Chinese OEM Gionee declares bankruptcy after CEO gambled away US$144m at a casino
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Chinese smartphone OEM Gionee has been in dire straits for a while now, and the company has finally filed for bankruptcy.
The company fortunes took a steady dive right around 2016, and it was visible to the average Gionee fan, with devices seeing a decrease in quality and an unexplainable increase in price, likely in a bid to widen profit margins and keep the company afloat. Sadly, that has turned out to be a bad move, as companies like Xiaomi and Honor offer significantly more attractive options at all the price points Gionee used to compete in.
The company’s management also carries quite a lot of the blame. Just last month, CEO Liu Lirong was reported to have squandered over US$140 million at a casino. Of course, Liu has denied the suggestion that those were company funds, but we’re inclined to disbelieve.
Gionee is said to owe over US$3 billion, with over half of that amount being to banks. Suppliers and agencies are also notable items on the list of creditors.
It’s a tad sad to see a company go out this way, especially since it was on the up only a few years ago. We don’t expect to see Gionee back in any noteworthy capacity anytime soon, if at all, and the story of Liu Lirong’s failed ward will be told in years to come as a prime example of the consequences of poor management.