Analysis of the reasons for the bankruptcy of Luoyang construction three-wheeled motorcycle industrial park

Abstract

Luoyang Construction Three-Wheeled Motorcycle Industrial Park in Yuetan Town, Luoyang City, was once a major industry driving local economic development. However, most firms in the park faced bankruptcy within a few years. This paper conducts a qualitative experiential analysis case study from a supply chain perspective. Financial statements and court-issued lists were analyzed to establish the chronological developmental history of motorcycle factories and parts manufacturers in the area. The reasons for bankruptcy were identified and prioritized, with management decision-making, excessive expansion, and high-risk investments being the main causes of motorcycle factory bankruptcy. Unfair competition and financial issues were also contributing factors. For parts manufacturers, bankruptcy primarily resulted from unfair competition’s credit selling practices, followed by funding shortages. Analyzing these reasons serves as a warning and provides potential solutions for similar enterprises facing challenges.