Article by Zhang Ruichen

Edited by Wu Xianzhi

Recently, various domestic new energy companies announced their delivery volume in October. Among them, BYD once again ranked first with a record of 217,800 units, while the sales of GAC Aion ranked second with 30,063 units, a year-on-year increase of up to 149%.

In the first ten months of 2022, Aion’s cumulative sales exceeded 210,000 units, a year-on-year increase of 134%. It’s worth noting that Aion has now exceeded 30,000 units in monthly sales for two consecutive months. Undoubtedly, from the perspective of sustained growth in sales, Aion has become one of the leading brands in the new energy vehicle market.

As a subsidiary of GAC, GAC Aion was officially operated independently at the end of 2020. Originally just a car series name, it is now the development carrier of GAC’s pure electric vehicle industry and has begun independent financing. In October, Aion completed its Series A financing with a total amount of CNY 18.294 billion and released a 17.71% stake. That means, based on the financing amount, the valuation of GAC Aion is CNY 103.3 billion. At present, the market value of GAC is CNY 130 billion, only CNY 30 billion higher than that of GAC Aion. Looking at the valuation, it won’t be surprising if GAC Aion exceeds GAC someday.

According to media reports, GAC Aion plans to submit an application for an IPO to the securities supervision agency in the second quarter of next year, and it aims to be the first new energy vehicle company to be listed on the Science and Technology Innovation Board.

Investors are willing to give a valuation of over CNY 100 billion in the Series A financing of GAC Aion, mainly due to the perspective of sales growth and high market premiums.## Urgently need to tear off the “ride-hailing” label

In terms of product lineup, GAC Aion currently has 5 models under its brand, including AION S, AION S PLUS, AION Y, AION V, and AION LX. Except for AION LX, the price of the other four models ranges from 137,600 yuan to 269,800 yuan.

As GAC Aion’s first model, AION S is also its best-selling product. Another “sales champion” is AION Y. The common point between the two models is that they are easily accepted by ordinary consumers. With terminal discounts, they can be purchased for just over 100,000 yuan, making them the first choice for most consumers. GAC Aion’s AION S PLUS and AION V PLUS are more like upgraded versions of AION S and AION Y, respectively.

Here is an example of real feedback from an AION S owner:

The average selling price of GAC Aion’s single product in 2021 is 143,700 yuan, which belongs to the mid-to-low-end market price range. Even compared with BYD, whose average selling price is 160,000 yuan, there is still a certain gap, not to mention the new forces like “Wei Xiaoli”.

AION S and AION Y account for over 80% of the monthly sales of E’an. Due to the fact that the selling prices of the two main products are around RMB 150,000, E’an’s brand image has always been positioned as “low-end”. Among Guangqi E’an’s total deliveries in 2021, 43% were contributed by the B-end market, and the AION S, which had the highest sales, had 63% from the B-end. Despite Guangqi E’an’s strong expansion in the C-end market this year and the launch of higher-priced new models, its true data still needs to be discounted.

AION LX PLUS is like a door knocker to push E’an into the mid-to-high-end new energy market. However, it is not something that can be successful overnight to transform into the mid-to-high-end market and seek breakthroughs.

To transform into high-end is not impossible, but the primary goal is to remove the label of “cheap ride-hailing service” from the E’an brand, because in the current domestic market, any association with “ride-hailing service” is equivalent to being incompatible with high-end.

This article is a translation by ChatGPT of a Chinese report from 42HOW. If you have any questions about it, please email bd@42how.com.