Research On The Working Capital Management Of Changan Automobile Company

Since the reform and opening-up,China’s economy has grown rapidly,and the scale of automobile industry has been continuously expanded,which has become an important part of the world’s automobile industry and plays a pivotal role in international status.However,the automobile industry is facing a severe situation of intensified competition under the multiple backgrounds of slowing down the global economic growth,relaxing the ratio of foreign shares in China,and lowering the import tariffs on automobiles.Working capital is the remaining capital of current assets after deducting current liabilities,and it is the most dynamic asset in enterprise assets.It is regarded as the “ blood ” of enterprise flow,therefore,to a certain extent,the success or failure of enterprise operation is determined by the management of working capital.At the same time,the automobile manufacturing industry has the characteristics of long production cycle and complicated production process,so the management of its working capital is very important.Combined with the above background,the purpose of this paper mainly analyzes the performance of working capital management in current automobile industry by using channel theory and related financial indicators,so as to enrich the theoretical research of working capital management.Specifically,this topic uses the literature research method to summarize the research status of working capital management,takes Chang’an Automobile,which has the best development of its own brand and is among the top four big automobile groups in China,as the specific research object,and analyzes the working capital management of Chang’an Automobile’s relevant financial data in recent five years from the perspectives of working capital elements,channels and composition ratio,so as to understand the current situation and existing risks of its working capital management.And compare it horizontally with SAIC,the largest auto listed company in the domestic A-share market,and the average value of the same industry by using the comparative research method.By summarizing the advantages and disadvantages of Chang’an Automobile’s working capital management,it is found that Chang’an Automobile has many problems,such as “notes payable and accounts payable are at a high level and over-reliance on suppliers;The amount of bills receivable is large and there are too many credit sales behaviors;The proportion of goods in stock is too high and the marketing model is Lack of innovation”.In view of these problems,the paper finally puts forward a lots of practical suggestions,such as “optimizing the payment policy and strengthening supplier management;Adjust the collection policy and strengthen credit management;innovate the business model”,so as to improve the working capital management ability of Chang’an Automobile,promote the long-term development and provide reference for the research of working capital management of other automobile enterprises.