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as expected, huawei's mate xt tri-fold phone is launched.

according to the idc report, huawei's share of china's foldable screen market in 2023 has reached 37.4%, ranking first.

this market appeal built on technology and brand power also applies to the automotive market.

on august 6, richard yu, chairman of huawei's terminal bg and intelligent driving solutions bu, revealed more information about huawei's "fourth realm". it was revealed that the brand was jointly created by jac motors and huawei, with high-end models and a price tag of millions.

as soon as the news came out, jac motors hit the daily limit the next day, closing at 20.27 yuan, an increase of 9.98%.

according to the latest news on september 11, huawei technologies co., ltd. has recently transferred more than ten text and graphic trademarks such as "zunjie", "maextro" and "mas-tro" to jac motors.

photo/pacific automotive network

it can be said that the cooperation between jac and huawei is progressing steadily.

"tanke travel" learned that the first product of the zunjie brand has actually entered the vehicle verification stage. it is planned to roll off the production line at the end of this year and be officially launched in the first quarter of next year.

as the last piece of huawei's "four boundaries" map, the zunjie project jointly created by jac and huawei has already allowed jac to reap the benefits of huawei's "golden signboard".

a research report recently released by huaxin securities pointed out that in-depth cooperation with huawei is expected to drive the company's passenger car brand upward, and gave jac motors a buy rating.

however, apart from the market confidence brought by huawei, jac motors' own performance and development are quite weak.it is reported that jac motors has had negative non-net profit for seven consecutive years and the company has been in a loss-making situation for many years.

at present, zunjie’s “boot” has not yet landed, and the market response and the development of jac motors are still unknown.

1. how does “big brother” make money by transforming into new energy?

looking at the auto market, jac motors is an inconspicuous one, whether among all automakers or among huawei's partners.

founded in 1964 and started in hefei, anhui, jac motors is a traditional automobile manufacturer covering passenger cars and commercial vehicles. the combination of passenger cars and commercial vehicles is the characteristic of jac motors and has also been its way of survival for a long time.

in the ten years from 2006 to 2016, jac motors achieved rapid development, with annual production and sales soaring from 170,000 vehicles to 640,000 vehicles, achieving a qualitative leap. at that time, byd's annual sales were only at the level of 500,000 vehicles.

but then, with the advent of the new energy vehicle era and the intensified internal competition in the automotive industry, jac motors, which was slow to transform and lacked core competitiveness, was on the verge of being "eliminated".

in fact, jac, which originated from a traditional car company, is not late in the transformation to new energy.as early as 2010, jac motors launched the jac iev series of models and began its new energy layout.

in the market at that time, new energy vehicles were scarce and new car manufacturers had not yet entered the market. jac motors, which had an early layout of new energy, also attracted market attention and occupied a certain market share. it was reported that in 2012, jac iev accounted for more than 20% of the electric vehicle market with sales of only 2,485 units.

but the good times did not last long. with the high-profile entry of new car manufacturers, the penetration rate of new energy vehicles increased rapidly in the next few years, and more and more players entered the market.

an owner who bought a car from a new car brand in 2019 told tanke travel that the new car brand is not only a new brand, but also a newly developed product based on a pure electric platform with strong strength. coupled with the completely different service experience from the original, it is hard not to choose a car from a new car brand.

on one side is the pure electric platform, a brand new development, and on the other side is the oil-to-electric platform, an old tradition. the balance of consumer choice has begun to tilt significantly.

however, jac motors has always lacked autonomy in the research and development of new energy vehicles and has been unable to keep up with the pace of the times.

in 2023, jac motors began to significantly increase its r&d investment, with that year's r&d investment reaching 2.235 billion yuan, and will invest another 25 billion yuan in r&d in the next five years.

in april of the same year, jac motors set out again in the field of new energy and established a new energy brand, jac yttrium. its first pure electric compact car, yttrium 3, was also released in may.

photo/ jac motors official website

before the launch, li ming, general manager of jac motors, said that the target of yttrium 3 was to sell 10,000 vehicles per month, but this highly anticipated model ultimately failed to meet expectations.data from the china automobile dealers association showed that in june 2023, the month of delivery, yttrium's sales in march were only 1,061 vehicles.

data shows that jac motors' annual sales in 2023 will be 592,000 units, even lower than the data level in 2016. after seven years of development, its sales have stagnated. among them, the annual sales of new energy vehicles are only 186,000 units, which is barely on par with byd's monthly sales, and is far behind the market.

the latest sales data show that in the first eight months of this year, jac motors' cumulative sales of new energy vehicles reached 18,500 units.

in the semi-annual report of jac motors, the poor sales have dragged down the company's performance. the financial report shows that the company's revenue in the first half of the year was 21.34 billion yuan, a year-on-year decline of 4.77%. the net profit attributable to the parent company was only 301 million yuan, despite a year-on-year increase of 93.84%. after deducting non-recurring gains and losses, the profit in the first half of the year was 91.87 million yuan.

2. surrounded by women, unable to find external help

in fact, jac motors did not leave many memorable points in the market. instead, its continuous external cooperation became the focus of attention and also became its "profit cow" for a long time.

as early as 2016, jac motors cooperated with the new car-making force nio, becoming one of the earliest companies to cooperate with the new car-making force in oem. both parties benefited mutually, nio authorized jac motors' trademark and technology for a trial period, and jac motors was responsible for production and manufacturing.

in this exemplary cooperation, in order to meet nio’s product requirements, nio and jac also worked together to build the jac nio advanced manufacturing base.

but where there is a team, there are frictions. a source revealed that although nio participated in all aspects of the factory transformation and manufacturing, jac's team always had a high voice, and the two sides also had some business disputes.

the series of problems caused by this communication also affect nio's later delivery progress and production rhythm to a certain extent.

finally, nio acquired jac’s assets and owned its own factory. after eight years of oem work for jac, it obtained the qualification to manufacture cars.

in october 2023, jac motors issued an announcement stating that it plans to transfer part of its assets for 4.5 billion yuan through public listing. this part of the assets is exactly the oem factory that jac and nio had previously cooperated on.

in december of the same year, the ministry of industry and information technology's vehicle manufacturing enterprise information management system was updated to show that nio automobile technology (anhui) co., ltd. obtained independent production qualifications. nio, which obtained independent car manufacturing qualifications, eventually acquired part of jac motors' assets for 3.158 billion yuan.

in this cooperation, jac motors' biggest gain is the oem fee. according to nio's financial report data, between 2018 and 2022, nio paid jac motors a total of about 3.038 billion yuan in oem fees. this oem fee is close to the price nio paid to acquire the jac factory.

after nio, seeking external cooperation has become jac's comfort zone.

in 2017, jac motors acquired volkswagen and established jac volkswagen with each investing 50% of the capital. it became volkswagen's third joint venture in china. subsequently, the two parties jointly launched a new electric vehicle brand sihao.

photo/ jac motors official website

but just three years later, the cooperation model between jac and volkswagen began to "collapse".

in the face of the failure of its new car sihao e20x, in 2020, volkswagen invested 1 billion euros to acquire a 50% stake in anhui jac automobile group holding co., ltd., and at the same time increased its stake in jac volkswagen to 75%, gaining actual control of the joint venture.

in the view of zhang xiang, secretary general of the international intelligent transportation technology association,the two collaborations did not essentially improve jac motors' business, but instead missed development opportunities.

3. huawei, the only hope

relying on huawei has become jac motors' new strategic choice.

public information shows that in december 2023, jac motors and huawei officially signed an agreement. the two parties will fully cooperate in multiple fields such as product development, production and manufacturing, sales, and services to create luxury intelligent connected vehicles.

this cooperation means that jac motors has officially entered huawei’s circle of car-making friends and become the last member of the “huawei four circles”.

before jac motors, the market had witnessed the impact of the word "huawei" on the automobile brand.

according to avic securities, in the second quarter of 2024, 14,000 new m5s, 37,000 m7s and 48,000 m9s were delivered. the rapid increase in the volume of high-end models directly led to an increase in the gross profit margin of seres. it is reported that seres' gross profit margin in the second quarter was 27.47%, even exceeding byd and tesla.

the terminal sales have already proved that seres has emerged and is running well.

photo/ seres official weibo

the verification of the successful cooperation model is also driving the continuous acceleration of cooperation between jac and huawei.

in march this year, jac motors and huawei signed a memorandum of cooperation, which stated that the two parties will jointly define scenarios and design experiences based on harmony os, which is based on open harmony, and start the development of hongmeng native applications.

in april, the anhui provincial department of ecology and environment released information about the "jac annual production of 200,000 mid-to-high-end intelligent pure electric passenger vehicle construction project environmental impact report". the report shows that jac automobile has built two pure electric platforms (de and x6). the first is to focus on building a new new energy exclusive platform (de platform) to meet the domestic economic and improvement market needs.

second, through the empowerment of huawei's intelligent technology, a new luxury new energy platform (x6 platform) was developed to actively seize the domestic high-end market, covering large and medium-sized mpv models, with a planned annual production capacity of 35,000 vehicles. the model is expected to be 5.2 meters long and have a wheelbase of 3.2 meters.

this also confirms the outside world's speculation that jac and huawei will cooperate on high-end car models.

at the "hongmeng intelligent travel enjoy world s9 and huawei all-scenario new product launch conference" held on august 6, yu chengdong officially announced the latest plan of the "four worlds" for the first time. "hongmeng intelligent travel will have aito ask world in cooperation with seres, luxeed zhijie in cooperation with chery, stelato enjoy world in cooperation with baic, and maextro zunjie in cooperation with jac."

the jianghuai zunjie was thus renamed.

xiang xingchu, chairman of jac motors, also made it clear that zunjie's first product has now entered the vehicle verification stage, will roll off the production line at the end of this year, and will be available for sale in 2025.

embracing huawei and launching high-end models seems to be the "only hope" for jac motors to transform into new energy.

according to statistics from tanke travel, jac motors has had negative non-net profits for seven consecutive years. from 2017 to 2023, jac motors achieved non-net profits of -0.93 billion yuan, -1.877 billion yuan, -978 million yuan, -1.719 billion yuan, -1.884 billion yuan, -2.795 billion yuan and -1.718 billion yuan respectively.

even if the company turns losses into profits in the first half of 2024, it is based on considerable government subsidies. it is reported that jac motors made a profit of 301 million yuan in the first half of the year, but the government subsidies included in the current profit and loss exceeded 150 million yuan.

previously, jac motors' revenue also relied heavily on subsidies. data shows that in the three years from 2021 to 2023 alone, jac motors received government subsidies of 2.005 billion yuan, 1.205 billion yuan and 1.34 billion yuan, totaling 4.55 billion yuan.

in order to achieve its performance goals, jac motors is also constantly clearing marginal assets, including selling import and export companies. in october 2023, jac motors sold its 70% stake in jac import and export co., ltd., which is responsible for jac motors' imported wine business.

after clearing out marginal businesses and focusing on car manufacturing, jac motors has made sufficient preparations for jac zunjie. under the pressure of performance, zunjie has also become jac's "lifeline".

but huawei still has many trump cards in its hand.

according to the official data released by hongmeng intelligent driving, in august 2024, 33,699 new cars were delivered across the entire series, of which 31,216 were from the aito series. in other words, the sales volume of aito series accounted for more than 90% of the entire hongmeng intelligent driving ecosystem.

there are not many opportunities left for latecomers. previously, jac motors has won a lot of attention from the capital market with its reputation as a huawei company, but whether its future products can be recognized and thus seize the high-end pure electric market remains uncertain.

for jac motors, it is indeed a bit difficult to replicate the myth of seres.