Foshan's Wealthiest Farmer Bankrupt

Court ends an era for Chigo (志高空调)

A Foshan court has declared Chigo (志高空调) formally in bankruptcy liquidation, ending a two‑decade run that once saw the company challenge China’s appliance giants. On 12 February 2026 the Nanhai District People’s Court ruled the company insolvent after mounting liabilities, a legal finish to a brand that rose from a village repair shop to national prominence — and then unraveled under debt and strategic drift. How did a firm that once signed Jackie Chan and boasted triple‑digit ambitions collapse so decisively?

From repair shop to industry heavyweight — reportedly

It has been reported that Chigo’s founder, Li Xinghao (李兴浩), rose from farming roots and began with an air‑con repair stall before founding the company in the early 1990s with Taiwan partners. The brand won lower‑tier city markets through aggressive price cuts and a “lifetime warranty” service pitch, and by the 2000s had joined Gree (格力), Midea (美的) and Haier (海尔) among the country’s top manufacturers. Reportedly, at its peak Chigo posted annual revenue in the billions and was ranked fourth in market share by sales volume.

Strategy failures and asset carve‑out

The collapse traces to strategic missteps and cash‑flow stress. Chigo slashed R&D spending as rivals invested heavily in compressors and digital channels; it doubled down on an increasingly inefficient offline dealer network while competitors pushed e‑commerce and supply‑chain integration. It has been reported that the old corporate entity carried some 3.2 billion yuan of bad debt, while a new vehicle, Zhigao Gewu (志高格物), has emerged after an asset‑and‑debt carve‑out — a separation that creditors and courts will now scrutinize. Cross‑sector investments and losses in finance, property and media also drained resources, turning past market share into an unsustainable balance‑sheet burden.

What this means beyond Foshan

The case is a cautionary tale for China’s mid‑tier manufacturers as domestic consolidation accelerates and global trade frictions push companies toward vertical integration and higher‑end technology. Western readers should note: appliance wins in China increasingly require scale, proprietary components and digital sales channels — not only low prices. Policymakers and creditors will watch whether regulators permit more asset restructurings like Chigo’s, and whether carved‑out successors can compete without assuming older liabilities. The brand that once symbolized China’s confident consumer‑goods boom is now a reminder that past market momentum can evaporate fast.