Le Kai recombines into the space science and technology group hard film era complex

The revolution caused by digital cameras brought film cameras and photo film to antique shops. The company's popularity in the era of film cameras has ceased, including the China Lucky Film Group, which is owned by the SASAC.

Last week, Lekai Group official website announced that the group as a whole merged into another state-owned enterprise, China Aerospace Science and Technology Corporation, and became a wholly-owned subsidiary. The news of the reorganization of Lucky Group was settled.

In the 90s of last century, Kodak, Fujifilm, and Lucky Three were the symbols of the Big Three, and yellow, green, and red (outer package colors) became their symbol. Lucky is also the only company in the industry that can compete with world brands on the same platform. This company, which has a history of more than half a century, once was a well-known domestic product, also known as the pride of a national brand.

With the passage of time, with the popularity of digital cameras, film, film cameras, and even the printing industry, are irreversible to go out of hand, Lekai so Kodak, Fujitsu is also struggling in the transition, explore.

Lekai made film once brilliant

“Lokkai is a good value for money. At that time, it was the best choice for our group of people who studied photography.” After the photographer Mr. Zhao was 70, he said that he was full of praise. “I used a few hundred rolls of Lucky, There is not a roll of quality problems."

It is not just photography professionals who still have a lot of memories of Lucky. It also includes many ordinary consumers. In the 90s of last century, digital cameras were not widely used, and cameras using film were the mainstream of the market. At that time, Lekai's price remained at around RMB 12 per roll, while Kodak and Fujifilm's film was around RMB 20. Lucky's cost-effectiveness has won many consumers.

The Lucky Group, known as the “king of Chinese film”, originated from the largest photosensitive material industry and scientific research base invested by the government in the 1950s. In 1958, on July 1st, a movie film factory in Baoding, Hebei was established. This is the first film factory of the former Ministry of Chemical Industry of Lekai (hereinafter referred to as a glue).

In 1960, New China used its self-developed and produced film to successfully produce a copy of the movie Bing Lin Cheng Cheng. This film's film is produced by a glue. Before the 1990s, almost all Chinese film makers used film production. At that time, there was no Lekai name. Before "Lok Kai," a rubber used a Taihang Mountain card, a friendly card, a happiness card, and a unique "generational red card".

Since the 1980s, with the impact of television on movies, the market for film has begun to shrink, and Lekai has undergone a transition from film film to film for civilian use and photo paper. The transformation also made Lekai into glory.

Lucky was a transliteration of "LUCKY". The trademark of "Loke" was officially launched in March 1985. That year, Lucky began exporting color film to overseas.

Forcing Kodak and Fuji to cut prices

“Crayon was introduced to the market in the early 1980s (in the last century). It was a roll of 6 yuan at the time.” Li Yuechang, general manager of Lucky Film Co., Ltd., told reporters. The birth of domestic color film in the promotion process in the resistance, Lekai film at the beginning of the listing, some color expansion shop, print shop and even directly declare the statement, saying "Rokkai domestic film washing does not guarantee quality."

Li Yuechang recalled: “At that time, the quality level of Lekai film was indeed a certain gap with the big manufacturers.”

Subsequently, Yuekai introduced new production lines on the one hand to enhance the quality of film; on the one hand, it strengthened its after-sales service, established Lucky's printing network and service system, and laid out Lekai's printing outlets and service agencies nationwide.

As the earliest state-owned enterprises that started the marketization process, Lucky at that time had already established a marketing awareness in the market competition. Not only did they invite international famous photographers to do the testing of Lucky Films, but also carried out the photographic competition of Lucky Films every year.

"In 1989, we used the new production line to produce a new generation of film BR100. The promotion effect was very good. The Lekai brand has been greatly improved." Li Yuechang said.

“The quality of Lucky's late period is very good and the technology is also mature. In civilian products, it is at the same level as Fuji and Kodak.” said Lu Jiebo, deputy secretary-general of the China Electronic Chamber of Commerce, and it is even more critical that the emergence of Lucky has allowed Kodak to emerge. Fuji was forced to adopt a low-price strategy in the Chinese market.

On December 26, 1997, the "Yuekai Film" A shares were issued on the Shanghai Stock Exchange with an issue price of 6.42 yuan. In the second year, Lekai film net profit reached 70.168 million yuan.

In 1999, Lekai film's market share in the domestic market was close to 30%, and it was exported to more than 40 countries. In 2000, Lekai Group occupied 100% of domestic aerospace film market, 70% of film film market, 50% of black and white film share, and 30% of color film share. Lekai also reached its peak, with net profit of RMB 215 million. From color film.

The digital revolution caused a crisis of survival

Red Lucky has always regarded his own biggest enemy is yellow Kodak and green Fuji, but no one thought that the digital technology revolution came so quietly and quickly.

Kodak has repeatedly attempted to acquire Lekai, and instead turned to China to propose an "all-industry joint venture plan." This is the famous "98 agreement" (signed in 1998). External photosensitive material production companies have been included in Kodak, and Kodak paid a $1.2 billion M&A deal. Six photosensitive companies such as Shanghai, Tianjin, Xiamen, Shantou, Wuxi, Liaoyuan, etc. changed their temperament overnight. From the friendly forces of Lekai, they became Kodak’s team. Kodak said that they would use the joint venture to produce low-cost Kodak in China. Color roll.

In 2001, the traditional imaging industry suffered an unprecedented crisis of survival. The digital technology revolution destroyed the industry foundation for the traditional film industry to settle down. The demand for global film turns inflection point, and the consumer market has shrunk rapidly. All manufacturers who rely on film to make a living are facing Choice.

“The total global demand for color film reached the highest point in 2000, and then dropped by an average of about 30% per year.” Fujifilm summed up the crisis that year.

Lucky has also felt the impact of new technologies, but did not expect the market will be so quickly overturned. Since the beginning of the year, Lekai Film’s main business income and net profit have been steadily declining. In 2001, Lekai’s net profit fell by nearly half, only 139.8 million yuan, and its main business income fell to 638 million yuan; in 2002, Net profit fell to 124 million yuan and main business income was 593 million yuan.

"Thought transformation" is more difficult

Lucky has tried more ways to attract consumers. At the end of 2002, the retail price of LeCai Super Gold 100 was reduced by 30% and it was the first to launch a 10-yuan color roll nationwide. However, the low-price strategy failed to regain the trend of the film market. In 2003, the Lucky Film Annual Report showed that net profit further shrank to 80,200,000 yuan. In the same year, Lekai agreed to marry Kodak. Kodak exchanged $100 million in cash and other assets for a 20% stake in Lucky. With this alliance, the market share of the two together exceeds 70% of the domestic film share.

However, the film industry has become increasingly thin, and it has not been able to achieve the desired results. With the digital camera without a film into the millions of households, Kodak has also begun a difficult transition. In 2007, Kodak interrupted the original with the Lucky. Year of marriage.

Lucky's transformation began earlier. "We had a sense of transformation in 2000 and we started to do it," said Li Yuechang. At that time, Lucky's color film and color photo paper were in full swing, but at the same time, the company began to develop film materials and other products, some of which have now become a climate, such as Lucky's optical film, is now the domestic leading level.

At the same time, there have also been many unsuccessful attempts by Lucky, such as digital cameras, inkjet supplies, stereo photography, Minilabs, polarizers... but these explorations have been unsuccessful because of the small size of the investment.

More difficult than market, business, and product transformation is the “ideological transition” of a long-established state-owned enterprise. In Baoding, many Lekai employees have become attached to the film throughout their lives. Parents work here, growing up and studying for themselves. They grew up to take over positions of their parents and they have deep feelings for film. For this reason, Lucky chose the main production base of PET optical film in Hefei instead of Hebei. Zhang Jianheng, general manager of Lekai Group, explained that because “opening up a new plant in the field is another company than in the Baoding Lucky Group Group. It's a lot easier."

In addition, as one of the central SOEs, Lucky cannot lay people off, and it is not possible to significantly reduce pay. The shackles faced during the transition are greater than that of Kodak and Fujitsu.

For the final film factory

The film business, which was once the main source of revenue for Lekai, now accounts for only about 1% to 2% of the Group's turnover. Lokkai Group has formed three pillar industries: image segment (traditional silver salt business), printed materials, film and coating materials.

In the past three years, the net profit of Lucky Films has been between RMB 3 million and RMB 5 million, and rumours of reorganization have never subsided. From the beginning, it may be collected by “CIC II” Guoxin Company and finally The dust settled this month and merged into the Aerospace Science and Technology Group.

Li Yuechang explained that the merger has just been approved by the SASAC, the specific implementation of the program is still in communication between the two sides, from a company's strategic point of view, Lekai has advantages in civilian products; aerospace technology has advantages in the military, aerospace field.

Lekai, known for his film, not only produces films, it is a point that Li Yuechang repeatedly emphasized. After the merger with Aerospace Science and Technology Group, Lekai's brand will continue and pass on, and the focus will still be on civilian products. Although the era of film has passed, the original intention of Lekai “to be the last image producer to withdraw from the silver salt market” has not changed.

"We haven't given up yet." Li Yuechang said that at present, the overseas export volume of Lucky Films is far greater than domestic sales. In developing countries, film still has a market, although this market will eventually be occupied by digital technology.

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Kodak transformation pains continue

The loss year after year is intended to spin off the business restructuring, and recently announced the sale of 1,100 patents, "Kodak invented a digital camera, which became Kodak's gravedigger." Kodak chairman and chief executive Peng Andong remarked that Kodak was helpless in the digital wave. regret.

As early as 1976, Kodak developed the world's first digital camera, but Kodak is satisfied with the market share and monopoly of traditional film products, and even in order to extend the market life of film, he does not hesitate to hide its digital camera technology. It was not until 2003 that it was truly determined to make the transition to digital.

At the same time, Kodak is still reluctant to reconcile its old business, and it has done its best to win China's last film independent brand Lucky. In October 2003, Lucky and Kodak reached a 20-year cooperation agreement, and Kodak will exchange 20% of the shares of Luckyfilm with cash and other assets totaling approximately US$100 million.

The rapid development of the digital market has completely exceeded Kodak's expectations. According to the data, Kodak’s sales revenue from its traditional imaging division dropped from US$14.3 billion in 2000 to US$4.18 billion in 2003, a decrease of 71%.

Although Kodak is struggling to promote transformation, it hopes to create three Kodak business film products, consumer digital images and graphic images. However, the large amount of expenses caused by layoffs, mergers and acquisitions caused Kodak to suffer a long-term huge loss. Kodak lost $113 million in 2004, lost $799 million in 2005, and lost $346 million in 2006.

Kodak has also taken a "slimming down" approach by selling departments and spin-off businesses to reduce costs. In 2006, Kodak spun off its entire digital camera manufacturing business to Flextronics, Singapore. In 2007, Kodak sold the medical imaging division, one of the original four businesses, for $2.55 billion to Onex, Canada’s largest asset purchase company, to reduce its debt concentration in digital businesses. In the same year, Kodak China Co., Ltd. transferred the Lokkai shares held by it to Guangzhou Chengxin Venture Capital Co., Ltd. for a low price of US$37 million.

Just last month, Kodak announced that it will sell 1,100 patents and it is expected that these patents will bring more than $2 billion in revenue for the company.

“The pains of Kodak’s transformation have continued until now,” said Lu Renbo, deputy secretary-general of the China Electronic Chamber of Commerce.

Fuji enters medicine, cosmetics

Extend the technological advantages of the film era to new areas, and form the three major business groups China's film market in the early 1990s was once the world of Fujifilm. Fuji firmly holds over 60% of China's market share. However, in the competition with Kodak, Fuji's share in China has been declining. By 2001, it had slipped to 20%. In the near desperate case, Fuji decided to take digital business as the next key development goal and established the basic idea of ​​digital transformation.

In 1997, Fujifilm began producing digital cameras at its Suzhou plant and supplied a large amount of Chinese market. At the beginning of 2000, when digital was still a fresh concept for most people, the "Magic Hand" digital printing equipment developed by Fujitsu began to land in China Digital Printing. In the same year, Fuji set up its first joint venture in Beijing to produce printing plates.

At the end of 2005, Fuji began to promote new structural restructuring. In the traditional film industry, Fujifilm has already stopped some photosensitive material production lines. By the end of 2007, through the structural adjustment, Fujitsu's business area has expanded to include video, information, and document processing, extending the technological advantages of the traditional silver salt film era to chemical, medical, and high-performance materials.

In March 2008, Fuji spent about US$1.2 billion to enter the medical field. At the same time, Fuji became a cosmetic manufacturer. The technology and raw materials used to produce film were used to produce cosmetics.

Fujifilm Group eventually formed three business groups: an imaging business represented by photographic film, color cameras, and digital cameras; an information business with medical, printing, and liquid crystal display materials as its main products; and a document processor and copier. The printer is the main product of the document processing business.