Summary of Jinlong Automobile Conference Call Company Overview - **Company**: Jinlong Automobile - **Date**: July 22, 2025 Key Points Industry Performance - Domestic demand decreased in the first half of the year, but exports increased by approximately 56%, offsetting the domestic market decline [2][3] - Sales revenue grew by about 6% year-on-year, primarily due to strong overseas performance [2][3] Financial Goals and Management Changes - The new chairman set targets for the company: achieving positive net profit after deductions, increasing gross margin by 2%, and maintaining a return on equity (ROE) of over 6% annually [4][19] - The company aims to increase the proportion of centralized procurement from 24% to 40%, expecting significant cost reductions in the second half of the year [4][6] - The company plans to consolidate R&D efforts from three subsidiaries to the headquarters to enhance efficiency [4] Short-term and Long-term Strategies - Short-term goal is to catch up with Zhongtong Bus's profitability, while the long-term goal is to benchmark against Yutong Bus, with expectations to reach Zhongtong's profitability within two years [7][19] - The company is focusing on improving product quality and brand reputation to capture high-end market segments [12][19] Market Outlook - The company anticipates that the domestic market may improve in the second half of the year, contingent on potential government incentives [9] - The export market is expected to continue its growth trajectory over the next three to five years, assuming stable international economic and political conditions [9][19] Export Market Composition - Export regions: Asia (60%), Europe (20%), Africa (10%), South America (9%), Oceania (1%) [10] - Southeast Asian countries are experiencing rapid growth, while Europe shows steady progress [10] Operational Enhancements - The company plans to enhance its after-sales service system, including technical support and regional parts warehouses, to improve customer service quality [11] - The company is increasing product tiers, including launching a new highway bus platform and manufacturing the Senta brand for Scania [12] Management Changes and Shareholder Actions - Changes in senior management are expected, with key positions transitioning due to retirement [14] - The second-largest shareholder, Fujian Investment Group, plans to reduce its stake by 1% due to funding needs, having already reduced it previously [16][17] Stock Incentives - The company aims to implement stock incentives to boost employee motivation, pending approval from the State-owned Assets Supervision and Administration Commission (SASAC) [18] Profitability and Integration Outlook - The company is optimistic about achieving its annual profit targets and expects to uncover more profits through integration efforts in the coming years [19]