Chapter 917: A $5 billion expansion plan
Regarding the expansion of the bicycle production base, Su Rui has already thought clearly.
Lightspeed Machinery Manufacturing Company's future bicycle products cannot only be road bikes, there will definitely be other types of bicycles.
This means that the annual sales of bicycles in the future of Lightspeed Machinery Manufacturing Company cannot be only 10 million, and it will definitely be higher than this sales, so the current production capacity will naturally not be able to meet the future development needs.
Therefore, the production scale of the bicycle production base must be expanded.
And judging from the momentum of the lightspeed bike, this expansion plan must also be carried out as soon as possible, not for too long, the sooner the better, so that the maximum value can be played.
Therefore, Su Rui has decided that the bicycle production base must be expanded.
It's just that regarding the scale of this expansion plan, he feels that it must be seriously considered, and it cannot be decided casually.
Regarding this problem, Su Rui believes that Shen Qing will understand the situation better than him and know the actual needs of Lightspeed Machinery Manufacturing Company.
Therefore, he asked Shen Qing to communicate on this issue, and finally decided on the plan.
After the exchange between the two, the expansion plan of this bicycle production base is to increase the annual production capacity of 40 million vehicles, plus the 10 million units that have been planned itself, which means that as long as this production base is fully put into production, it can achieve an annual output of 50 million bicycles.
Of course, the annual production capacity of 10 million vehicles has been increased to 50 million vehicles, which is equivalent to five times the original one, and the investment required is not low.
According to this plan, it is estimated that 5 billion yuan will be needed to complete this expansion plan.
However, this bicycle production base can meet the vast majority of bicycle parts production, which means that most of the spare parts can be produced and sold by themselves, without the need for external procurement, which is a great cost saving, and at the same time, there is no need to worry about being limited by spare parts manufacturers such as Meima Group, and can have a higher degree of freedom, without being affected and controlled by other enterprises.
The most important thing is that this bicycle production base will be more advanced than similar production bases, and has greater advantages in terms of manpower and management costs.
Therefore, although the investment in this bicycle production base is large, it is not unreasonable, and it is worth investing in compared with the future benefits.
The investment amount of 5 billion yuan is indeed a very large number, which can be said to be an astronomical amount for ordinary enterprises, and it is impossible to get a number at all.
For Lightspeed Machinery, it is also an unaffordable number.
After all, the profit of Lightspeed Machinery Manufacturing Company looks very good, with a profit of 60 million yuan a day, but if you take into account the fact that Lightspeed Machinery Manufacturing Company is only profitable today, the 5 billion yuan is an unaffordable number.
Not to mention the lightspeed machinery manufacturing company, now can't take out this money, even if it is a life group, there is no way to come up with 5 billion yuan in a short period of time, because other subsidiaries also need funds to develop, it is impossible to invest all the funds in order to lightspeed machinery manufacturing company, which is impossible.
Fortunately, though, the expansion plan requires an investment of $5 billion, but it is not a one-time investment.
Such a large investment is naturally impossible to complete in the short term, but will be a long-term plan, which does not require an investment of 5 billion yuan in the early stage, but according to the phased investment, invest funds at the specified time, and the plan will not be delayed.
Therefore, Life Group only needs to invest hundreds of millions of yuan in the early stage of start-up capital to start this expansion plan, and the follow-up funds may no longer need Life Group to provide, but according to the profits of Lightspeed Machinery Manufacturing Company, it is enough to complete the rest of the expansion plan, and even amateur profits to develop other businesses, you can also hand over profits to the headquarters.
According to the profit of 60 million yuan a day, it will exceed 20 billion yuan in that year, and it is more than enough to complete the expansion plan of 5 billion yuan.
Even if the current output of the bicycle production base is not enough to achieve a profit of 60 million a day, even if it is only calculated according to the sales of 10 million vehicles a year, the total profit has reached 6 billion yuan, which is enough to complete the funds required for the expansion plan.
Therefore, regarding this 5 billion yuan expansion plan, it is still not a problem for Lightspeed Machinery Manufacturing Company.
An investment of 5 billion yuan can increase the annual production capacity of 40 million vehicles, which is equivalent to creating 40 billion yuan according to the current retail price of light-speed bicycles, and if the profit is 600 yuan, you can also get a profit of 24 billion yuan.
When this bicycle production base is put into use, the annual production capacity can reach 50 million, which can create an output value of 50 billion yuan, and the profit will also reach 30 billion yuan.
It can be said that although the investment amount of this 5 billion yuan expansion plan is large, as long as it can be completed, within one year of putting into use, all the investment can be recovered, and it can also have a not low rate of return, which is still according to the lowest estimate, in fact, it should be able to achieve a return several times more than the investment.
For this expansion plan, Su Rui is still very optimistic.
The annual production capacity of 50 million bicycles seems to be a high number, and it is also a sales volume that many bicycle companies cannot achieve, but he still believes that Lightspeed Machinery Manufacturing Company can achieve this goal.
Perhaps, in the first year, Lightspeed Machinery Manufacturing Company could not complete the sales target of 50 million vehicles, but in the second year, or in the third year, Lightspeed Machinery Manufacturing Company must be able to achieve it, which is the future sales target of Lightspeed Machinery Manufacturing Company, and Su Rui is also confident in this.
What's more, Lightspeed Mechanical Manufacturing will definitely launch different types of bikes in the future, and there won't be just one road bike.
Therefore, this annual sales target of 50 million units, for the lightspeed machinery manufacturing company, there is still a lot of hope that can be achieved, other bicycle companies can not do, does not mean that the lightspeed machinery manufacturing company can not do, because the lightspeed machinery manufacturing company has more advantages than peers.
Because of this, Su Rui and Shen Qing have made such a decisive decision now, immediately approved this expansion plan, and are ready to start it in the near future.
For the future of Lightspeed Machinery Manufacturing Company, Su Rui and they are still very much worth looking forward to, and they may be able to continue to create miracles, such as miracles like lightspeed bicycles, which should appear again and can also promote the development of the entire industry.
When the industry undergoes a major reshuffle, it also gives the industry the opportunity to progress, and the company that does not stand still and has no way to keep up with the changes will be eliminated!