In the investment history of Evergrande Group, it can be said that Ocean Flower Island is one of the most obvious pearls. Ocean Flower Island is a very grand plan, integrating residence, tourism, vacation, entertainment and leisure, which can be called a complex of artificial islands. Evergrande has invested a huge amount of more than 160 billion yuan, but due to its relatively remote location and the unsatisfactory business situation of Evergrande in recent years, the overall sales of Ocean Flower Island are not as expected, and it is impossible to quickly return the funds. In addition to Ocean Flower Island, Evergrande has also purchased a large number of land across the country to plan and build cultural tourism city projects, such as Guiyang, Xi'an, Yantai, Wuhan and other places. The planned investment of these cultural tourism cities is hundreds of billions of yuan, however, due to the long construction period, most of these projects are in a state of unfinished, which further tightens Evergrande's capital chain.
As one of the key development directions of Evergrande Group, Evergrande Automobile was once regarded as a pillar industry in the future. However, since its inception in 2017, Evergrande Auto has been in the red. From 2018 to 2022, Evergrande Automobile's losses will be 14300 million yuan, 44300 million yuan, 73900 million yuan, 563400 million yuan, 276600 million yuan, with a cumulative loss of more than 97 billion yuan. Compared with the number of losses, Evergrande Automobile's sales are relatively bleak, with cumulative sales of less than 1,000 units as of the first half of 2023. In order to achieve the ambitious goals set by Xu Jiayin, Evergrande Automobile not only invested a lot of money, material resources and manpower, but also purchased land in Nansha, Guangzhou, Tianjin and Zhengzhou, Henan Province to build automobile cities. However, these huge investment projects have not brought the expected returns to Evergrande, but have become one of the reasons why Evergrande is the most burdened.
The reason why Evergrande Group established a song and dance troupe is regarded as a maverick is that private enterprises rarely set up art groups of this size. Evergrande Song and Dance Troupe was founded in 1999, and in 2011, the Evergrande National Song and Dance Troupe was established*** At the peak of 2019, the number of insured people in the Evergrande Song and Dance Troupe reached 78, and it is rumored to have reached the scale of 200 people. Evergrande Song and Dance Troupe covers many artistic fields such as folk dance, folk songs, dance drama creation and performance, and has become a large-scale professional art group. However, according to public information, the Evergrande Song and Dance Troupe does not have much external business, and most of its activities are carried out within Evergrande. Although as a wealthy enterprise, Evergrande has established a song and dance troupe and held some performances, but such a move also suggests that Evergrande has moved towards enjoyment-oriented development, which may ignore the hardships and sense of crisis of entrepreneurship, and this transformation may cause the company to deviate from the original business track.
The three projects that Evergrande regrets the most are all derived from its ambitious strategic planning. However, many problems have been exposed in the implementation of these projects. Ocean Flower Island is geographically remote and its sales are poor, resulting in Evergrande's inability to quickly return fundsThe construction period of the cultural tourism city project is long, which makes Evergrande fall into financial difficulties;Evergrande Automobile has always lost money and its sales have been sluggish, which has become a burden for the company;The establishment of the Evergrande Song and Dance Troupe has raised questions about the company's development route. The failure of these projects has exacerbated Evergrande's liquidity crunch and debt problems to a certain extent, which is undoubtedly a heavy blow to Evergrande.