"Transition from Jail to Community" is abbreviated as "TJC", which in Chinese means: "transition from prison to community". It is common in the social field and related to "."
Promoting blunt words can "keep your card"
"Can anyone help me buy a ticket for the Spring Festival Gala, preferably one with a microphone and able to go on stage. I can go up and tell the story of my POS machine." At the end of 2022, Zhao Zhao (pseudonym), an acquiring and payment POS machine agent, posted such a circle of friends.
The story of Zhao Zhao and POS machines began in 2016. During this year, Zhao Zhao began to carry a bag and walk around the streets to sell goods, and gradually developed a deeper relationship with POS machines. Gag-style "jokes" are also advertisements issued by Zhao Zhao to promote POS machines. There are many such contents in his circle of friends.
The agent's main job is to sell POS machines to merchants through various channels, and can obtain corresponding profits based on the card transaction flow generated by the activated POS machines. In the seven years since Zhao Zhao entered the industry, with the adjustment of regulatory policies, the marketing model in the acquiring field has also been constantly changing.
A reporter from Beijing Business Daily learned that telemarketing is one of the main ways for individual users to come into contact with POS machine promotion. By briefly introducing the POS machine brand, card payment rates, machine fees and other information, the telephone customer service conducts a preliminary screening of interested customers. Zhao Zhao told a reporter from Beijing Business Daily that the POS promotion calls received by users are usually not made directly by agents. This type of model is called intra-city work orders in the industry, and on this basis, the off-site electronic sales model is derived.
"Professional telemarketing agencies obtain interested customers by making phone calls, and payment agents receive orders in the form of work order delivery for a fee. They contact customers based on the information provided by the telemarketing company and come to promote POS machines. After that, most agents directly promote POS machines to users in other places by mail." Zhao Zhao explained.
The aforementioned promotion method casts a wide net, which can help agents acquire more customers in a short period of time, and has become the choice of many agents. But Zhao Zhao was unwilling to poke his head into the tiger's mouth and engage in such a risky business. Zhao Zhao said frankly that the first step in intra-city work orders is to buy and sell user information. The user data held by telemarketing agencies is used repeatedly. While there are legal risks, the transaction cannot be maintained for a long time, and it is often deceptive in the nature of one shot for another.
Unable to find customers through shortcuts, Zhao Zhao, like many other agents, left his contact information on public social platforms to accumulate "friends" and constantly posted information about POS machines in his personal circle of friends. "Once someone sends a signal that they want to know about POS machines, agents will rush to them and get their contact information before making further introductions." Zhao Zhao pointed out.
A reporter from Beijing Business Daily further investigated and found that labels such as “card maintenance”, “cash out”, “low rates” and “capital turnover” are high-frequency words in agents’ circles of friends. In some agents’ circles of friends, POS machines are even labeled as “bad debt repair tools.” On public social platforms, due to platform restrictions, agents often use words such as "stable", "personal version" and "no price increase" when promoting.
There are also small advertisements for POS machine agents, which are posted in the elevator of the community where reader Liu Qin (pseudonym) lives in Beijing. They are clearly marked with words such as "You can apply for a POS machine by swiping your card at any time if you have a credit card" and "It's faster to raise your credit card if you have a card." According to Liu Qin, this advertisement is firmly pasted on the left side of the elevator floor button and can be seen by everyone who enters the elevator. "After all, it is illegal to cash out a credit card. I tried to take it off but failed. Some neighbors also used labels to block the QR code for contact, but it was torn off again within a few days." Liu Qin said.
“Strictly review the qualifications of special merchants and standardize the management of acceptance terminals,” this is the clear policy of the regulatory agency. According to the requirements, no unit or individual is allowed to buy or sell POS machines and other acceptance terminals online. Banks and payment institutions should conduct on-site inspections of all physical merchants and check the usage locations of their acceptance terminals one by one. However, judging from the current implementation situation, this provision is almost in name only.
Personal Internet access "lost"
Illegal matching transaction merchants
Business is not doing well.
According to data disclosed by the central bank, in 2022, there were 3.3754 million fewer connected POS machines than the previous year.
Investigating the reason, Wang Pengbo, chief analyst of Broadcom Consulting, said that due to the impact of the epidemic in recent years, the overall economic growth has slowed down, and the demand for POS machines in physical businesses has declined. At the same time, innovation and changes in payment products continue. Alternative products to traditional POS machines are increasing, including direct transfers, mobile payment tags, etc., and new products are more convenient and lower-cost, gradually eroding the usage scenarios of traditional POS machines, and the promotion of POS machines has encountered bottlenecks.
Rampant advertising and marketing also targets a wider group of individual users. It has almost become an open secret in the acquiring field for individual users to cash out at POS machines.
According to information released on public social platforms, a reporter from Beijing Business Daily obtained a Lakala (300773) POS machine from agent Li Yu (pseudonym) without any hindrance at a price of 59 yuan with free shipping, and further tested its activation process. Based on Li Yu's reminder, the reporter registered as a "small and micro merchant" and independently selected the merchant type and name. Store information such as door photos and cashier photos are not required. In the end, with the help of real personal information and false merchant information, the reporter quickly passed Lakala's review and registered as a merchant with a single credit card credit limit of up to 300,000 yuan, with a credit card fee rate of 0.6%.
After completing the registration and activation, the Beijing Business Daily reporter used his own credit card to swipe the card on the POS machine. However, bank transaction details showed that the payee was Beijing Jianwei Xingsheng Clothing Store. The system automatically matched the new transaction information, and the card amount reached the bound account immediately after deducting the handling fee.
During this test, Beijing Business Daily reporters never encountered the widely criticized situation of free POS machines charging deposits. However, based on the interview content, the melee around POS machines also occurred between different agents of the same payment institution.
Li Yu is engaged in Lakala POS machine agency, charging 59 yuan for the machine, which can be refunded after the cumulative transaction reaches 5,000. For the same machine, Zhang Hua (pseudonym), an agent who posted advertisements in Liu Qin Community, asked to pay a deposit of 299 yuan, and said that the charging standards for the POS machines he represents are uniformly between 299 yuan and 300 yuan, and the deposit will be returned after a total of 20,000 yuan is swiped every month for 12 months.
During the communication process, Li Yu "intimately" provided some tips on how to increase the credit limit and maintain the card, and emphatically recommended not to use debit cards at POS machines, as this could easily be judged as money laundering by the system; Zhang Hua emphasized several times that "regular UnionPay registration machines have deposits" and "without a deposit, it is not an official product."
In fact, in the past two years, disputes over POS machine deposits have been reported frequently, and a large number of agents have even used free services as a gimmick to deduct deposits without users' knowledge. In Zhao Zhao's view, these are "cautious tricks" used by agents for their own profits. Agents who swipe debit cards receive less profit, and it is nonsense to say that regular products require deposits.
When it comes to POS machine deposits, Zhao Zhao pointed out that the statement "regular products have deposits" is actually just a way for agents to obtain profits. This is also part of the decentralized authority of payment institutions. Whether POS machines will collect deposits depends entirely on whether the agents have set up deposit deductions. This function is indeed a "livelihood" set aside by payment institutions for agents.
"If some users mind the deposit, then the agent can recommend machines without deposit; if some users don't care about the money, the agent will naturally make more profits. As for the transaction turnover threshold set for refunding the deposit, it is essentially to encourage users to use more POS machines to swipe their cards." Zhao Zhao added.
Regarding the issue of selling POS machines to individual users, Zhao Zhao even admitted frankly that agents are looking for profits, and the demand of real merchants to use POS machines is limited after all. After the POS machines are promoted, how to use them and who will use them are not issues that agents will consider.
Wang Peng, a researcher at the Beijing Academy of Social Sciences and the Intelligent Social Governance Research Center of Renmin University of China, said that cashing out on credit cards is essentially creating false transactions and illegally applying credit card credit limits. Such behavior is separated from the supervision of financial institutions and can easily lead to the transmission of financial risks.
Wang Pengbo pointed out that in principle, individuals, that is, natural persons with no other attributes, cannot handle POS machines where users swipe their bank cards. Only merchants with business activities and consumption scenarios can handle POS machines. However, due to competition and profit considerations, some offline acquirers have relaxed the management of their own or franchised service providers.
In addition, in response to the aforementioned issues related to the direct registration of Lakala POS machines, on March 20, a reporter from Beijing Business Daily also conducted an interview with Lakala. Lakala only responded that the company has strict requirements for merchants to access the network, especially for agents to expand merchant access to the network, and strictly implements the real-name management of merchants to access the network. If cash out, fraud and related risky transactions are discovered, early warning and interception or settlement delay will be adopted to ensure the safety of payments and funds. Regarding the issue of deposits collected by some agents, agents will be urged to return them promptly after the merchants meet the standards.
Wang Pengbo further analyzed and pointed out that illegal matching of merchants is a common method for pure personal cash-out. The fictitious transactions and illegal cash-out behaviors of payment institutions during the use of POS machines are obviously non-compliant.
Intense attack and defense
Rate adjustment involves many parties
"No telemarketing, no cheating, and no cashing out" are the "three no's policies" Zhao Zhao has set for his career. Specifically, they do not promote POS machines through phone calls, text messages, etc., do not use "free" as a gimmick to defraud users of deposits, and do not directly handle cash-out services for customers through their own POS machines.
Each of the "three no's policies" basically points to the chronic diseases of the POS machine industry, but it is also difficult to fully operate within the regulatory red lines. Zhao Zhao said that the competition in the existing POS machine agency market is too fierce. Agents of the same payment institution can provide users with "price lists" of varying amounts. Agents of different payment institutions will also use methods such as switching machines to persuade customers to use their own POS machines.
Switching, in the field of bank card acquiring, mainly refers to agents actively using another brand of POS machine to replace the user's original machine. In the past few years, Zhao Zhao has carried out POS machine promotion services for many payment institutions. Zhao Zhao said: "Changes in agencies will definitely take away all the customers that can be taken away. However, due to factors such as customer usage habits and changes in contact information, this step is not easy."
In the limited market, in order to pursue new customers, agents have also turned their attention to customers on other platforms. This has also caused many payment institutions to complain, and they have to resort to methods such as refuting rumors and issuing risk warnings. On the one hand, they want to retain their own users, and on the other hand, they also prevent users from being deceived by criminals during the phone switching process. On the Lakara POS machine registered by a reporter from Beijing Business Daily, the startup page prompts "Lakara will not ask for equipment change, please be vigilant and beware of being deceived."
Among the commonly used methods of machine cutting, it is more effective to send users information about the deactivation of the original machine, rate increase information, and free replacement of updated POS machines. Among them, the rate increase attracts more attention.
Since the second half of 2022, there has been a lot of news about the increase in card swiping rates at POS machines of payment institutions, and many agents are releasing corresponding information. Advertisements on agents’ WeChat Moments also focus on increasing POS machine rates, prompting users to switch to machines with lower card payment rates. Zhao Zhao pointed out, "For users, as long as it is a formal payment institution, the lower the fee, the better. When other payment institutions raise their interest rates, everyone will rush to promote their own agents' machines."
A practitioner in the payment industry told a Beijing Business Daily reporter that competition in the acquiring field is not only reflected among payment institutions, but also concentrated among agents. Rate adjustments involve many parties, including payment institutions, agents, and users, and are also sensitive to users. Payment institutions should adjust their rates based on the actual conditions of their business development, and should also prevent any impact on existing merchants. In addition, it cannot be ruled out that in the market competition, some agents fabricate information such as rate increases to maliciously cut off opportunities.
In Zhao Zhao's circle of friends, there was a lot of news about the price increase of Lakala POS machines. In response to this situation, Lakala responded that the company's card swiping rate has remained stable as a whole, and the company's overall card swiping rate is still at the level of 6‰ (six thousandths).
Wang Pengbo analyzed that cutting opportunities is vicious competition, which may not only cause market turmoil and damage the overall image of the industry, but may even allow merchants to become accomplices of criminals, causing damage to user funds. In recent years, costs in the acquiring industry have gradually increased, but interest rates have not increased. Overlay market demand has always existed, so even though competition in the industry is fierce, rates are still generally rising.
Expansion and chaos go hand in hand
Agent management cannot be relaxed
The seven years that Zhao Zhao has been engaged in POS machine agent promotion have also been seven years of changes in the payment industry. Regulators continue to draw prohibitive red lines and strictly supervise third-party payments, including POS machines; the five-year license renewal test, coupled with the impact of market competition, continues to reshuffle the payment industry.
Refined to the field of bank card acquiring business, the profit sharing mechanism promoted by POS machines has generated considerable profit margins, attracting more agents to participate, expanding the business territory and making the market more chaotic. Zhao Zhao revealed to a reporter from Beijing Business Daily that during the peak period, his monthly income could reach a maximum of 80,000-100,000 yuan, but now it has dropped significantly and has basically stabilized at 20,000-30,000 yuan.
When it comes to the reasons for the decline in income, Zhao Zhao is also well aware of it. "The threshold for entry into the industry is too low. When there are more people, it becomes chaotic," Zhao Zhao mentioned. "Agents who handle the promotion of POS machines are also very uncertain. They may be handling POS machines this month and promoting credit cards or selling houses next month. Agents only want to make 'quick money', and there is no way to guarantee customer after-sales service."
Wang Peng’s analysis pointed out that judging from the actual operation situation in the bank card acquiring field, different participants such as payment institutions, agents, and users are actually stakeholders, and they have not strictly implemented regulatory requirements, and they have acquiesced to relevant illegal activities to a certain extent. This further promotes the occurrence of POS mechanical sales, cash out and other behaviors.
Various problems caused by agents in promotion also point the finger at the licensed payment institutions behind them. While payment institutions are decentralizing their authority and obtaining benefits, they are also required to bear corresponding review responsibilities for agents and merchant access. A reporter from Beijing Business Daily learned from practitioners in the payment industry that in the second half of 2022, some institutions have begun to restrict some merchants by raising rates, and the adjustment targets are mainly merchants that cannot provide true business information. The purpose of this operation is still to standardize merchant transactions.
Lakala also mentioned in the reply that it has formulated strict agent management measures in accordance with regulatory requirements and industry norms, requiring them to conduct business in compliance, and standardizing agent behavior through daily inspections and compliance training. Once an agent is found to have violated laws and regulations, punitive measures will be taken and its business will be closed immediately, and false propaganda content will be required to be removed from the shelves, and its legal responsibility will be held.
Regarding the current problem of individual users accessing the Internet through the status of "small and micro merchants", Wang Pengbo further explained that in order to meet the business needs of small and micro merchants, regulatory regulations stipulate that merchant types include not only special merchants who have business premises and have gone through industrial and commercial registration, but also include entity special merchants among small and micro merchants who are exempt from industrial and commercial registration in accordance with laws, regulations and relevant regulatory provisions. However, small and micro merchants without a business license must obtain a personal identity document, plus some auxiliary certification materials such as his business location, in order to develop into a small and micro merchant acquiring orders. Only the acquiring agency can provide collection services for basic daily sales operations.
"The convenient payment path provided by regulatory agencies for small and micro merchants should not become a channel for payment institutions to make profits and individual users to cash out. Payment institutions cannot relax their management of agents." Wang Pengbo emphasized.
What should be done to rectify the chronic problems in the bank card acquiring field? Wang Peng gave the following suggestions: First, increase the intensity of investigation and punishment by regulatory authorities and establish diversified reporting methods to maintain market order; second, consolidate the main responsibilities of payment institutions, strictly regulate relevant rules and develop business, and form a standardized way of business development; third, strengthen publicity to the public and emphasize the dangers of using cards to maintain cards and cash out.
"In addition to strengthening management and punishment, the most fundamental issue is how to help third-party payment institutions find new profit growth points and win in the digital transformation." Wang Pengbo added.
Beijing Business Daily Financial Investigation Team
Original Chang Xu China Social Science Network
China is one of the first countries in the world to discover and utilize oil. "Hanshu Geography" records that "Gaonu has water (fertilizer) that can burn", indicating that people had discovered oil in northern Shaanxi more than 2,000 years ago. The names of ancient petroleum include "stone paint", "water fertilizer", "stone fat water", "black sesame oil", "fire oil", "nagar oil", "mud oil", "well oil", etc. Shen Kuo of the Song Dynasty believed that oil was "born in sand and gravel on the water's edge" and "mixed with spring water", so he called it "petroleum". The evolution of these names reflects people's deepening understanding of petroleum. The main uses of ancient petroleum include lighting, ink making, lubrication, antisepsis, medicine and fire attack. In the early days, oil was mainly collected. After the Song Dynasty, my country began to dig oil wells to collect oil. By the Ming Dynasty, well salt industry drilling technology was also applied to drilling oil wells. However, before modern times, China's oil extraction and utilization technology was still very primitive.
After the 1870s, the Westernization faction of the Qing government tried to exploit oil deposits, such as the Miaoli Oil Mine in Taiwan, the Yanchang Oil Mine in Shaanxi, and the Dushanzi Oil Mine in Xinjiang, but they did not develop. After the Revolution of 1911, Sun Yat-sen pointed out in "Industry to Save the Nation" that "China is also known as a country rich in kerosene production. Oil sources have been discovered in Sichuan, Gansu, Xinjiang, Shaanxi and other provinces...China has such minerals, but it cannot be exploited for its own use. It is a pity that the kerosene, gasoline, etc. imported from foreign countries are increasing every year."
Most of the oil consumed in China in modern times is imported. There are four main categories of petroleum products: kerosene (Kerosene Oil), lubricating oil (Lubricating Oil, or Engine Oil, Machine Oil, etc.), gasoline (Gasoline, or Naphtha, Benzine, etc.), and diesel (also known as fuel oil, Liquid Fuel). Kerosene (commonly known as "foreign oil") is mainly used for lighting, and has penetrated into the urban and rural markets along China's coast and inland, so that "foreign oil" is used in remote areas. This article mainly discusses the transportation, sales and consumption of "kerosene" from 1863 to 1937.
“Foreign oil” enters the Chinese market
Traditional Chinese lighting mainly uses vegetable oil. Kerosene entered China in 1863. The amount imported that year was 2,100 gallons (US gallon, 1 gallon equals 3.7854 liters), exclusively for lighting in the concessions. Since then, the scale of kerosene imports has grown rapidly, reaching 23 million gallons in 1886 and 100 million gallons in 1893. Zhenjiang's business report for 1882-1883 noted that in 1882 "kerosene was already widely used in a considerable area around the treaty ports...Every village has cheap kerosene lamps." Zhenjiang's business report in 1886 also said: "Many industries that used to stop working after dark now work at night, and poor scholars can also light kerosene lamps at night... Shoemakers, grinders, tailors and carpenters all use oil lamps at night." Kerosene gradually spread to all treaty ports and cities, and entered cities and rural areas in mainland China. It was accepted by all classes of Chinese society and became a necessity for production and life.
The rapid growth of kerosene imports is not only due to the economic and political privileges that Western powers seized in China after the Opium War, but also related to other reasons. First, kerosene is brighter and cheaper than traditional vegetable oil or candles. For example, in 1879, in the Hankou market, camellia oil cost 5 taels and 6 yuan per quintal, cannabis oil cost 5 taels and 4 yuan per quintal, and kerosene only cost 2 taels and 8 yuan per quintal. Secondly, the supply of vegetable oil used in traditional lighting in China is not guaranteed. When agricultural harvests fail, oil crops are often used as food rather than for oil extraction. Again, kerosene lamps were freely available or cheaply manufactured. In order to promote kerosene to mainland China's cities and rural areas, Mobil Oil Company developed a can-type kerosene lamp with a glass shade that was delivered free of charge as long as kerosene was purchased. As a result, homemade simple kerosene lamps also appeared in China.
Changes in the way kerosene is transported and sold have reduced its costs and, to a certain extent, reshaped the pattern of kerosene trade. Before the 1890s, kerosene was usually packaged in a 5-gallon can or two cans in a box, shipped to various ports in China by ship, and unloaded into warehouses for sale. This shipping method has limited transport capacity and is expensive to load, unload, and store. In 1894, the Shell Oil Company transported 3 million gallons of kerosene to Shanghai in a tanker, thus starting the import of bulk kerosene. Oil tankers directly transport bulk kerosene to treaty ports, and then the oil is introduced into oil pools for storage. The kerosene can also be transported to other places via railway tankers. As a result, kerosene formed a combined transportation system of sea, waterway and railway. A factory for manufacturing wooden boxes and tinplate cans for storing oil was also established near the oil pool to facilitate canning, transportation and sales.
This new transportation and marketing method received preferential taxation and management, and the General Taxation Department of Customs issued circulars for this purpose, such as the "Measures for Taxation of Re-Transportation of Imported Bulk Kerosene" in July 1894 and the "Special Chapter for Kerosene Pools" in March 1895. The "Special Chapter for Kerosene Tanks" stipulates the management regulations for the construction of kerosene pools. It stipulates that kerosene stored in closed warehouses will be levied an export tax when it leaves the warehouse. If the kerosene is stored in non-closed warehouses, import taxes should be paid when it is brought in. Therefore, "Guanzhan" has the characteristics of a bonded area. The 1897 Jiangguan Customs Trade Report described the sales of bulk kerosene: "There is a pond factory in Pudong so that the goods can be unloaded and stored in the pond at any time without having to pay the tax first; when they are sold, they will be counted and levied. Its value will be calculated according to the silver market."
The core competitiveness of kerosene - price and brightness - has given it a firm foothold in the Chinese market. "No matter how difficult the times are, it cannot stop its booming sales (fire, water, oil, tap fire), which seems to be the same as the seven things that open the door to the home." At the end of the 19th century, foreigners in China believed that "when the Chinese find a commodity that is both suitable for their needs and suitable for general consumption, and the price is within their financial resources, the demand of the Chinese is great. The Chinese are undoubtedly conservative, but once they believe that they must abandon their old habits and prejudices for their own interests, they can easily do so." No wonder Chen Chi, the author of "Strategies to Continue Prosperity", exclaimed: "Oils from Russia and the United States were sold into China and spread like wildfire. They became popular in various ports. As a result, in addition to foreign medicines and foreign cloths, there were endless loopholes."
The competition of various brands in the modern market
The American Mobil Oil Company was the first to enter China and completely monopolized the early kerosene market. In 1888, Russian kerosene entered the Chinese market. In 1889, the customs classified and counted kerosene according to its place of origin. Only Beihai and Mongolia Customs had no records of Russian kerosene imports, which shows how quickly it entered the Chinese market. Sumatra kerosene was first imported in 1893, Borneo kerosene also began to enter China in 1901, and Myanmar kerosene was imported for the first time in 1904.
Although American kerosene monopolized the early kerosene market, Russian and Sumatra kerosene could still quickly enter the Chinese market and occupy a larger market share because their oil prices were lower. Among the three types of kerosene, the price of American kerosene was the highest. From 1889 to 1904, it was on average 0.19 customs taels per 10 gallons higher than that of Russian kerosene. The price of Sumatra kerosene was slightly lower than that of Russian kerosene. In the early days when Russian kerosene entered the Chinese market, American kerosene had a price-cutting competition. In 1894, the price was even slightly lower than that of Russian kerosene, but it later recovered and maintained the original price difference. From a price point of view, 1901 and 1902 were the key periods for Sumatran kerosene to seize the Russian kerosene market share. The average price in these two years was actually 0.25 and 0.27 customs liars lower than Russian kerosene per 10 gallons.
In terms of kerosene brands, the quality of American kerosene, such as "Devoe's Brilliant" and "Warden", is significantly better than that of Russia's "Anchor" and Sumatra's "Crown". The quality of Russian kerosene varies. Some of the kerosene contains high sulfur content and corrodes the iron cans, so it cannot be stored for a long time. If the can is opened for a long time, the brightness of the kerosene will weaken. There is a lot of smoke, more heat but less brightness. Judging from the competition between American and Russian kerosene at various ports, after a short-lived boom, Russian kerosene gradually regained the market from American kerosene. At some ports, Russian kerosene was even put into American tanks and sold as American kerosene. Sumatran kerosene appears to be of slightly better quality than Russian kerosene and is less expensive. A large part of Russian and Sumatran kerosene was transported to cities and villages in the vast interior beyond the treaty ports. This is because there, price is the main deciding factor. The 1914 Jianghanguan Trade Report discussed kerosene from various sources, divided the grades of kerosene, and discussed the sales market of each grade of kerosene:
It should be noted that there are grades of oil used in China: the first is high-grade oil, such as American and Persian tank kerosene; the second is medium-grade oil, such as Mobil's Eagle tank kerosene and Asia's Sumatra kerosene; the third is third-grade oil, such as Polo Island kerosene; and the fourth is vegetable oil such as Chinese rapeseed and peanut. Ordinary people tend to prefer cheap prices, but they like the combination of light and energy. Therefore, medium-priced Sumatra kerosene and Mobil cabin kerosene are the easiest to sell, but high-grade and third-grade oil can be slightly reduced. These two items may still be sustainable, because high-grade oils can find new sales markets, and third-grade oils can gradually crowd out local vegetable oils. However, the medium-sized Mobil and Sumatra kerosene are moving smoothly and are stable.
Distribution by the three major oil companies
In China's modern kerosene market, the three most important oil companies are Mobil Oil Company and Texaco Oil Company of the United States, and Asia Oil Company, a joint venture between Britain and the Netherlands. Among them, Mobil is the oldest and largest, followed by Asia, while Texaco is smaller and the last to enter the Chinese market. In the early days, major oil companies mainly operated through foreign agents. At the end of the 19th century, foreign banks began to be directly established in China, relying on the comprador system to sell oil. At the beginning of the 20th century, in order to better control sales, branches began to be set up in China and a directly controlled distribution system was implemented.
Take Mobil, for example. After the Shanghai office of Mobil Oil Company was established in 1894, Sanda Oil Company was established in 1900 (Sanda is the transliteration of "Standard"). In 1901, the foundation of the oil stack was purchased in Shanghai, and the oil stack was built in 1903. After that, Mobil Oil Company expanded to the mainland and successively set up branches and offices in various places. Mobil established its head office in Shanghai (also known as the "head office"), and established 6 district companies (also called "district branches") in Shanghai, Nanjing, Tianjin, Qingdao, Hankou and Guangzhou. The district companies also have branch companies (also called "branch branches"), and under them there are branch companies (also called "sub-branches"). Below the branches, Chinese businessmen at all levels act as dealers, taking advantage of China's original urban and rural business networks and extending their marketing systems to all parts of the country.
In order to facilitate transportation and marketing, Mobil Oil Company has set up large oil pools and oil stacks at important trading ports such as Shanghai, Tianjin and Hankou, as well as auxiliary factories for manufacturing kerosene barrels (50 gallons) and kerosene cans (5 gallons). Other ports generally also have oil storage pools and can factories. The company also has a specialized transport fleet of tankers and oil barges, as well as oil tankers and oil stacks. Mobil Oil Company also had factories that manufactured kerosene lamps, glass lampshades, and more.
The three major oil companies, Mobil, Asia and Texaco, have completely monopolized China's oil import and sales market through their sales networks throughout China. The competition between the three companies in the Chinese oil market is extremely fierce and they often start price wars. Later, the three companies increasingly adopted a joint strategy to carve up the market and jointly squeeze out other small oil companies.
Mobil established an oil lamp factory in China and first opened up the market in mainland China and rural areas by giving away mast lanterns, table lamps, lampshades, etc. In order to capture the market, Asia Oil Company sold half of the kerosene and half gave it away. In 1905, China launched a boycott of American goods, and Asian oil companies took the opportunity to compete for the oil market at low prices. Before World War I, Mobil gradually reduced comprador commissions and distributed them to salesmen, hoping to gradually establish a directly controlled sales network. Asia Petroleum Corporation has adopted a tit-for-tat system of heavy use of compradors in order to seize the market. When Texaco Oil Company first entered the Chinese market, Mobil Oil Company and Asia Oil Company jointly used low-price dumping to squeeze it out. Texaco responded "tit for tat" by setting lower prices, and it took a year or two of hard work to gain a firm foothold. Texaco also launched a publicity campaign, placing large advertisements in newspapers and publications in major cities in China, mailing promotional materials, and giving away calendars and other souvenirs. In addition to obvious price wars, they also have endless "secret wars", such as trying to win over dealers, winning over big customers and buying off each other's staff.
In order to jointly carve up the Chinese market, the three major oil companies have also adopted a cooperative approach to agree on the annual sales ratio in each region. For example, in the North China market, the average sales over the years are approximately: 40% for Mobil, 25% for Asia, and 35% for Texaco. The three major oil companies have also agreed on specific measures to maintain this ratio: for example, the number of agency stores for each oil company must not be increased or decreased at will, and the sales volume must also be limited. For the oil used by large customers, such as government agencies, industrial and mining enterprises, etc., the three companies have agreed to take turns supplying oil using the "bid-combining" method, that is, they meet and negotiate before bidding each time to determine who will supply the oil. During the bidding, the other two companies deliberately raise the bid price so that the third company can win the bid. Even if there is a temporary buyer, the three companies must negotiate to determine the underwriter. In order to enforce their market shares and agreed prices, the three major companies also each hired investigators to secretly investigate the import and sales data of the other two companies at various terminals, stations, warehouses and important marketing areas to conduct mutual supervision.
When facing competitors, the three major oil companies always coordinate their operations and spare no effort to completely crush them. For example, in 1925, the American Daming Kerosene Company was established in Tianjin and prepared to promote the "Silver Box" brand kerosene. It was immediately boycotted by the three major companies and was merged with Texaco. In the same year, a British employee of the Guangzhou branch of Mobil established the Hu Brothers Company in Hong Kong, ordered kerosene from American independent oil merchants, and created the "Butterfly" brand of kerosene. Compared with Mobil, the price was cheaper and the quality was similar, so it became popular. The three major oil companies jointly lowered prices, causing it to go bankrupt. As for the Guanghua Petroleum Company, which was run by Chinese businessmen, they tried their best to lower prices and suppress them. Due to serious losses, Guanghua Fuel Oil Company had to sell all its oil pools and oil warehouses to three major companies.
In 1928, China's kerosene imports were 263 million gallons, an increase of only 11.4% compared to the pre-World War I peak of 236 million gallons in 1911. This actually reflects the basic trend of kerosene imports during this period, which is generally stable; since the three major oil companies have exhausted their marketing capabilities in China, this also indicates the largest market size for kerosene consumption in China in modern times. In the 1930s, kerosene imports showed a downward trend. The most important reason for the slowdown in the growth trend of kerosene is the rise in prices. Especially after the Great Depression of the world economy in 1929, China's silver standard currency devalued and the price of kerosene skyrocketed, resulting in a decline in kerosene imports. In China's vast rural areas, as the price advantage of kerosene over vegetable oil is gradually lost, vegetable oil has once again become one of the important lighting oils. In addition, the gradual popularization of electric lighting and the more important utilization value of gasoline than kerosene after the invention of the internal combustion engine have also affected the development of kerosene import trade.
After the founding of the People's Republic of China, the era of imported "foreign oil" ended, but until the early days of reform and opening up, kerosene was still one of the important lighting tools. Although kerosene is mainly domestically produced, the term "foreign oil" is still commonly used in rural areas as a mark of an era.
[This article is a phased result of the National Social Science Fund general project "Research on China's Modern Petroleum Import and Interport Transportation Network (1863-1937)" (19BZS080)]
(Author’s unit: Institute of Economics, Chinese Academy of Social Sciences)
2017 Tianjin Normal University Rankings
Do the candidates in Tianjin know which normal universities are there in Tianjin? What is their ranking? Let’s take a look with the YJBYS editor.
2017 Tianjin Normal University Rankings
Ranking of Tianjin Normal Universities
School name
school type
National ranking
Tianjin Normal University
normal school
98
12
Tianjin Vocational and Technical Normal University
normal school
356
Introduction to Tianjin Normal University
Tianjin Normal University is a key public institution in Tianjin. It was founded on August 1, 1958. Formerly known as Tianjin Normal University, it was established by Tianjin Teachers Training College and Tianjin Workers and Peasants Express Middle School. In 1982, it was renamed Tianjin Normal University. On April 8, 1999, with the decision of the Tianjin Municipal Party Committee and Municipal Government, and the approval of the Ministry of Education, the original Tianjin Normal University, Tianjin Normal College, and Tianjin Institute of Education were merged to form the new Tianjin Normal University. The school implements the school motto of "diligence and rigor, self-cultivation and self-cultivation", establishes a school-running direction that serves basic education, and serves economic and social development. It follows the "student-oriented" school-running philosophy and follows the education standards of "thick foundation, wide caliber, high-quality, multi-purpose talents with one specialty". It strives to cultivate high-quality talents, high-level scientific research results, high-standard discipline construction, and high-efficiency school management, and build a domestic first-class teaching and research comprehensive university with teacher education characteristics.
Tianjin Normal University is a key university in Tianjin and was founded in 1958. There are 25 colleges, 50 research institutions, and 61 undergraduate majors, covering 9 disciplines including literature, science, education, history, law, economics, management, engineering, and art.
The school has always adhered to the principle of open education and has established friendly cooperation and exchange relations with 109 universities in 27 countries and regions. It has established the Confucius Institute at the University of Nairobi and the Confucius Institute at Mansund Chao Phaya Royal Normal University in Kenya and Thailand respectively. It cooperates with Sehan University in South Korea to organize a master's degree education program in educational administration and a master's degree education program in information analysis and decision-making in information science. It also cooperates with Mie National University in Japan to organize an undergraduate education program in Japanese. We have formally signed cooperation agreements with 9 internationally renowned universities to carry out mutual recognition and exchange of credits at undergraduate and master's levels, as well as mutual and joint degree teaching. The school is one of the national higher education institutions qualified to accept foreign students with Chinese government scholarships. It is one of the first batch of pilot schools of the Ministry of Education to recruit Hong Kong students without examination and to accept and recommend Macao students. It is also the overseas study training base of the China Study Abroad Service Center and the settled unit of the Tianjin Alliance Française.
The school has successively won honorary titles such as the National May Day Labor Certificate, the National Advanced Unit for Spiritual Civilization Construction, the National Advanced Grassroots Party Organization, and the National Advanced Internal Auditing Collective.
As of 2013, the school has 28,545 full-time students, including 23,862 undergraduates, 266 doctoral students, 3,003 master's students, 106 students from Hong Kong, Macao and Taiwan; and 2,780 international students of various types.
Party and government functional departments
Party Committee Office, President's Office, Security Office, Security Department, Graduate School of Management, Personnel Office, Student Office, Academic Affairs Department, Armed Forces Department, Logistics Office, Organization Department, Infrastructure Planning Management Department, Laboratory and Equipment Management Department, Teacher Education Department, Scientific Research Department, Academic Affairs Department, Retirement Affairs Department, Propaganda Department, United Front Work Department, Discipline Inspection Office of the Financial Department, Supervision Office, International Exchange Office, and Audit Office.
business service unit
Information Office, Journal Publishing Center, Graduate Employment Guidance Center, Logistics Service Center, Archives, Settlement Center, Reform and Development Research Office, Higher Education Institute, School-run Industrial Management Center, units directly under the Normal University Training Center, library, and continuing education college.
Career Guidance Center
Tianjin Normal University Tianjin Normal University Student Employment Guidance Center was established in 1999. It is an independent institution responsible for student employment guidance and services. It comprehensively coordinates and guides all grassroots colleges in the university to carry out student employment guidance and services. Under the guidance of the Student Affairs Office, the center adheres to the working philosophy of "students first, market oriented, service refinement, and guidance detailed", adheres to the working purpose of "serving students' lifelong career development", and follows the working goal of "guaranteing the number of jobs, improving the quality of employment, and leading students on the right career path", and focusing on the working ideas of "promoting the characteristics of teacher education, consolidating the teacher education market; serving the construction of Binhai New Area, and expanding the non-teacher education market"; and constantly builds the central position of the Bohai Rim education and culture system in the college student talent market.
Department Responsibilities:
Introduce the current employment situation, publicize and implement employment policies, and formulate the working rules of Tianjin Normal University; be responsible for the qualification review of Tianjin Normal University graduates, and promptly report graduate resource status to the Tianjin graduate employment department; collect and release employer demand information and smooth employment channels; carry out graduate employment supply and demand meetings and two-way selection activities, and be responsible for graduate recommendation work; formulate graduate employment plans in accordance with the requirements of the competent department; carry out completion We provide professional education, employment guidance, employment consultation and other work to help graduates establish a correct outlook on career choices; provide personality and vocational aptitude tests, and provide graduates with personal information online, online job hunting, and online inquiries; develop career development research and practical activities for school students; handle the signing procedures of employment agreements, and be responsible for the dispatching and departure procedures of graduates; carry out research and research related to the employment of graduates; complete other tasks assigned by the competent authorities, etc.
Introduction to Tianjin Vocational and Technical Normal University
Tianjin University of Technology and Education, formerly known as Tianjin Engineer College, was founded in February 1979 and was originally affiliated with the former Ministry of Labor. In 2000, it was transformed into a joint venture between the central and local governments, with Tianjin City as the main management. In March 2010, the school was renamed Tianjin Vocational and Technical Normal University. Tianjin Vocational and Technical Normal University has always adhered to the school-running philosophy of "using hands and brains, all-round development", taking patriotism, dedication, unity, and innovation as its school motto, and persisting in its unshakable school-running positioning of cultivating high-quality vocational teachers for the country. The school is the first ordinary higher education institution established in China with the main task of cultivating vocational education teachers. It is known as the "cradle of vocational teachers". In March 2012, the Ministry of Education and the Tianjin Municipal People's Government signed an agreement to jointly build Tianjin Vocational and Technical Normal University. It is the only university among local universities in Tianjin that is jointly built by the ministry and the city.
Tianjin Vocational and Technical Normal University is the earliest general higher education institution established in China with the main task of cultivating vocational education teachers. It is a general higher education university that focuses on engineering and education, as well as science, management, economics, and literature. It is one of the first higher vocational and technical normal universities established in China. It is well-known at home and abroad for cultivating high and secondary vocational teachers and applied senior professionals.
Tianjin Vocational and Technical Normal University was founded in 1979 and was affiliated to the former Ministry of Labor. In 2000, it was converted to a joint venture between the central and local governments, with Tianjin City as the main management. In March 2010, it was renamed Tianjin Vocational and Technical Normal University. In March 2012, the Ministry of Education and the Tianjin Municipal People's Government signed an agreement to cooperate in the construction of Tianjin Vocational and Technical Normal University.
The school has been designated as 12 national-level and municipal-level education and training bases by the Ministry of Education, the Ministry of Labor and Social Security, the Ministry of Commerce, and Tianjin Municipality. Three of them (the National Key Vocational Education Teacher Training Base, the National Higher Vocational Education Teacher Training Base, and the National Vocational Training Teacher Training Base) have become the leading units in the construction of national vocational teacher training bases.
The school covers an area of more than 1 million square meters, with a construction area of 660,000 square meters. The school has more than 18,000 full-time students of various types. The school has a strong and distinctive teaching staff. Professors and associate professors account for 53% of the total number of teachers. 78% of the practical training teachers have the professional qualifications of technicians and senior technicians. In secondary colleges such as the School of Mechanical Engineering, the School of Automation and Electrical Engineering, the School of Electronic Engineering, and the School of Automobile and Transportation, the proportion of "integrated dual-qualified" teachers has reached 56%. The school currently has 17 national-level experimental demonstration center construction units (engineering training centers) and training centers, 160 various training laboratories, and 5 innovative practice bases. It has advanced experimental and practical training equipment worth 319 million yuan, and the per-student equipment value ranks among the top universities in the country.
The school currently has 7 disciplines: engineering, management, economics, education, science, literature, and art. It has 1 project postdoctoral workstation, 7 first-level master's degree programs, 32 second-level master's degree programs, 1 professional degree authorization site, 43 undergraduate majors, 4 national-level specialty majors (automation, mechanical technology, communication engineering, electromechanical technology education), 11 Tianjin brand majors, and 4 Tianjin strategic emerging industry majors. Cooperated with Tianjin First Machine Tool Factory to build a postdoctoral workstation; it has 4 provincial and ministerial key disciplines (education, mechanical engineering, transportation engineering, control science and engineering), 5 school-level key disciplines, and 1 school-level key development discipline; it has 2 provincial and ministerial key laboratories (high-speed cutting and precision machining laboratory, information sensing and intelligent control laboratory), 1 provincial and ministerial key technology engineering center (Fieldbus Control Technology Engineering Center), and 1 provincial and ministerial key humanities and social sciences research base.
TJC: Transition from prison to community
"Transition from Jail to Community" is often abbreviated as TJC for quick writing and use.
Commonly found in social fields, and related.
Chinese meaning: "Transition from prison to community".
Transition from Jail to Community Specific definition English abbreviation: TJC Full English name: Transition from Jail to Community English pronunciation: American English Pronunciation: British English Pronunciation: Chinese meaning: Transition from prison to community Chinese Pinyin: cóng jiān yù guò dù dào shè qū Common fields: Social related:
Notice:
The English abbreviation TJC means more than just "Transition from Jail to Community".
What does the abbreviation "TJC" mean?
The English abbreviations of TJC collected by this site include:
[Sports] Field: Trick Jump Competition abbreviated as "TJC". Chinese means: Long jump competition [Business] Field: The Johnston Company abbreviated as "TJC". Chinese means: Johnston Company The Jennifer Collection abbreviated as "TJC". Chinese means: Jennifer Collection The Joseph Company abbreviated as "TJC". Chinese means: Joseph Company Thomas James Culinary abbreviated as "TJC". Chinese means: Thomas James Cooking Tata Johnson Controls Automotive, Limited, abbreviated as "TJC". Chinese meaning: Tata Johnson Controls Limited [Academic Science] Field: Tyler Junior College, abbreviated as "TJC". Chinese meaning: Tyler Junior College Temasek Junior College, abbreviated as "TJC". Chinese meaning: Temasek Junior College [Institution] Field: Tahirih Justice Center, abbreviated as "TJC". Chinese meaning: Tahirih Justice Center TraJectory Chart The abbreviation is "TJC". The Chinese meaning is: Track map Tennessee Justice Center. The abbreviation is "TJC". The Chinese meaning is: Tennessee Justice Center [Social] Field: True Jesus Church. The abbreviation is "TJC". The Chinese meaning is: The Jewish Channel. The abbreviation is "TJC". The Chinese meaning is: The Jewish Channel The Joint Commission (formerly JCAHO) Abbreviated as "TJC". Chinese meaning: Joint Commission (former JCAHO) Twine Jokers Club abbreviated as "TJC". Chinese meaning: Twine Jokers Club [Comprehensive] Field: The Joint Commission abbreviated as "TJC". Chinese meaning: Joint Commission Tyler Junior abbreviated as "TJC". Chinese meaning: Tyler Junior Tender Joint Count abbreviated as "TJC". Chinese meaning: Tender Joint Count
statement:
The English abbreviations on this site are collected and organized by individuals, and non-commercial copying, use, forwarding and sharing are allowed.
However, collection and bulk theft are strictly prohibited.
If there is any error, inappropriateness or infringement in the TJC abbreviation information, please contact us for processing.
Under the sharp price reduction, lithium carbonate may take off the expensive hat of "white oil".
At present, lithium carbonate has started a "200,000 yuan defense battle." According to Wind data, the average price of domestic battery-grade lithium carbonate has dropped to 215,000 yuan/ton on April 6, down more than 60% from the high of 567,500 yuan/ton in November 2022.
As for the "bottom line" for lithium carbonate price reduction, there is still controversy in the market. Some people believe that the price of lithium carbonate is expected to fall to 100,000 yuan/ton and below, but some companies believe that 250,000 yuan/ton is the break-even line. According to The Paper, in the face of "continuously falling" lithium carbonate prices, half of the four major mica lithium extraction companies in Yichun, the "Lithium Capital of Asia", have chosen to suspend production.
Why do lithium carbonate prices continue to fall? What kind of disagreement does the market have on the bottom line of lithium carbonate price?
One of the reasons for price cuts: downstream demand is lower than expected
This is not the first time that the price of lithium carbonate has plummeted. According to Wind data, in July 2020, the price of domestic battery-grade lithium carbonate fell to a low of 40,000 yuan/ton. The sharp drop in the price of lithium carbonate back then had a similar reason to today's price drop of lithium carbonate - sluggish demand.
At the 7th Annual Lithium Battery & Electric Vehicle Industry Conference that reporters attended in March, Cui Dongshu, secretary-general of the Passenger Car Association, once said: "Why did the price of lithium carbonate fall in 2020? Because my country's new energy vehicle sales in 2017 and 2018 Volume grew rapidly and stagnated in 2019 and the first half of 2020. However, a large number of companies made high investments in 2018 and 2019, and there was an explosive oversupply and sluggish demand in 2020. "
According to data from the China Association of Automobile Manufacturers, sales of new energy vehicles in my country increased by 53.3% and 61.7% year-on-year respectively in 2017 and 2018, showing strong growth. In 2019 and 2020, my country's new energy vehicle sales fell by 4% and increased by 10.9% year-on-year respectively, almost stagnating.
If the sales of new energy vehicles are the support for the price of lithium carbonate, then the slowdown in the sales growth of new energy vehicles this year has "disrupted" the price of lithium carbonate. For the whole of 2022, my country's new energy vehicle sales were 6.887 million units, a year-on-year increase of 93.4%. On April 4, according to estimates from the Passenger Car Association, new energy vehicle manufacturers sold 1.48 million vehicles in the first quarter of this year, a year-on-year increase of only 25%.
Lin Shi, Secretary General of Intelligent Connected Vehicles and Automotive Analyst of the China-Europe Association, said in an interview with reporters: "Many lithium mining companies have miscalculated the growth rate of new energy vehicles. The cancellation of the new energy vehicle 'state subsidy' directly caused the new energy vehicle market this year not to continue last year's sales growth, with a growth rate of only 25% in the first quarter. Many lithium mining companies plan lithium ore production based on a 'double' growth rate, which leads to a mismatch between supply and demand."
It can be seen that the sales growth of new energy vehicles in my country has slowed down significantly since the beginning of this year, and the growth rate of downstream demand is lower than expected, which will inevitably lower the market's price expectations for lithium carbonate. This is one of the reasons for the decline in lithium carbonate prices.
The second reason for price reduction: The entire industry chain is facing overcapacity
"Supply and demand determine commodity prices." In addition to demand, the increased supply of lithium carbonate also "added fuel to the price decline."
Chen Jia, a researcher at the International Monetary Institute of Renmin University of China and an independent international strategy researcher, said in an interview with reporters: "The price of lithium carbonate has plummeted from the early peak of 600,000 yuan/ton to the current range of 200,000 yuan. The large drop and wide impact undoubtedly exceed the lithium carbonate industry's own expectations. Otherwise, in the past two years, many companies would have entered the upstream lithium resource industry chain, either crossing borders or increasing production."
Financial commentator Zhang Xuefeng also said in an interview with reporters: "The decline in lithium carbonate prices is mainly due to the increase in supply. In recent years, domestic lithium carbonate production capacity has continued to expand, coupled with the increase in foreign imports, resulting in excess supply."
According to Huafu Securities Research Report, with the release of production capacity in South American salt lakes and Australian spodumene, global lithium supply will be 760,000 tons of lithium carbonate equivalent in 2022, will reach 1.047 million tons in 2023, an increase of 37.76%, and will reach 1.44 million tons in 2024, an increase of 37.53% year-on-year.
If the calculation is accurate, the increase in lithium resource supply this year may exceed the increase in new energy vehicle sales (only about 25% in the first quarter). As the penetration rate of new energy vehicles further increases, the release of lithium carbonate production capacity in 2024 may significantly exceed the sales growth of new energy vehicles. Simply put, "supply may rise faster than demand in the next few years," which casts a shadow over the price of lithium carbonate.
"I think the main reason (for the price reduction of lithium carbonate) is the disorderly expansion of the industry. Last year or the year before last, the price of lithium ore skyrocketed. Everyone was jealous when they saw that lithium mining companies could increase their net profits by hundreds of percent at every turn, and they all entered this industry. In addition, the threshold for the lithium ore mining industry is not high. , including vehicle companies and battery manufacturers, have invested in lithium mines, which has led to a large increase in lithium mining capacity this year and low demand, which has led to lithium mine prices having to come down, otherwise mining companies will not be able to ship and will increase inventory," Lin Shi told reporters.
In fact, the imbalance between supply and demand of lithium carbonate is just a microcosm of the overcapacity faced by the entire lithium battery industry. According to incomplete statistics from GGII, 268 new investment and expansion projects in China's lithium battery industry chain will be signed in 2022, including lithium batteries and materials. Based on the statistics of 247 projects with announced investment amounts, the total investment amount in China's lithium battery industry in 2022 will exceed 1.4 trillion yuan.
"If we broaden our horizons and jump out of the shackles of lithium carbonate prices and comprehensively examine the data of the entire lithium battery material industry chain, we will find that not only lithium carbonate, but other lithium battery materials including lithium phosphate have fallen even more sharply; comprehensive overcapacity of liquid battery basic materials such as cathode materials, anode materials, electrolytes, and separators has already begun to emerge in 2022, and the overcapacity at the entire industry chain level has been intensifying for a long time." Chen Jia said.
According to Wind data, the average price of domestic lithium iron phosphate electrolyte fell to 36,500 yuan/ton on April 6, and has continued to decline for the past year and a half. It has dropped 67.64% from the price high of 112,800 yuan/ton on October 13, 2021. The price of cathode materials also continues to decline. On April 6, the price of domestic lithium iron phosphate cathode materials fell to 88,500 yuan/ton, which was exactly "halved" from the price of 177,000 yuan/ton on November 8, 2022.
Overall, the entire lithium battery industry chain is facing a crisis of overcapacity. Zhang Jiujun, dean of the School of Materials Science and Engineering at Fuzhou University, said that it is predicted that the battery demand for new energy vehicles will exceed 1,200GWh by 2025. Although the prediction is not necessarily accurate, the current power battery production capacity planning of various manufacturers has exceeded 4,000GWh, which is much more.
According to incomplete statistics, as of the end of December 2022, the production capacity plans announced by battery factories, vehicle manufacturers and other cross-border enterprises have exceeded 4,800GWh, and most of the production capacity is planned to be launched in 2025 or before. In other words, if only the increase of new production capacity is considered and the elimination of old production capacity is not considered, the lithium battery industry may have serious overcapacity.
But Jia Hongtao, chief engineer of the power battery system at the Geely Automobile Group Research Institute, said: "With the development of the industry, all of our batteries are actually in the process of upgrading and iterating. This is not a simple upgrade. The past factories and production lines have to be eliminated and upgraded."
An industry insider told reporters: "Our entire equipment technology and product technology have been updated too fast. Now the technology from 5 years ago is already very backward." Therefore, if the elimination of old production capacity is included, the overcapacity in the lithium battery industry may not be too serious.
Mo Ke, chief analyst of True Lithium Research, also said in an interview with reporters that companies generally build production capacity moderately ahead of schedule, so there will be a bit of excess. However, the expansion of enterprise production is generally divided into many phases, of which the first phase will be realized. The construction of subsequent phases will depend on the utilization rate of the first phase to decide whether to maintain the original plan or adjust it, so overcapacity is not expected to be too much.
Despite this, most experts, scholars and industry insiders interviewed by reporters believe that overcapacity in the lithium battery industry will appear from 2023 to 2025. Regardless of whether this overcapacity is serious or not, it will have a certain negative impact on the price of lithium carbonate.
The third reason for price reduction: Car price war forces car companies to reduce costs
"From the perspective of direct causes, the prisoner's dilemma effect caused by a large number of companies in the upper reaches of the industry chain rushing to sprint for production capacity in the early stage, and the backlash effect caused by the price war in the automobile retail market triggered by Tesla's large price cuts in the lower reaches of the industry chain, are the 'culprits' of the rapid increase in lithium carbonate prices." Chen Jia said.
Specifically, the main factors that force the price reduction of upstream lithium mines are the price war between downstream car companies and CATL's "lithium mine rebate" plan. In February this year, when the price of lithium carbonate was still over 400,000 yuan/ton, CATL was exposed to have launched a "lithium rebate" plan. The core terms are: in the next three years, the price of lithium carbonate for some power batteries will be settled at 200,000 yuan/ton. At the same time, car companies that sign this cooperation need to commit to giving about 80% of their battery purchases to CATL.
At that time, Chen Jia said in an interview with reporters: "On the surface, the lithium ore rebate plan signed by battery companies and car companies was due to the external factor of high and volatile lithium carbonate prices. In fact, it was caused by the price war in the downstream new energy vehicle market that spread to the upstream. In order to compete with Tesla and other brands in production under the price war, many car companies must further reduce the cost of a single vehicle."
In January this year, Tesla’s Model 3 and Model Y saw price cuts of up to 48,000 yuan, marking the first shot in this year’s car price war. In March, Hubei teamed up with a number of car companies to launch a car purchase subsidy of up to 90,000 yuan, pushing the price war in the auto industry to a climax. According to incomplete statistics, more than 40 car brands have joined this price war in different forms.
On March 30, Volvo officially announced that its S90, XC90, S60, XC60 and XC40 (fuel version) and other models will have car purchase subsidies, with a total amount expected to be as high as 200 million yuan. The activity period will be from April 1 to April 30, 2023.
In April this year, Geely officially launched a limited-time purchase event for exclusive models, providing a comprehensive subsidy of up to 45,000 yuan for more than 10 models including the Xingyue LHi·P. The event lasted from April 1 to April 30.
To this day, the price war in the automobile industry has not ended, and the need to further lower automobile production costs will not stop. In turn, the price reduction of upstream lithium resources will also provide "ammunition" for the price war in the automobile industry. Since there is a transmission time of several months from the price reduction of lithium resources to the reduction of manufacturing costs of automobile companies, if the automobile companies expect that the price of lithium resources will further decrease, they may increase their participation in the price war and form a "price reduction cycle" for lithium carbonate prices.
The fourth reason for price reduction: sodium batteries are on the way to "grabbing jobs"
From a deeper perspective, the plummeting price of lithium carbonate is also affected by the "substitution effect" triggered by technological advancements in the industrial chain. Sodium battery and semi-solid/solid-state battery technologies are now booming.
"Take sodium-ion batteries as an example. As early as when the price of lithium carbonate soared to 600,000 yuan/ton, the country launched a sodium battery replacement strategy from the perspective of resource security. All major domestic new energy battery manufacturers have basically made sufficient technical reserves for it. Preliminary estimates show that even if the price of sodium batteries drops to the 100,000 yuan/ton range, the cost of mature sodium batteries will be 30% to 40% lower than that of lithium batteries on average." Chen Jia said.
It is understood that sodium batteries and lithium batteries are both "rocking chair batteries". They are different from lithium batteries in the selection of positive electrode materials, negative electrode materials, electrolytes, etc. For example, the common form of sodium resources is salt, which is much cheaper than the "white petroleum" lithium carbonate that relies heavily on imports.
Compared with lithium batteries, the outstanding advantage of sodium batteries is low cost, but the disadvantage is insufficient energy density, which makes it difficult to effectively replace lithium batteries in the field of new energy vehicles. According to Caitong Securities research report, the energy density of sodium-ion batteries is generally between 100Wh/kg-150Wh/kg, and lithium-ion batteries can reach 150Wh/kg-250Wh/kg.
Qi Haishen, president of Beijing Teyi Sunshine New Energy Technology Co., Ltd., said in an interview with reporters that sodium batteries can replace lithium batteries in low-speed electric vehicles, communication base stations, electric bicycles, electric energy storage, solar street lights and other fields that have relatively low energy density requirements.
According to previous disclosures from companies such as CATL and Zhongke Haina, 2023 will officially become the first year of mass production of sodium batteries. Qidian Research CEO Li Zhenqiang believes that the development of sodium batteries is a national strategy and will help solve the problem of lithium resources being controlled by others. The cost advantage of sodium batteries will be reflected in 2-3 years. He said: "Sodium batteries are not a supplement to the lithium battery industry, but a substitute. They will benchmark lithium iron phosphate and lithium manganate batteries upwards and replace lead-acid batteries downwards. If the old forces of lithium batteries and lead-acid batteries do not go all out, they will be cut off by the new forces of sodium electricity."
Taken together, the emergence of sodium batteries will seize the market share of lithium batteries in many fields such as energy storage, thus affecting the demand and price of lithium carbonate. In the more distant future, the development of technical routes such as hydrogen fuel cells may also touch the "dominance" of lithium batteries.
How far will it fall? Disagreement over price "bottom line"
If the price drop of lithium carbonate is not caused by an isolated factor, but the result of the combined influence of multiple factors. So where is the bottom line of lithium carbonate price, and to what price will it drop?
In March this year, Li Xiang, founder, chairman and CEO of Li Auto, predicted that the price of lithium carbonate would be stable at 200,000-300,000 yuan per ton in the long term. NIO founder, chairman and CEO Li Bin predicts that the price of lithium carbonate is expected to drop to 200,000 yuan/ton in the fourth quarter. These two heads of new car-making forces are "conservatives" in predicting lithium carbonate prices.
There are even more "radical" ones. During the two sessions in early March, Li Liangbin, chairman of Ganfeng Lithium Industry, told the media: "The price of lithium salt was 600,000 yuan/ton yesterday, and it may be 100,000 yuan/ton tomorrow." At the recently held China Electric Vehicle 100 Forum (2023), Wang Yu, chairman of Funeng Technology, said that it is not impossible for the price of lithium carbonate to drop below 100,000 yuan per ton in the future.
So, where is the "breakeven line" for lithium mining companies? Lin Shi told reporters: "Based on the current mining costs, if the price of lithium carbonate is 100,000 yuan/ton, most companies will still make money. If it is less than 100,000 yuan/ton, they will lose money."
Zhang Xuefeng said: "The bottom line of lithium carbonate price is difficult to determine. Affected by various factors, the overall cost of the industry is about 150,000 yuan/ton, but the specific price must also consider market supply and demand and domestic and foreign policy environments."
However, the related costs of lithium carbonate may increase in the future, further raising the "break-even line". According to calculations by Huafu Securities, due to high energy prices, the increase in resource-end production capacity has led to an increase in related auxiliary materials and other expenses. It is assumed that the cost of salt lake lithium in 2024 will increase by 5% compared with 2022, the cost of lithium extraction from spodumene will increase by 10%, and the cost of lithium extraction from lepidolite will increase by 15%. Then when the price of lithium carbonate (tax included) drops to 240,000 yuan/ton, the Guoxuan Hi-Tech lepidolite project will stop production due to high production costs. When the price of lithium carbonate (tax included) drops to 100,000 yuan/ton, mica lithium extraction companies will cease production except for Yongxing Materials and Jiangxi Tungsten Industry.
According to GGII's forecast, based on the current price decline of lithium carbonate, the original market expected price to fall to 200,000 yuan/ton by the end of the year may arrive in the second quarter of this year.
However, Chen Jia believes that the price reduction of lithium carbonate is actually a "double-edged sword." Although it will reduce the costs of battery manufacturers and car companies, if this price collapse cannot be stopped in time, it will have an impact on the upgrading of China's new energy industry chain.
"Let's take sodium-ion batteries, a relatively mature technology alternative, as an example. Assuming that there is no major breakthrough in the production technology of sodium-ion batteries in the short term, once the price of lithium carbonate drops to the break-even point of 100,000 yuan/ton, the overall price of lithium batteries will be basically the same as that of sodium batteries. Some are extremely sensitive to market prices. Battery manufacturers will be faced with the dilemma of whether to continue to invest in sodium batteries. Our competitor Japan is continuing to develop similar technical solutions. Once China's new energy industry chain stops its rapid growth, it is likely to be overtaken by it in this field from 2030 to 2035," Chen Jia said.
Although China currently leads the world in lithium battery technology, Japanese and Korean companies have already made in-depth efforts in the field of "solid-state batteries" with higher energy density and representing the future development direction of the lithium battery industry. According to a research report from Huaan Securities, Japan is currently in a leading position in technology globally due to its earlier planning and layout of solid-state battery industrialization. South Korea's three major battery companies with leading technologies have also chosen to jointly develop solid-state batteries. Major European and American car companies are trying to gain technological reserves by investing in start-up companies such as Solid Power, Solid Energy Systems, Ionic Materials, and Quantum Scape, and seek to make a comeback in the field of solid-state batteries.
In order to maintain my country's dominant position in the new energy field, it is also necessary for the price fluctuations of the entire new energy vehicle industry chain to be more stable. Lin Shi said: "If the price of lithium ore drops particularly sharply, many lithium mining companies will stop working, which will lead to insufficient supply of lithium ore. Just like pork, the price will skyrocket and then plummet. What the new energy industry is most afraid of is the sudden rise and fall of raw material prices. In this case, what new energy vehicle companies want to see is the stability of lithium ore prices, not the cheaper the better."
"Taking comprehensive consideration of the current domestic production capacity balance and upstream and downstream market demand, a red line will be formed when the price of lithium carbonate enters the range of 100,000 yuan per ton. Once the red line is exceeded, it will cause a series of supply chain, industrial chain disorders and market chaos. At this moment, it is necessary for the regulatory authorities and the industrial chain to work together to jointly maintain the sustainable development of all ends of the new energy industry chain." Chen Jia said.
Recently, Mr. Jin from Shenyang reported to a reporter from Securities Daily that last month, a credit card co-branded by a bank and a large supermarket he held was deducted 500 yuan by the relevant bank without notifying him. This money was the supermarket card credit he returned by redeeming points. After inquiry, the bank stated that his credit card was frozen due to suspected business risks and the credit card credit had been deducted. Although after a risk investigation, Mr. Jin’s credit card returned to normal and the credit card fees were returned normally, Mr. Jin still felt puzzled, “Why is a credit card that has been used well suddenly suspected of business risks?”
According to an investigation by a reporter from Securities Daily, a gray channel for cashing out points from the above-mentioned supermarket co-branded credit cards has gradually become clear. Its operation is more cumbersome than other cash-out methods: first, cardholders use POS machines to swipe their cards for effective consumption to obtain points. Generally, the handling fee applied for in advance is relatively small. Use a POS machine that has high points but can earn points to cash out the card for the first time to obtain enough points; after having enough points, use the card to make purchases in the above supermarkets. Then the cardholder applies to the bank's credit card center to redeem the points and return the card payment. Finally, the cardholder sells the goods to cash out.
An intermediary engaged in cashing out credit cards told reporters that this method of cashing out is relatively complicated and is not the most efficient way for intermediaries to make money. However, it is precisely because cashing out is difficult and involves a third-party institution - the above-mentioned supermarket - that it is not easily detected by banks.
Secret cash-out chain
Mr. Jin told a reporter from Securities Daily that this supermarket co-branded credit card is his most used credit card. Its special feature is that not only can you enjoy double points for shopping in supermarkets, but you can also use the credit card points accumulated from past purchases to directly convert them into repayment funds when repaying.
The slogan of the credit card center of the relevant card issuer also states, "Points can be used to redeem your in-store consumption in supermarkets. Every 1 yuan of RMB consumption in the store will earn 2 points, and every 1 yuan of RMB consumption outside the store will earn 1 point. If any fraud or fraud is involved in the accumulation or redemption of points, all accumulated points and redeemed gifts, card credits or flight miles may be canceled by the bank, and the bank also reserves the right to pursue legal liability against the cardholder."
The specific redemption rules are that for each supermarket credit card main card in a single natural year, the cash redemption ratio is 0.25% for 3,000 to 6,000 points, 0.5% for 6,000 to 10,000 points, 1% for 10,000 points and above, and the total number of points redeemed is capped at 200,000 points. In addition, the bank also stipulates that the first 2,999 points will not be redeemed.
Calculated based on a card with 200,000 points, the first 2,999 points will not be counted. The redemption amount within 6,000 points is 3,001 multiplied by 0.25%, which is 7.5 yuan. The remaining 4,000 points within 10,000 points can be redeemed for an amount of 20 yuan. The last 190,000 points can be redeemed for an amount of 1,900 yuan. This means that a credit card can eventually cash out nearly 2,000 yuan in cash.
The telephone customer service staff of the relevant bank told reporters that the application qualifications for the card are not high. Interested customers can apply directly through online banking, and the card can normally be approved within a week.
"After you have a credit card, you can swipe your card to cash out at some specific POS machines. These POS machines are generally POS machines with a points function that have been applied for by the intermediary in advance. Although the handling fees charged by the bank are higher, the income can cover the cost. After all, it is a business without capital," the credit card intermediary said.
The reporter also found that near some department stores or large stores, people who swipe their cards often ask if they need to pay on their behalf, and then get the cash from the real buyer to achieve the purpose of earning points. However, in this process, it is usually necessary to give the buyer some discounts.
When there are enough points in the credit card, the cardholder can go to the supermarket for shopping. Within 60 days after the purchase, submit a cash redemption application to the credit card center of the card issuer. After that, the money will be returned to the credit card in proportion. Finally, the cardholder can directly sell the items to obtain cash.
At present, my country's Consumer Rights Protection Law stipulates 60 days for hassle-free exchange, but according to the current supermarket return and exchange standards, the time is generally extended to 90 days. In other words, if the cardholder encounters problems in cashing out, he can also apply for a return or exchange without causing major losses.
It should be noted that under normal circumstances, the flow of funds between shopping malls and banks follows the principle of "where money goes out, money comes in". Even if the cardholder applies for a return, the refund will be returned to the payment account, and cash returns are not supported. Because there have been many cases of cashing out using this loophole before.
Hard for banks to detect
According to a reporter from Securities Daily, Mr. Jin’s situation is not an isolated case. In July and August, many cardholders applied for cash redemptions from their credit cards but were debited by the bank, and the bank also temporarily froze the credit card. Some cardholders have jointly lodged a complaint with the bank, but have yet to receive a positive reply from the bank.
A relevant person who is engaged in credit card swiping intermediary said that this method of cashing out is very hidden. On the one hand, for bank credit card data, cardholders are making normal purchases and repaying the money on time, and there is no problem; on the other hand, the final sale of the goods by the cardholder is already a personal behavior after the transaction is completed, and 200,000 points is not easy for ordinary people, so only specialized credit card payment intermediaries can do this transaction.
The so-called illegal cashing out refers to changing the purpose of funds through false transactions and using the withdrawn funds for illegal purposes or other prohibited purposes. Take advantage of the subtle differences in prices between the same product or nearly identical products in different markets.
People from Everbright Credit Card Center believe that if cardholders use POS machines to cash out and obtain points, it can be defined as illegal cashing out because no real transaction has occurred. But it is not easy for banks to find abnormalities in credit cards, especially when all data is normal.
"Perhaps the bank discovered that cashbacks in a certain area are very dense and the amount is large, and then they realized the problem. However, the source of everything still lies in the point acquisition of POS machines. There are many POS machines on behalf of them. In order to charge handling fees, some banks are not very strict in auditing," said the above-mentioned credit card payment intermediary.
POS machine chaos
According to the National Development and Reform Commission’s notice on optimizing and adjusting bank card swiping fees, bank card swiping transactions are divided into four major categories: dining and entertainment, general, people’s livelihood and public welfare. The handling fees transferred from merchants are divided by multiple links, including card issuers, acquirers and UnionPay. Most of them are in a ratio of 7:2:1, and some are in a ratio of 8:1:1. This also means that the card issuer gets the majority share.
As a result of the above-mentioned sharing, some card issuers have relaxed the review process in order to seize the market. According to data released by the People's Bank of China on the main entities operating the payment system in the second quarter of 2014, the number of bank cards issued in my country reached 4.540 billion, the number of domestic special merchants reached 9.9303 million, and the number of POS machines reached 13.5813 million.
A person involved in the POS machine industry said that the number of installations is still the main factor in business assessment. The more installations, the greater the commission. As for the risks, they cannot be seen in a short time.
According to a reporter from Securities Daily, the current risk control system of banks can detect abnormal data when a single card is repeatedly swiped at one or several POS machines. Therefore, for intermediaries, one POS machine can no longer meet the demand. After a credit card goes through the complicated cash-out process of several POS machines, it is often difficult for banks to monitor the risks, which also indirectly causes the high incidence of bad debts.
The interim reports of listed banks also showed that bad debts in the credit card business entered a period of high incidence in the first half of this year. Take a bank well-known for its retail business as an example. In the first half of this year, the bank's credit card non-performing loan balance increased by nearly 300 million yuan, an increase of 18.1% from the end of last year, while the credit card loan balance increased by 16.88% during the same period.
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