Insider of FAW executives’ corruption case： Opening an Audi 4S shop costs tens of millions of dollars.

　　[Cover Story] FAW Corruption Case: Selling Super Big Brother in Jianghu

　　China Economic Weekly reporter Zhang Wei | Comprehensive report

　　In June 2012, Jing Guosong, the former deputy general manager of FAW-Volkswagen Sales Company, was taken away by the discipline inspection department of Jilin Province for investigation due to economic problems. The investigation results showed that Jing Guosong was involved in tens of millions of yuan.

　　Since the Jing Guosong case, in the past three years, many FAW executives have been investigated, and the insider of FAW executives’ corruption has gradually surfaced.

　　Jing guosong’s 4S channel gold absorption

　　No matter when the automobile market is in short supply, or when the supply exceeds demand in recent years and the overall capacity is over-capacity, due to the scarcity of resources, joint-venture brands and imported luxury cars continue to sell well in China automobile market, and 4S stores have always maintained a high return on investment, and Audi 4S stores are recognized as a "steady profit without loss" business.

　　However, it is not easy to pass the dealer qualification examination and approval of the manufacturer, get the right to sell and open an Audi 4S shop. According to industry sources, if you want to open a 4S store, you must "run a lot of factories" and apply for an Audi 4S store. The cost of "running a lot of shops" generally ranges from 6 million to 12 million yuan. The objects that need to be handled include not only the top person in charge of the manufacturer who has the power of final signature and approval, but also foreign joint ventures and "brokers".

　　As the deputy general manager who has been in charge of the sales power of FAW-Volkswagen for a long time, Jing Guosong is undoubtedly the key figure who needs to be "managed".

　　According to media reports, in the spring and summer of 2011, the chairman of a large automobile city in a southern province organized a huge team of dozens of people to deal with the channel construction department of FAW-Volkswagen Audi in order to open an Audi 4S store. After several million yuan of operating expenses and nearly one year of public relations efforts, "Heaven went to the ground, all parties appealed, and finally succeeded."

　　According to some media reports, Jing Guosong probably didn’t get things done because he received money, and was finally reported to the public.

　　After Jing Guosong was investigated, the media excavated and exposed the situation of illegal profit-making in FAW-Volkswagen through the 4S shop channel, calling it "each has its own brilliant idea".

　　For example, people at the real power level have the right to approve slips (providing tight goods directly to designated 4S stores in large quantities), models (specially approving best-selling models for designated 4S stores), discounts (for example, 20% off gold cards for all models of FAW-Volkswagen), and turn "non-commodity cars" into commercial cars, or turn "commodity cars" into knock-off cars (that is, defective cars after collision), which are shoddy, or

　　The so-called "non-commodity car" refers to the indirect commodity circulation car formed by car companies’ test drive, road test, parts and technical test, Shang Yan and accidental bump, or normal probability damage.

　　Some media reported that after Jing Guosong was investigated, there were more than 10 people involved in FAW-Volkswagen and FAW Group, involving more than 100 million yuan.

　　The hot Zhou Yongjiang,"Taking him is equal to making money."

　　Less than half a year after the impact of the Jing Guosong case on the public dispersed, the corruption case of FAW started to stir again. In April 2013, some media reported that several senior executives such as former general manager of FAW-Volkswagen Sales Company and former deputy chief economist of FAW Group Zhou Yongjiang were taken away for investigation.

　　The corruption of Zhou Yongjiang, once known as the founder of Jetta Myth, is also related to car dealers.

　　In September 2014, Zhou Yongjiang was convicted of accepting bribes and sentenced to 15 years in prison by the Higher People’s Court of Jilin Province. Xiong Wei, his longtime colleague and former general manager of Beijing Penglongxing Automobile Service Trading Co., Ltd. (now renamed Beijing Penglongxing Automobile Trading Co., Ltd.), a wholly-owned subsidiary of Beijing Automobile Group Co., Ltd., was sentenced to 12 years in prison.

　　The court found that Zhou Yongjiang and Xiong Wei received a total of more than 18 million yuan in bribes, most of which came from car dealers.

　　According to media reports, a businessman from Hunan named Jiang Zongping is the main briber shared by Zhou Yongjiang and Xiong Wei. Zhou Yongjiang’s wife and Xiong Wei’s wife are shareholders of an automobile sales and service company controlled by Jiang Zongping; From 2007 to 2012, the company paid a total of 7.99 million yuan and 3.77 million yuan in "dividends" to Zhou Yongjiang and Xiong Weijia. In addition, Zhou Yongjiang and Xiong Wei each took several separate bribes. The bribers came from more than 10 companies in 9 provinces including Henan, Guangdong and Beijing.

　　Zhou Yongjiang and Xiong Wei took advantage of their positions to help bribers in the approval and operation of FAW-Volkswagen, FAW Audi 4S store and Beijing Mercedes-Benz dealer.

　　Like Jing Guosong, Zhou Yongjiang and Xiong Wei, who hold the approval authority, are equally hot. An industry insider admitted to the media: "Winning them, including people in similar positions in other auto companies, is basically equivalent to making money, which is almost a’ semi-open secret’ in the industry."

　　Playing "Three Tigers" again is also related to sales.

　　At the end of July, 2014, the 13th Central Inspection Team began a one-month special inspection tour of FAW Group, during which three more senior executives of FAW Group were dismissed.

　　On August 26 and 29, 2014, the website of the Supervision Department of the Central Commission for Discipline Inspection released news that Li Wu, former deputy general manager of FAW-Volkswagen and general manager of the sales company, and Zhou Chun, deputy general manager of FAW-Volkswagen Audi Sales Division, were put on file for investigation for serious violations of the law, and Andrew Wu, former deputy general manager of FAW Group, was investigated for serious violations of the law. Among them, when Underwood was investigated, he had retired for 6 years.

　　The above three people have been responsible for the automobile sales of FAW.

　　Underwood retired in 2008. He served as assistant general manager and deputy general manager of FAW Group, and also served as the chairman of FAW Mazda Automobile Sales Co., Ltd..

　　When the consumption of private cars rose in 2002 and 2003, the FAW-Volkswagen sales company headed by Li Wu had unlimited scenery, and the most beautiful day was the launch of the new Audi A6L in 2005. Some analysts said that Zhou Chun’s previous highest position was the deputy general manager of FAW-Volkswagen in charge of the network, and earlier he was the deputy general manager of FAW-Volkswagen Audi Sales Division. According to the position announced by CPC Central Commission for Discipline Inspection, Zhou Chun’s accident should be mainly related to his charge of Audi.

　　Some media reported that the investigation of the above three senior executives may be related to the Jing Guosong case exposed in 2012.

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