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21st Century Business Herald reporter Song Doudou reports

Recently, the Beijing Equity Exchange issued an announcement on the "GAC Aion New Energy Automobile Co., Ltd. Equity Transfer". The announcement shows that the main body of the investment promotion is China Cinda Asset Management Co., Ltd. (hereinafter referred to as China Cinda), and the disclosure start and end dates are from August 1, 2024 to January 22, 2025. The reference price is shown as "negotiable", but it does not mention the proportion of GAC Aion's equity to be transferred and the requirements for the identity of investors.

The announcement also mentioned that GAC Aion is currently preparing for an IPO on the Hong Kong stock market, and all preparations for the listing are currently proceeding as scheduled.

In response to this, GAC Aion told the 21st Century Business Herald reporter that "this equity transfer is an asset disposal process within the company's 'indirect' shareholders and has no direct relationship with the Hong Kong stock IPO. The progress of the company's IPO is subject to the announcement of GAC Group."

An insider of GAC Aion said that the listed equity transfer is related to GAC Aion’s shareholder Yingke Capital. China Cinda, one of the investors of Yingke Capital, originally expected GAC Aion to IPO within two years, but due to the current delay in the IPO time, China Cinda needs to go through the asset disposal process procedurally.

As of press time, the transfer announcement webpage no longer exists.

According to public information, GAC Aion has previously completed two rounds of financing. In March 2022, GAC Aion completed its Pre-A round of financing with a transaction amount of 2.566 billion yuan; in October of the same year, GAC Aion announced the completion of its A round of financing with a total amount of 18.294 billion yuan, setting a record for the largest single private equity financing in the domestic new energy vehicle industry. After the A round of financing, GAC Aion's valuation rose to 103.239 billion yuan.

In fact, GAC Aion has been planning an IPO for a long time, and has released relevant information to the public many times in the past two years. An insider close to GAC Aion told reporters that after GAC Aion completes its shareholding reform in 2022, its IPO destination will be the Science and Technology Innovation Board. Due to stricter supervision, it switched to Hong Kong stocks in the second half of last year.

For most new car companies that are generally in a state of crazy money burning and have not yet achieved a break-even or even profitability, facing the fierce competition in the domestic new energy vehicle market, they need more funds to invest in research and development, build channels, and complete the smart cabin and smart driving puzzles. Going public has become the best solution to broaden financing channels.

GAC Aion is still in a loss-making state. According to the aforementioned investment announcement, GAC Aion's total assets in 2022 were 37.199 billion yuan, owner's equity was 10.035 billion yuan, operating income was 38.793 billion yuan, and net profit was -2.062 billion yuan. GAC Group stated in its 2023 semi-annual report that GAC Aion achieved profits for two consecutive months in June and July of that year, but has not disclosed relevant information since then.

However, in an interview with 21st Century Business Herald, Gu Huinan, general manager of GAC Aion, repeatedly stated that GAC Aion is not short of money, and the IPO is not for raising money, but to solve the problem of system and mechanism. "If GAC Aion really wants to raise funds, its financing capacity is very strong. In the last round, it raised more than 20 billion yuan, and we are still thinking about where to invest this 20 billion yuan." Gu Huinan frankly said that now is not a good time for IPO, and the performance of the entire capital market is not very good. The progress of Aion's IPO mainly depends on whether the market can pick up in the future.

Since NIO successfully landed on the New York Stock Exchange, countless hot money has poured into the smart electric track, and Tesla's trillion-dollar market value "myth" has pushed the capital carnival to a climax. However, times have changed, and the current financing environment has changed significantly compared to a few years ago. The capital carnival is also cooling down rapidly, and the valuation of the new energy vehicle sector has fallen sharply. A capital market insider told the 21st Century Business Herald reporter that since most vehicle start-ups are in a loss-making state, investors are not willing to pay a premium for the unattainable market returns of electric vehicle companies.

GAC Aion, whose sales have been rising all the way in 2023, is slightly sluggish this year, with cumulative sales of 213,000 vehicles in the first seven months, completing only 30.4% of the annual sales target of 700,000 vehicles. Previously, GAC Aion's AION S, AION Y and other models have become hot-selling models in the online car-hailing market due to their high cost performance, but as the new energy online car-hailing market gradually becomes saturated, the "king of online car-hailing" is also facing considerable growth pressure. Data shows that the share of pure electric vehicles in the online car-hailing market has risen sharply from 10.4% in 2016 to 84.9% in 2023. In addition, the Haobo brand, which GAC Aion has high hopes for, does not have a strong presence in the mid-to-high-end market, and its competitive advantage over Xiaomi SU7, Tesla Model 3, and Zhijie S7 is not obvious.

"In the first half of this year, neither Haobo nor Aion launched new cars, and their technical routes do not yet cover PHEV. It is normal to encounter temporary difficulties." Gu Huinan told the 21st Century Business Herald reporter that three products will be launched in the second half of the year, with a new car every two months, with prices ranging from 100,000 to 700,000 yuan.

In order to find new market growth points, GAC Aion will supplement plug-in hybrid and range-extended models, and plans to launch related products next year. On the other hand, it will also follow the trend of "going overseas" of independent brands and set its sights on overseas markets. In mid-July, GAC Aion's smart factory in Thailand was completed and put into production, with a planned production capacity of 50,000 units in the first phase, and will be expanded to 100,000 units in the future. The first model to be put into production is the right-hand-drive version of AION Y Plus. At the same time, its Indonesian factory is also under planning and construction, and will be put into production at the end of the year, with an estimated annual output of 20,000 units.