Research On Motivation And Performance Impact Of HX Auto Parts Company’s Cross-border M&A

With the continuous development of science and technology,culture and economy in China and the strong support of national policies,as well as people’s continuous pursuit of a better life,cars have gradually become a means of transportation in people’s life.China’s automobile industry has been developing rapidly in recent years.The auto parts industry develops with the development of the auto industry.Compared with Europe and the United States,China’s manufacturing industry started late and has not yet mastered the core technology of parts industry.However,foreign parts enterprises have advanced technology and high market share in the international market,which poses a huge threat to China’s auto parts industry.For Chinese auto parts companies,cross-border mergers and acquisitions become the best way to overcome the long R&D cycle and high technical barriers while improving independent research and development capabilities,forming a global industrial layout and acquiring international markets and high-quality customers.This paper takes three consecutive cross-border M&A cases of HX Auto Parts Company as the research object and makes a detailed analysis of the main motivations of HX’s cross-border M&A and its financial performance before and after cross-border M&A through the method of motivation theory and industry background.Suggestions are put forward on how to improve the performance of cross-border mergers and acquisitions in the auto parts industry,which plays a reference role in the implementation of cross-border mergers and acquisitions strategies in the auto parts industry.This paper adopts the literature research method to sort out the research results and conclusions of domestic and foreign scholars on the motivation and performance of cross-border M&A in recent years,and introduces the theoretical basis of the motivation of M&A and the methods of financial performance evaluation,which provides a theoretical basis and research ideas for the case analysis in the following paper.By expatiating the development status of the auto parts industry and the transnational merger and acquisition status of parts companies,the motivation of transnational merger and acquisition in the auto parts industry is summarized.In the context of industry development,the process of HX Company’s three consecutive cross-border mergers and acquisitions in four years is sorted out and the motivation is analyzed.In this paper,event study method and principal component analysis method are used to analyze and evaluate the market response and comprehensive financial performance level of cross-border M&A,and non-financial index evaluation method is used to analyze the R&D capability of HX Company after cross-border M&A.Through a series of research and analysis,the article draws the following conclusions: First,the enterprise’s M&A activities have basically realized the main motivation of its strategic transformation and upgrading.This cross-border M&A quickly gained market share and crossed technical barriers,but its R&D and innovation ability did not improve.Second,high-quality underlying assets in cross-border M&A activities can enhance the shareholder wealth effect of HX in the short term.Third,the score of the comprehensive financial performance index shows that the occurrence of cross-border mergers and acquisitions can resist the decline of financial performance in the downturn of the domestic auto parts market to a certain extent,but when the subsequent integration is not good enough,the level of the financial performance of the cross-border merger and acquisition will be weakened.