Guangzhou Automobile Aion Debunks Rumors of Layoffs, Sales Pressure Mounts for the "King of Online Car-hailing"

06/14 2024 496

Produced by Radar Finance Hongtu | Text by Mo Enmeng | Edited by Shenhai

Relying on Guangzhou Automobile Group, Guangzhou Automobile Aion has recently been plagued by rumors of layoffs. Recent news suggests that all departments of Guangzhou Automobile Aion will lay off 20% of their staff. There have also been revelations from fresh graduates that they have received notices of contract termination from Guangzhou Automobile Aion's campus recruitment.

On the evening of June 12, Guangzhou Automobile Aion issued a serious statement stating that recently, some false information and malicious rumors about "layoffs" and "intensive contract terminations with fresh graduates" at Guangzhou Automobile Aion have appeared on online platforms, causing market misunderstandings and affecting the company's reputation.

Although Guangzhou Automobile Aion has debunked rumors of "layoffs" and "intensive contract terminations with fresh graduates," it is an indisputable fact that the sales of Guangzhou Automobile Aion, which is hailed as the "King of Online Car-hailing," have declined this year. Last year, with over 480,000 retail sales, Guangzhou Automobile Aion ranked third among new energy manufacturers, second only to BYD and Tesla China.

However, in the first five months of this year, Guangzhou Automobile Aion's sales declined by 13.38% year-on-year. Among them, from February to May, Guangzhou Automobile Aion's sales declined year-on-year for four consecutive months. If the current situation persists, to achieve the lower limit of the annual target of 700,000 vehicles, Guangzhou Automobile Aion would need to sell approximately 79,700 vehicles per month in the next seven months.

As the main player in Guangzhou Automobile Group's new energy development, Guangzhou Automobile Aion has been highly anticipated since its inception. Manufacturing new energy vehicles is a long-term and capital-intensive endeavor, so most players need continuous external funding to survive.

As early as 2022, Guangzhou Automobile Aion's A-round financing received strong support from 53 strategic investors, and this round of financing, worth up to 18.294 billion yuan, helped increase Guangzhou Automobile Aion's post-investment valuation to 103.239 billion yuan.

Subsequently, Guangzhou Automobile Aion has repeatedly mentioned IPO plans in public. However, as of now, Guangzhou Automobile Aion has not officially entered the capital market and intends to slow down the IPO pace. In March of this year, Gu Huinan, General Manager of Guangzhou Automobile Aion, candidly stated, "Frankly speaking, now is not a good time for an IPO. The entire capital market is not doing well, and Aion's progress mainly depends on whether the market can recover in the future."

Guangzhou Automobile Aion Debunks Rumors of Layoffs

With the increasingly fierce competition in the new energy sector, automakers are competing in configuration, pricing, marketing, and service. Now, even the top executives of some companies are actively promoting their products.

However, against the backdrop of a seemingly booming industry, there have been rumors of layoffs from many new energy automakers. Not long ago, it was reported that Guangzhou Automobile Aion, known as the "beloved son" of Guangzhou Automobile Group, would lay off 20% of its staff.

According to the plan shown in the screenshot circulating online, in addition to laying off 20% of staff, it also includes canceling overtime pay for all employees, controlling overtime in production lines, reducing transportation subsidies by 70%, reducing telephone subsidies, eliminating paper-based office work, approving business trips to divisional leaders, halving the number of security personnel, canceling overtime pay in management areas, stopping social recruitment, and terminating 20% of offers already accepted for campus recruitment.

According to the 2021 annual report of Guangzhou Automobile Aion New Energy Automobile Co., Ltd. on the Tianyancha platform, the number of people paying social security in the company that year was 3,369, but the company's 2022 annual report did not disclose relevant data. According to a report from Workers' Daily in June last year, Zheng Chunlin, Deputy General Manager of Guangzhou Automobile Aion, once revealed that "Aion has about 7,200 employees, with 29% being R&D personnel."

On June 12, an email titled "Guangzhou Automobile Aion Campus Recruitment Contract Termination Notice" sparked attention online. According to screenshots circulating online, Guangzhou Automobile Aion sent a notice to signed fresh graduates on June 11 stating that due to adjustments in the company's fresh graduate recruitment policy, it would terminate the signed tripartite agreements/bilateral agreements and pay a liquidated damages of 5,000 yuan to those who had their contracts terminated.

For a time, the news of Guangzhou Automobile Aion terminating contracts with fresh graduates sparked heated discussions again. In response, Guangzhou Automobile Aion stated in an interview with National Business Daily that after the autumn recruitment in 2023 and the spring recruitment in 2024, Guangzhou Automobile Aion has recruited and hired 118 fresh graduates from the 2024 session and has recently arranged for them to enter the company in batches.

Guangzhou Automobile Aion also stated that campus recruitment is the result of a two-way selection between the company and job applicants. Due to adjustments in internal departments and staffing needs this year, the company has made minor adjustments to the recruitment needs for certain positions. The scope of this round of campus recruitment personnel adjustments only involves a small number of individuals, which belongs to normal annual adjustments. The HR department will compensate and handle matters reasonably and legally in accordance with the agreement provisions.

Meanwhile, regarding rumors of large-scale layoffs at the factory, Guangzhou Automobile Aion denied them. Guangzhou Automobile Aion revealed that Haopai and Aion are currently recruiting in research and development, marketing, and public relations. The Thailand factory, Changsha factory, and others will also be completed and put into production in July, and the Indonesia factory will be put into production by the end of this year. At the same time, Aion and Haopai will also launch new models within the year, and these projects require a large number of personnel.

Guangzhou Automobile Aion emphasized, "Aion has always been a highly efficient organization. When we produced and sold 270,000 vehicles in 2022, we had 7,000 employees. In 2023, we produced and sold over 480,000 vehicles, and we still had over 7,000 employees."

However, Guangzhou Automobile Aion also stated that under the current market competition environment, the company will strictly control the expansion of personnel scale. Therefore, it advocates internally to increase personnel efficiency by 20% and optimize internal personnel to support new product projects, factory projects, and consolidate its position as a leading brand in the new energy market. There is no layoff plan as maliciously spread on the internet.

On the evening of June 12, Guangzhou Automobile Aion also issued a serious statement through its official Weibo account "Aion AION" regarding rumors of layoffs and contract terminations with fresh graduates. Recently, some false information and malicious rumors about "layoffs" and "intensive contract terminations with fresh graduates" at Guangzhou Automobile Aion have appeared on online platforms, causing market misunderstandings and affecting the company's reputation.

Guangzhou Automobile Aion also stated in the announcement that to safeguard the legitimate rights and interests of the company, the company has officially reported the case to the public security organ on June 12 and will pursue legal responsibility against rumormongers in accordance with the law.

Consecutive Four-Month Sales Decline, Pressure Mounts on the "King of Online Car-hailing" to Achieve Annual Targets

As a new energy brand backed by Guangzhou Automobile Group, Guangzhou Automobile Aion can be considered a player born with a silver spoon. In July 2017, GAC New Energy Automobile Co., Ltd., the predecessor of Guangzhou Automobile Aion, was officially established, and later, the company was renamed Guangzhou Automobile Aion New Energy Automobile Co., Ltd.

Although it has only been a few years since its establishment, Guangzhou Automobile Aion is considered a strategic core carrier for Guangzhou Automobile Group to develop intelligent connected new energy vehicles. With such expectations, the growth rate of Guangzhou Automobile Aion has also been astonishing. Xiao Yong, Deputy General Manager of Guangzhou Automobile Aion, even boldly stated, "We also want to keep a low profile, but our strength doesn't allow us to."

In December last year, it took only 4 years and 8 months for Guangzhou Automobile Aion to achieve multiple prestigious titles, including "the fastest global pure electric brand to reach one million," "the fastest global new energy brand to reach one million," and "the fastest global automotive brand to reach one million."

In 2023, Guangzhou Automobile Aion's annual sales exceeded 480,000 vehicles, representing a year-on-year increase of nearly 80%. In the CPCA new energy retail sales ranking, with 483,623 retail sales, Guangzhou Automobile Aion ranked second only to BYD and Tesla China.

Impressive market performance has filled Guangzhou Automobile Aion with expectations for the new year. At the beginning of this year, Gu Huinan, General Manager of Guangzhou Automobile Aion, set a full-year sales target of "guaranteeing 700,000 and striving for 800,000" for the company. However, entering 2024, Guangzhou Automobile Aion's sales performance has shown a certain degree of decline.

Radar Finance learned from the data released by Guangzhou Automobile Aion's official WeChat public account that in the first five months of this year, Guangzhou Automobile Aion's sales were 24,947 vehicles, 16,676 vehicles, 32,530 vehicles, 28,113 vehicles, and 40,073 vehicles, respectively, with a cumulative sales volume of 142,339 vehicles.

In the first five months of last year, Guangzhou Automobile Aion's monthly sales were 8,206 vehicles, 30,086 vehicles, 40,016 vehicles, 41,012 vehicles, and 45,003 vehicles, respectively. Based on these calculations, the cumulative sales volume of Guangzhou Automobile Aion in the first five months of last year was 164,323 vehicles.

Compared with last year, only Guangzhou Automobile Aion's sales performance in January this year achieved year-on-year growth, while the sales of the other four months all declined year-on-year. The cumulative sales volume of Guangzhou Automobile Aion in the first five months of this year is 21,984 vehicles less than the same period last year, representing a year-on-year decrease of 13.38%.

If we look at the current sales results, Guangzhou Automobile Aion still faces considerable challenges in achieving the annual sales target set by the company previously. Even if we take the lower limit of the 700,000 sales target as a reference, Guangzhou Automobile Aion's sales of 142,339 vehicles in the first five months of this year have only completed one-fifth of the annual target. To achieve the previously set sales target of 700,000 vehicles, Guangzhou Automobile Aion would need to sell approximately 79,700 vehicles per month on average in the remaining seven months.

In fact, Guangzhou Automobile Aion's previous impressive market performance was partly due to orders from online car-hailing services. According to the analysis data on the national taxi and online car-hailing new car market released by the Secretary-General of the CPCA, Cui Dongshu, this year, there were a total of 850,000 new taxi and online car-hailing vehicles last year, of which Aion provided approximately 220,000, accounting for 45% of its annual sales and approximately 25% of the total number of new online car-hailing vehicles last year. In other words, out of every four new online car-hailing vehicles sold last year, one was likely from Guangzhou Automobile Aion.

Based on the aforementioned situation, Guangzhou Automobile Aion has also been crowned the "King of Online Car-hailing" by the outside world, and some netizens have even joked that Guangzhou Automobile Aion is the new energy vehicle brand that best understands unemployed middle-aged people. However, while online car-hailing orders have helped Guangzhou Automobile Aion's sales continue to rise, it has also made it difficult for Guangzhou Automobile Aion to shake off the image of online car-hailing in the minds of some ordinary consumers.

Some industry insiders pointed out that as the online car-hailing market becomes increasingly saturated, coupled with the fact that competitors such as XPeng Motors have also begun to develop the online car-hailing market, Guangzhou Automobile Aion's orders in the online car-hailing market will be affected to a certain extent. At the same time, Guangzhou Automobile Aion's difficult-to-shake online car-hailing label may also deter some ordinary consumers.

To reverse the固有印象 of the brand, Guangzhou Automobile Aion launched the premium brand Haopai in September 2022, but it did not create much of a splash in the market. Taking the Haopai HT as an example, the sales volume of this model was 430 units in April this year, a month-on-month decline of 12.96%. Stretching the time period to the first four months of this year, the cumulative sales volume of the Haopai HT was 1,696 units, ranking relatively low in SUV sales.

Moreover, the intensifying price war in the automotive industry has also put more pressure on players such as Guangzhou Automobile Aion. When previously discussing the topic of the new energy vehicle price war, Gu Huinan, General Manager of Guangzhou Automobile Aion, directly stated, "Don't focus on this year's competition every day. The most important thing this year is to survive. Only by surviving can you have a chance in the next round of changes."

Over 18 billion yuan raised in A-round financing, now intending to slow down the IPO pace

Due to its impressive performance since its establishment, Guangzhou Automobile Aion has once been favored by many investors. Back in October 2022, Guangzhou Automobile Group issued an announcement stating that Guangzhou Automobile Aion would implement capital increase and share expansion through open listing on the Guangzhou Property Rights Exchange to complete its A-round financing and introduce strategic investors.

The announcement showed that Guangzhou Automobile Aion's A-round financing introduced a total of 53 strategic investors, with a total financing amount of 18.294 billion yuan, releasing 17.72% of its shares. After the financing was completed, Guangzhou Automobile Aion's registered capital increased from 6.421 billion yuan to 7.803 billion yuan.

The proportion of equity held directly and indirectly by Guangzhou Automobile Group in Guangzhou Automobile Aion decreased from 93.45% to 76.89%, but Guangzhou Automobile Aion remains a holding subsidiary of Guangzhou Automobile Group.

It is understood that this round of financing for Guangzhou Automobile Aion is the largest single private equity financing in the domestic new energy vehicle industry in recent years. After this round of financing, Guangzhou Automobile Aion's post-investment valuation reached as high as 103.239 billion yuan, making it the highest-valued unlisted new energy automaker in China with a valuation exceeding 100 billion yuan.

In the recently released "2024 Global Unicorn List" by Hurun Research Institute, Guangzhou Automobile Aion ranked 26th on the overall list with a value of 100 billion yuan. Narrowing the scope to China, Guangzhou Automobile Aion tied with Xiaohongshu as the "goalkeeper" of China's top ten unicorns.

In fact, Guangzhou Automobile Aion is not content with being just a unicorn, and it has also considered going public. During the Guangzhou Automobile Group's financial report meeting in August 2022, senior executives of Guangzhou Automobile Group stated that Guangzhou Automobile Aion's mixed-ownership reform is progressing smoothly, and the A-round financing has been officially listed. Next, they will focus on promoting Aion's IPO work.

During the Shanghai Auto Show held in April last year, Feng Xingya, General Manager of Guangzhou Automobile Group, revealed that Guangzhou Automobile Aion successfully completed its A-round financing, with

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