Autos: a Desperate Capital Grab for Jianghuai, and Dongfeng’s Silly South Africa Plans 汽车业：江淮增发东风出口

It seems Chinese automakers know a major slowdown is in the air at home, and are revving up for it by doing just about anything to buffer their cash reserves. In one piece of news, we learn that Jianghuai Auto (Shanghai: 600418) is looking to raise a hefty $426 million by offering new shares, saying it needs the money for expansion (English article; Chinese article). In the second piece of news, we hear Dongfeng Motor （HKEx: 489), Honda’s manufacturing partner in China, is revving up for a major export drive to South Africa, where it is setting up its first overseas sales company. First Jianghuai, also known as JAC: this company is NOT a top name in China autos, and any savvy investor would stop to think why a second-tier player might be looking for so much cash. As to Dongfeng, having a big name like Honda behind it certainly won’t hurt in its export drive, and South Africa could be just the kind of sort-of developed market that could be fertile ground for its exports. Still, this move also smells a bit of desperation, as China’s domestic car market shows fresh signs of slowing.

Bottom line: Jianghuai’s massive capital raising won’t attract much interest from savvy investors, while Dongfeng’s drive into South Africa will provide minimal returns in the near-term.

山雨欲来风满楼。为应对即将到来的行业减速，中国汽车企业纷纷充实自己的现金储备，无所不用其极。

例如，江淮汽车<600418.SH>计划通过增发股票筹集高达4.26亿美元的资金，称将用其扩张产能。另外，东风汽车<0489.HK>称计划向南非大量出口汽车，并将在那里建立自己的第一个海外销售公司。

关於江淮，精明的投资者会发问：为什麽一家中国二线汽车企业需要如此之多的现金？ 至于东风，作为本田的中国合作夥伴，在扩大海外销售方面或可获得本田一臂之力，而南非可能也正是适合东风产品出口的半发达市场。随着中国国内汽车市场显露出新的颓势，出口南非恐怕也是不得已之举。

一句话：江淮的大笔融资，对精明的投资者来说恐怕没什麽吸引力。东风向南非出口在短期也不会获得多少回报。