequences of its high-profile boycott of Great Wall Motors?

What do you think about this?