Former billion-dollar car-making star has faded

Author | Wang Xiaojuan

Editor | Zhou Zhiyu

From being a star new force hotly pursued by capital, ranking in the top three of new forces, to now achieving only 25% of its annual sales target, the once highly valued car-making star Ai An is now somewhat desolate.

In June this year, Ai An sold 35,027 vehicles, a year-on-year decrease of 22.18%. In the first half of this year, Ai An's cumulative sales reached 177,366 vehicles, a year-on-year decline of 15.3%. Considering Ai An's annual minimum sales target of 700,000 vehicles, the current sales completion rate is only 25.34%.

Facing a brutal price war, Ai An's main selling models are leading in the 100,000-150,000 yuan price range. In the first half of the year, Ai An only exceeded 40,000 vehicles in May, with less than 40,000 vehicles in the other months, and even sold only 16,700 vehicles in February, nearly halved compared to the same period last year. Looking at individual months, Ai An has experienced negative year-on-year growth for 5 consecutive months.

Compared to the booming new energy vehicle market, Ai An's performance is also poor. In the first half of the year, the overall new energy vehicle sales increased by 33%. Against the backdrop of "the strong get stronger" among industry leaders, Ai An's sales decline is not an optimistic signal.

The ride-hailing market is gradually saturating, which has also to some extent affected this "king of ride-hailing".

AION S is Ai An's sales champion, accounting for more than half of Ai An's monthly sales last year. However, this model, touted by Ai An as "specially tailored for the ride-hailing market," has been selling below 20,000 units since October last year, and this year, there have even been months with less than 10,000 units sold.

As for the high-end product line Haobo that Ai An placed high hopes on, since its release, the highest monthly sales volume has been just over 2,000 units, and recently, sales have dropped to less than a thousand units.

The decline in Ai An's sales has also affected its parent company GAC Group. In a recent report, UBS pointed out that although Ai An is a pioneer in electrification, it is being surpassed by competitors. Coupled with the downturn of joint ventures like GAC Toyota and GAC Honda, UBS has also downgraded GAC Group's rating from "Buy" to "Neutral" and significantly reduced the target price.

This starkly contrasts with Ai An's glory two years ago when it was highly sought after in the capital market.

In 2022, Ai An was a star new force chased after in the capital market. That year, Ai An completed two rounds of financing, with 53 investors from the industry and institutions subscribing to 18.294 billion yuan in the A-round financing in October 2022, pushing Ai An's valuation to over a trillion yuan. The expensive shares had to be fought for, and Ai An was then the most promising new car-making force.

Also in that year, in just half a year, Ai An's valuation soared from 40 billion to 100 billion.

Ai An also delivered impressive sales figures to investors. By 2023, Ai An's sales began to rapidly rise, surpassing 40,000 vehicles in March. In the new energy rankings, Ai An often ranked just below BYD and Tesla China. At that time, the top three in sales became the "BTA", and Ai An once again created a myth in the automotive industry Also last year, taking advantage of the significant increase in sales, Ai An was telling the story of focusing on the high-end market, aiming to complete an IPO last year. During the 2023 Shanghai Auto Show, GAC Group's general manager Feng Xingya stated that they are striving to complete an IPO in 2023.

However, Ai An's path to listing has not made any progress so far. In response, Ai An's general manager Gu Huinan stated in March of this year that now is not a good time for an IPO, as the entire capital market is not favorable, including both the mainland and Hong Kong markets. The progress of Ai An's IPO depends on whether the market can recover in the future.

This slow progress has disappointed many investors. An institutional investor told Wall Street News that his institution, at that time, could not participate in Ai An's Series A financing due to Ai An's high valuation, and instead turned their attention to ZEEKR. Now, ZEEKR has successfully gone public in early May, with sales exceeding 20,000 vehicles this month.

In the current market environment, Ai An wants to once again attract investors in the capital market, and needs to achieve more in terms of sales, profits, and other aspects.

On one hand, Ai An needs to accelerate the speed of launching new cars.

In the industry, in just the first half of the year, there were about 200 new cars (including facelifts) launched. Ai An's current four models were all launched in 2019 and 2020, and are now minor facelifts. In comparison, "King of Sales" BYD basically releases a new car or facelift every six months, and new forces typically have at least two cars launched per year.

In the B2B market and overseas markets, Ai An is also seeking breakthroughs.

When announcing the sales volume in June, Ai An also announced that its factory in Thailand is about to be completed. Ai An only entered the Thai market last year, and among the brands that entered, the sales were not impressive, selling about 500 cars per month, which is clearly not enough to support the factory.

In Thailand, Ai An is also following its familiar path, focusing on the B2B market. In May, Ai An delivered 200 (first batch of 50) AION ES taxis to the Suvarnabhumi International Airport in Thailand.

Targeting the B2B market may be a differentiated competitive route on the road to going global, but it is not easy to reflect this in sales.

In addition to Southeast Asia, Ai An also announced that in the next 1-2 years, they will establish seven major production and sales bases in Europe, South America, Africa, the Middle East, and East Asia. However, overseas markets also face policy pressures and fierce competition from peers.

Although Ai An is also a second-generation player in the automotive industry, backed by a strong financial support from its parent company, in the relentless market competition, Ai An still needs to find its own path to growth again in order to survive in this elimination game