Guangzhou Fiat Chrysler Automobiles Co., Ltd. (GAC Fiat) announced on July 8th that the company has been declared bankrupt by the Changsha Intermediate People’s Court due to insolvency and lack of conditions for restructuring and reconciliation.
According to the civil ruling of the Changsha Intermediate People’s Court, the total amount of verified debts by GAC Fiat is approximately 8.123 billion yuan. Of this, the total debt amount confirmed by the court without objection is around 4 billion yuan. As of the date of bankruptcy application acceptance, the company’s total asset amount is about 3.894 billion yuan. Furthermore, according to the evaluation report issued by Hunan Qiushi Land Real Estate Appraisal Co., Ltd., as of the date of bankruptcy application acceptance, GAC Fiat’s assets mainly consist of inventory, fixed assets, construction in progress, long-term deferred expenses, intangible assets, with a liquidation value evaluation of approximately 1.915 billion yuan. Thus, GAC Fiat’s assets are insufficient to settle all debts.
The ruling stated: “As GAC Fiat is unable to pay maturing debts and its assets are inadequate to settle all debts, and does not have sufficient conditions for reconciliation, it meets the legal conditions for bankruptcy declaration… Declaring the bankruptcy of Guangzhou Fiat Chrysler Automobiles Co., Ltd. This ruling is effective immediately.”
The date shown on the ruling is June 14, 2025.
It is reported that the “Bankruptcy Property Distribution Plan” proposed at the GAC Fiat creditors’ meeting has been approved, and the bankruptcy property distribution work will be completed soon.
Public records show that GAC Fiat was jointly established in 2010 by Guangzhou Automobile Group and Stellantis Group with a 50:50 shareholding ratio, with a total investment of approximately 17 billion yuan. Its headquarters are located in Changsha, Hunan, and factories are established in Guangzhou and Changsha. Starting from 2018, GAC Fiat’s sales have been on a continuous decline.
According to Securities Times website on July 8, as of September 30, 2022, GAC Fiat’s total assets were 7.322 billion yuan, total liabilities were 8.113 billion yuan, with an asset-liability ratio of 110.80%. The assets are insufficient to repay all debts and lack clear repayment capability. As of September 30, 2022, Guangzhou Automobile Group had a total of approximately 1.035 billion yuan in receivables due to entrusted loans and various business transactions with GAC Fiat.
In recent years, despite efforts by GAC Fiat’s shareholders to take active measures and multiple capital injections, the operational effect has not improved, leading to a complete standstill in production and operations.
According to First Financial on July 8, in October 2022, due to poor management and the inability of actual assets to repay all debts, GAC Fiat officially entered bankruptcy proceedings. In the following nearly three years, GAC Fiat auctioned off over 3,000 items including molds, test vehicles, among others, but the road to restructuring remains uncertain. Additionally, despite five public auctions of core assets such as land, buildings, and production equipment owned by GAC Fiat, they have been left unsold due to lack of bidders.
Industry analysts point out that GAC Fiat’s Changsha plant focuses on traditional fuel vehicle production, which contrasts with the rapid development of new energy vehicles. Any potential acquirer looking to produce new energy vehicles would need to make additional investments to restructure the production line. Therefore, acquirers will carefully evaluate the initial investment costs and future returns.