Modern Economics & Management Forum

The first default of Shanghai Chaori Solar's bonds in 2014 marked the end of the "zero-default era" in China's bond market. By 2020, bond defaults in China peaked, with a notable increase in defaults among highly-rated state-owned enterprises. Among them, Brilliance Auto Group, a major state-owned enterprise in Liaoning Province, had long maintained a AAA rating and held a significant position in the traditional automotive sector. However, it experienced a massive bond default of RMB 17.2 billion within a short period, revealing a stark contrast in its operational performance. This paper provides an in-depth analysis of Brilliance Auto Group's bond default case, examines the underlying causes, and proposes effective strategies to mitigate bond default risks based on the findings.