BAIC MOTOR advances into range extension

Author | Wang Xiaojun

Editor | Chai Xuchen

The deep transformation of the automotive industry is reflected in every player, and as a "veteran" enterprise in China's automotive industry, BAIC has not been very vocal in recent years.

However, since last year, BAIC has begun a series of changes: personnel reshuffling, strong promotion of independent brands, and betting on extended-range vehicles... This time, BAIC is betting on its most representative brand, Beijing Off-road, to transform and focus on the extended-range segment of rugged off-road vehicles.

On April 7th, the Beijing Off-road BJ40 extended-range model was officially launched. From the new starting price of 150,000 yuan, BAIC shows its courage to go all in.

Off-roading is BAIC's stronghold, and nearly 70 years of rugged off-road genes give BAIC absolute authority. Against the backdrop of shrinking traditional fuel vehicle business and sluggish transformation to new energy, Beijing Off-road has become one of the few highlights for BAIC.

In 2024, the sales of the Beijing brand (including off-road vehicles) are expected to reach 173,000 units, showing a year-on-year increase. Among them, the sales of off-road SUVs increased by 34% year-on-year, and export sales increased by 48% year-on-year. The BJ40, as a representative model, has an average monthly sales of about 3,000 units, ranking at the forefront of its segment, and the launch of the extended-range new vehicle is expected to further expand its market share.

The launch of the Beijing Off-road BJ40 extended-range model is an important attempt by BAIC to leverage its expertise in the extended-range field.

For off-road vehicles, outdoor travel requires no anxiety about refueling, while urban travel desires lower costs; extended-range/hybrid is the solution currently offered by the industry. The BJ40 extended-range can achieve a comprehensive range of 1,200 kilometers when fully fueled and charged. When launching the extended-range new vehicle, the BJ40 fully utilized internal resources from the group to equip this vehicle with the same extended-range system and technical support as the Xiangjie model.

In terms of pricing, BAIC has also set a highly competitive price for this vehicle. The new car is divided into two versions, with the standard version priced at 179,800 yuan and the advanced version at 199,800 yuan, with a minimum price of 154,800 yuan after the national trade-in and replacement subsidies. This is 70,000 yuan cheaper than the expected price and about 80,000 yuan cheaper compared to the Fangcheng Leopard 5.

The competitiveness of the price is directly reflected in the orders, with the vehicle's orders exceeding 3,000 units within an hour of its launch. As a model positioned in a niche segment, this achievement is also remarkable.

The launch of this new vehicle is just one aspect of BAIC's transformation.

Since last year, BAIC has already begun significant reforms in organizational structure and other areas. After veteran Zhang Jianyong took over as chairman, he initiated a series of reforms.

Zhang Jianyong set a new goal for BAIC—to achieve the "renewal and upward movement" of the BAIC brand within three years, enhancing brand awareness and reputation; and to achieve a "brand leap" for the BAIC brand within five years, along with the increase in sales and brand strength, positioning the company's brand influence and reputation among the top in China's automotive enterprise groups, with independent brands stabilizing in the "first tier." This year, a series of personnel changes continue, optimizing the resource allocation of independent sectors through a younger and more professional team, concentrating resources to break through the two major brands of Beijing Aito and BAIC MOTOR.

In addition, another significant change this year is that BAIC Blue Valley (BAIC New Energy) has changed its Chinese name to "BAIC Aito New Energy Vehicle Co., Ltd."; in terms of models, Aito has cut two pure electric models from its product line while increasing the range-extended models, and will also develop Aito brand MPV products based on the BAIC Blue Valley BE22 platform.

A series of changes also reflect BAIC's current anxiety. After all, BAIC faced profit fluctuations last year and is currently facing difficulties such as sluggish growth in joint ventures, the rise of independent brands not yet materializing, and the new energy transition falling short of expectations.

In the past, the two joint venture brands, Beijing Benz and Beijing Hyundai, contributed stable profits to BAIC, especially Beijing Benz, which once contributed about 90% of BAIC's profits, allowing BAIC to bask in the warm and humid era of stability.

However, in recent years, joint venture brands have been squeezed by independent brands, and luxury brands are also struggling to resist this trend. The decline in Mercedes-Benz profits has also affected BAIC's profits.

Looking at the listed company BAIC MOTOR, its revenue last year was 192.496 billion yuan, a year-on-year decrease of 2.8%; the net profit attributable to the parent company was 955 million yuan, a decrease of 2.074 billion yuan compared to the same period last year, down 68.5%.

What is even more concerning is that in the current era dominated by new energy, BAIC MOTOR's revenue from fuel vehicles was 184.969 billion yuan, a slight increase of 1.2% year-on-year; however, revenue from new energy vehicles was "halved" year-on-year, down 50.7% to 7.526 billion yuan.

Currently, the remaining new forces in the automotive industry each have their own chips, and traditional car manufacturers are also changing leadership and preparing for a fierce attack. The new round of competition is clearly going to be more intense, and BAIC obviously needs to enhance its profitability and improve its brand competitiveness, all of which require more market-recognized products. The BJ40 range-extended model is leading the charge, but more models are needed to follow up.

2025 marks the starting year of BAIC Group's "Three-Year Leap" plan, which aims to achieve total vehicle sales exceeding 3 million units by 2027, with annual sales of independent brands reaching 2 million units and new energy vehicles accounting for more than 50%.

This year, BAIC has planned more than a dozen new vehicles. It is evident that another counterattack by the old players in the automotive circle has already begun