Core Viewpoint - Chery Automobile successfully listed on the Hong Kong Stock Exchange on September 25, 2025, raising HKD 91.4 billion, marking the largest IPO of a car company in the Hong Kong market in 2025, despite challenges in the industry [5][7]. Group 1: Company Growth and Market Position - Chery has become the fastest-growing brand among the top ten passenger car companies in China and the only company among the top twenty globally to achieve over 25% growth in both new energy and fuel vehicles in 2024 [7][8]. - In 2024, Chery's overseas sales reached 1.145 million units, accounting for 40% of its total revenue, solidifying its position as a leading exporter of Chinese cars [10][12]. - Chery has maintained its status as the top exporter of Chinese passenger cars for 22 consecutive years, contributing to its nearly HKD 200 billion valuation in the Hong Kong market [8][10]. Group 2: Financial Performance - Chery's revenue from passenger vehicles in 2022 was RMB 82.511 billion, with a gross profit margin of 13.8%, which is below the industry average of 15%-25% [15][24]. - The company's sales, administrative, research and development, and financial expenses accounted for only 9.5% of total revenue in the first quarter of 2025, showcasing its cost control capabilities [13][17]. - Despite high sales growth, Chery's gross profit margin has been declining, with fuel vehicle margins dropping from 16.3% in Q1 2024 to 14.4% in Q1 2025 [24][25]. Group 3: Challenges and Strategic Shifts - Chery faces a significant reliance on fuel vehicles, with over 60% of its passenger vehicle revenue coming from this segment in Q1 2025, while the market for new energy vehicles continues to grow rapidly [22][23]. - The company has initiated a major restructuring to address its "偏科" (specialization) issues, including the establishment of a new brand management structure and a shift towards resource integration for smart vehicle development [28][29]. - Chery's R&D investment has been relatively low, with a research expense ratio of only 3.3% in Q1 2025, compared to 8.3% for competitors like BYD [26][29]. Group 4: Future Directions - The funds raised from the IPO will be allocated to various strategic initiatives, including 35% for developing different models of passenger vehicles, 25% for next-generation automotive technologies, and 20% for expanding overseas markets [34]. - Chery aims to enhance its product mix and accelerate its transition to new energy vehicles, with a notable increase in the share of hybrid vehicles from 1.6% in 2022 to 17.5% in Q1 2025 [29][30]. - The company is focusing on high-end branding and has prioritized its "智界" (Intelligent World) brand for future product lines, indicating a strategic shift towards premium offerings [30][31].

Core Viewpoint - Chery Automobile successfully listed on the Hong Kong Stock Exchange on September 25, 2025, raising HKD 91.4 billion, marking the largest IPO for a car company in the Hong Kong market since 2025, despite facing challenges in its transition to electric vehicles and maintaining profitability [1][21]. Group 1: Company Performance - Chery's stock opened at HKD 34.2, a rise of 11.22% from the issue price of HKD 30.75, with a market capitalization exceeding HKD 200 billion at one point, closing at HKD 31.92 and a market cap of HKD 184.09 billion [1]. - In 2024, Chery was the fastest-growing brand among the top ten passenger car companies in China and the only company in the global top twenty to achieve over 25% growth in new energy, fuel vehicles, and both domestic and international markets [1]. - Chery's overseas sales reached 1.145 million units in 2024, accounting for nearly 40% of its revenue, with a significant presence in Russia, especially after the outbreak of the Russia-Ukraine conflict [2][4]. Group 2: Financial Metrics - Chery's revenue from overseas sales was reported at CNY 291.5 billion in 2022, CNY 745.3 billion in 2023, CNY 978.7 billion in 2024, and CNY 196.4 billion in Q1 2025, maintaining a stable contribution of around 40% to its total revenue [4]. - The company's overall gross margin was below industry standards, with figures of 13.8%, 16%, 13.5%, and 12.4% from 2022 to Q1 2025, compared to competitors like BYD and Geely, which had gross margins of 20.1% and 15.9%, respectively [7][11]. Group 3: Challenges and Strategic Shifts - Chery's reliance on fuel vehicles remains high, with over 60% of its passenger car revenue coming from fuel vehicles in Q1 2025, while the penetration rate of new energy vehicles in China exceeded 55% [10]. - The company has initiated significant reforms to address its "偏科" (specialization) issues, including restructuring its brand strategy and focusing on electric and hybrid vehicle development [17][19]. - Chery's R&D investment has been relatively low, with a rate of only 3.3% in Q1 2025, compared to BYD's 8.3%, raising concerns about its technological capabilities in the electric vehicle sector [13][14]. Group 4: Future Plans and Funding Utilization - The funds raised from the IPO will be allocated as follows: 35% for developing various passenger car models, 25% for next-generation vehicles and advanced technologies, 20% for expanding overseas markets, 10% for enhancing production facilities, and 10% for working capital [21]. - Chery aims to accelerate its transition to electric and intelligent vehicles while consolidating its advantages in overseas markets, marking the IPO as a new starting point for its transformation [21].

Group 1 - Chery will terminate the Star Era E08 project to make way for Huawei's Zhijie MPV, which is being developed on the E0X-L platform and is expected to launch in the first half of next year [2] - The Zhijie brand, a collaboration between Huawei and Chery, has seen higher sales compared to the Star Era, with cumulative sales of 64,300 units over the past seven months, surpassing the Star Era's 44,200 units [2] - The Star Era series, launched in July 2023, is Chery's highest-priced series, ranging from 172,800 to 319,800 yuan, and was expected to elevate the brand's market position [2] Group 2 - Zhijie faces challenges, including a vague brand image and ongoing dealer qualification screening for new user centers, which may affect its market presence [3] - In June, Zhijie sold only 3,685 units, with the Zhijie S7 selling less than 500 units, indicating a struggle in sales despite the overall growth in the new energy MPV market [3] - The new energy MPV market is experiencing rapid growth, with a 53.3% year-on-year increase in sales in June and a total of 214,100 units sold in the first half of the year, up 49.7% [3]

Core Viewpoint - The partnership between Chery and Huawei has evolved with the signing of the "Intelligent World Brand Strategy 2.0" agreement, which includes the independent operation of the Zhijie brand and a commitment of over 10 billion yuan in funding to establish a 5,000-person R&D team, indicating Huawei's increased control over Zhijie [1][5][10]. Group 1: Strategic Changes - Zhijie will operate independently under the newly formed "Zhijie New Energy Company," with Huawei leading the entire management process from product definition to sales and service [5][7]. - Chery has prioritized Zhijie as a strategic project, allocating unlimited resources and halting the development of the Star Era MPV project to bolster Zhijie's R&D capabilities [5][11]. - The establishment of dual design centers in Shanghai and Shenzhen for Zhijie signifies a significant investment in its brand development [5]. Group 2: Product Launch and Market Response - The new Zhijie R7 and S7 models have begun pre-sales, with starting prices of 268,000 yuan and 258,000 yuan respectively, achieving over 10,000 pre-orders within the first hour [1][8]. - Despite previous challenges, including delivery issues and internal resource conflicts, the new models are expected to enhance Zhijie's market performance and are seen as critical to overcoming past sales difficulties [8][10]. Group 3: Historical Context and Future Outlook - The collaboration between Chery and Huawei has faced challenges, including delivery delays and operational misalignments, which have negatively impacted Zhijie's sales [8][10]. - In the first half of the year, Zhijie sold 45,000 units, which is significantly lower than its competitors, indicating a need for improved market strategies [11]. - The upcoming product cycle for Zhijie, featuring upgraded models with advanced technology, will be crucial for assessing the effectiveness of the new operational model and achieving sales growth [11][12].

Core Viewpoint - Zhijie Automotive officially enters its 2.0 phase, with significant investments and strategic shifts aimed at enhancing its market position and product offerings [1] Group 1: Investment and Development - Zhijie plans to invest over 100 billion yuan and expand its R&D team to 5,000 members [1] - The establishment of Zhijie New Energy Company will allow for independent operations in production, sales, and services [1] Group 2: Strategic Direction - The 2.0 phase will be led by Huawei, focusing on the independent operation of the Zhijie brand [1] - Chery is reportedly shifting its focus entirely to Zhijie, abandoning the Star Era project to support Zhijie's future development and potential IPO [1] Group 3: Product Development - Zhijie is developing a new MPV, expected to launch in the first half of next year [1] - Chery's original luxury MPV, the Star Era E08, has been discontinued, with some team members reassigned to Zhijie [1]

Core Insights - The company Zhijie is developing a new MPV based on the E0X-L platform, codenamed "EHV," which will offer both pure electric and range-extended powertrains [1] - The battery supply for the new MPV will be provided by CATL, with an expected launch in the first half of next year [1] - Chery Automobile has not yet responded to inquiries regarding this development [1] Development Updates - Chery's first luxury MPV, the Xingjiyuan E08, was initially showcased at the Beijing Auto Show last April and is expected to enter mass production this year [1] - Reports indicate that the development of the Xingjiyuan E08 has been halted, with some team members transitioning to Zhijie to enhance the MPV development efforts [1]

Core Viewpoint - The article discusses the competitive landscape of the luxury MPV market in China, highlighting the strategic shift of Chery to prioritize its brand Zhijie over its previous model Xingjiyuan for the launch of the first MPV under the Hongmeng Zhixing platform. This decision is seen as a move to optimize resource allocation and enhance brand competitiveness in a growing segment of the automotive market. Group 1: Company Strategy - Zhijie is developing its first MPV, the EHV, based on the E0X-L platform, with plans for a launch in the first half of next year [1] - Chery has decided to stop the development of the Xingjiyuan E08 MPV, reallocating some of its project team to strengthen Zhijie's MPV development [1][2] - The decision to let Zhijie debut the luxury MPV is part of Chery's broader strategy to streamline its brand operations and reduce resource redundancy [2] Group 2: Market Dynamics - The luxury MPV segment is becoming increasingly competitive, with a notable rise in sales of new energy MPVs in China, which saw a 53.3% year-on-year increase in June [9] - The pricing strategy for Zhijie and Xingjiyuan models overlaps, with Zhijie S7 priced between 249,800 to 349,800 yuan and Xingjiyuan ES priced from 225,800 to 319,800 yuan [3] - Zhijie has shown stronger sales performance compared to Xingjiyuan, with cumulative sales of 64,300 units over the past seven months, surpassing Xingjiyuan's 44,200 units [11] Group 3: Production and Delivery Challenges - Zhijie S7 faced production delays due to equipment and hiring issues at its dedicated factory, leading to a shift in production to Chery's existing facility [3][5] - Initial delivery commitments for Zhijie S7 were extended from 4-6 weeks to over 12 weeks, causing customer dissatisfaction [5] - Chery's commitment to prioritize Zhijie as a strategic project indicates its importance in the company's future growth plans [5] Group 4: Future Prospects - The upcoming launch of the EHV MPV is seen as a critical opportunity for Zhijie to establish itself in the luxury MPV market [14] - The establishment of a dedicated factory for Zhijie is expected to alleviate resource allocation issues and enhance production efficiency [13] - The competitive landscape suggests that while Chery is entering the MPV market later than some rivals, it still has the potential to succeed with the right strategies and partnerships [15]

Core Viewpoint - The article discusses the competitive landscape of the automotive industry, focusing on the development of MPVs by companies like Zhijie and Chery, highlighting the strategic decisions and market dynamics involved in this segment [3][4][14]. Group 1: Development of MPVs - Zhijie is developing its first MPV, the EHV, based on the E0X-L platform, with plans for a launch in the first half of next year [3][4]. - Chery's original luxury MPV, the Xingjiyuan E08, has been halted in development, with some team members moving to Zhijie to strengthen its MPV project [3][4]. - The decision to let Zhijie debut the luxury MPV reflects Chery's strategy to reduce resource redundancy and focus on high-end electric vehicles [4][9]. Group 2: Market Positioning and Competition - The Xingjiyuan series, launched in July 2023, aims at the high-end market with prices ranging from 172,800 to 319,800 yuan, while Zhijie targets a similar demographic but with a higher price point for its models [3][4][14]. - The competition between Zhijie and Xingjiyuan is evident, as both brands target the same consumer base, but Zhijie is positioned to better support the luxury MPV segment [4][14]. Group 3: Sales Performance and Challenges - Zhijie has sold 64,300 units in the past seven months, outperforming Xingjiyuan's 44,200 units, indicating a stronger market presence [14]. - Despite initial success, Zhijie faces production challenges, with delays in the delivery of the Zhijie S7 model leading to customer dissatisfaction [6][19]. - The need for Zhijie to improve its delivery capabilities is critical, as it aims to capitalize on the growing MPV market, which saw a 53.3% year-on-year increase in sales in June [11][19]. Group 4: Strategic Partnerships - The collaboration between Chery and Huawei has been pivotal for Zhijie, with Huawei's technology and market insights playing a significant role in the development of its vehicles [6][19]. - Chery's restructuring into "new four major" divisions aims to enhance brand competitiveness and streamline operations, particularly in the context of its partnership with Huawei [4][6].

Core Insights - The article discusses the competitive landscape in the luxury MPV market, highlighting that Zhijie may have an advantage in launching the first MPV under the Hongmeng Zhixing brand, as Chery has shifted its focus from the Star Epoch E08 to Zhijie for this opportunity [1][6][10]. Company Developments - Zhijie is developing its first MPV, code-named "EHV," based on the E0X-L platform, with both pure electric and range-extended power options, and is expected to launch in the first half of next year [1][6]. - Chery's Star Epoch E08 project has been halted, with some team members reassigned to Zhijie, indicating a strategic shift to consolidate resources and enhance Zhijie's development capabilities [1][3]. - The Star Epoch series, which targets the high-end market, has seen its pricing adjusted, with the starting price dropping to 19.88 million yuan to remain competitive against Zhijie's offerings [4][10]. Market Positioning - Zhijie and Star Epoch are positioned similarly in the high-end electric vehicle market, but Zhijie is expected to perform better due to its higher price point and sales volume [2][10]. - Zhijie's S7 model has a price range of 24.98 million to 34.98 million yuan, while the Star Epoch ES is priced between 22.58 million and 31.98 million yuan, indicating overlapping market segments [2][4]. Production and Supply Chain Challenges - Zhijie faced production challenges with the S7 model due to equipment and hiring issues at its dedicated factory, leading to a temporary shift to Chery's existing production facilities [4][5]. - Despite initial order success for the S7, with over 20,000 pre-orders, delivery delays have raised concerns about production efficiency compared to the Star Epoch ES, which has had smoother deliveries [5][15]. Strategic Partnerships - The collaboration between Chery and Huawei for the Zhijie brand is emphasized as a strategic priority, with Chery's leadership expressing commitment to aligning closely with Huawei's direction to ensure success [5][10]. - The establishment of a dedicated factory for Zhijie aims to eliminate resource allocation conflicts with other Chery brands, enhancing production focus [13][14]. Industry Trends - The demand for electric MPVs is on the rise, with significant year-on-year sales growth reported, indicating a shift in market focus as traditional vehicle segments become saturated [7][10]. - The competitive landscape is evolving, with new entrants and established brands vying for market share in the MPV segment, suggesting a dynamic environment for Chery and its brands [7][15].

Core Viewpoint - The competition for the first MPV under the Hongmeng Intelligent Driving brand is intensifying, with Zhijie potentially gaining an advantage as it develops its MPV based on the E0X-L platform, expected to launch in the first half of next year [1][3]. Company Developments - Zhijie is developing an MPV named "EHV," which will offer both pure electric and extended-range power options, with batteries supplied by CATL [1]. - Chery's first luxury MPV, the Star Era E08, has been halted in development, with some team members transferred to Zhijie to strengthen its MPV development efforts [1][3]. - Chery has restructured its brand strategy, forming "New Four Major" divisions to optimize resource allocation and enhance brand competitiveness [2]. Market Positioning - Zhijie targets a high-end market segment focused on "intelligence, high performance, and innovation," overlapping with the positioning of Chery's Star Era series [1][3]. - The Star Era series, launched in July 2023, is positioned as Chery's premium line, with prices ranging from 172,800 to 319,800 yuan [1]. Sales and Production Challenges - Zhijie S7 has received over 20,000 pre-orders but faces production challenges due to equipment and hiring issues at its dedicated factory [3][4]. - Chery has redirected the production of Zhijie S7 to its Wuhu Intelligent Connected Super Factory, originally intended for other models, indicating tight production capacity [4]. Competitive Landscape - The market for new energy MPVs in China has been growing, with sales reaching 45,100 units in June, a 53.3% year-on-year increase [7]. - Zhijie has sold 64,300 units in the past seven months, outperforming the Star Era's 44,200 units, indicating a stronger market presence [8]. Future Prospects - The successful launch of Zhijie's MPV could serve as a new growth point for the brand, especially as it aims to establish a distinct identity separate from other models under the Hongmeng Intelligent Driving umbrella [9][10]. - The company is in the process of establishing dedicated sales centers for the Zhijie brand to enhance its market presence and brand image [9].