Uncover the essence of business, delve into the heart of the enterprise

Author | Tian Jie

On January 1, Thalys (601127.SH), a leading manufacturer of new energy vehicles, unveiled its sales performance for 2024. From January to December, it sold 426,885 units of new energy vehicles, marking a year-on-year increase of 182.84%.

Despite Thalys' nearly tripling of new energy vehicle sales in 2024, December sales dipped slightly, totaling 37,319 units, a year-on-year decrease of 9.57%. This marked the first year-on-year decline in Thalys' new energy vehicle sales since 2024.

Thalys has surged in the new energy vehicle market by leveraging Huawei's strengths in recent years. However, with competition among automakers intensifying, can Thalys sustain its high growth in the existing market?

01

Industry Accelerating Consolidation

Formerly known as Xiaokang Stock, Thalys began its transition to new energy after listing in 2016, aiming to build a global smart car brand. In August 2022, Xiaokang Stock changed its name to "Thalys," signifying its commitment to advancing on the path of high-end intelligent electric vehicles.

However, Thalys incurred losses for four consecutive years from 2020 to 2023, with net losses amounting to RMB 1.729 billion, RMB 1.824 billion, RMB 3.832 billion, and RMB 2.45 billion, respectively, totaling RMB 9.835 billion in cumulative losses.

In 2024, Thalys entered a period of fruition. From January to September, its operating revenue reached RMB 106.627 billion, a year-on-year increase of 539.24%; net profit stood at RMB 4.038 billion, a stark contrast to the RMB 2.294 billion loss incurred in the same period the previous year.

Thalys' improved performance is attributed to a substantial increase in sales. Data reveals that from January to December 2024, new energy vehicle sales totaled 426,885 units, a year-on-year surge of 182.84%.

Notably, despite Thalys' significant sales growth throughout 2024, its new energy vehicle sales in December 2024 experienced a rare year-on-year decline.

In December 2024, Thalys sold 37,319 new energy vehicles, a year-on-year decrease of 9.57%. For the preceding 11 months, Thalys' new energy vehicle sales had been surging, predominantly growing at rates of two to three times or more.

This decline can be attributed to market fluctuations and intensified competition within the new energy vehicle sector.

From a broader market perspective, China's mainstream new energy automakers all achieved significant year-on-year growth in 2024. Industry leader BYD sold over 4.27 million vehicles in 2024, a year-on-year increase of 41.26%, maintaining its top position in domestic new energy vehicle sales; new automaker Li Auto sold over 500,000 vehicles throughout the year, while NIO and Leap Motor also set new sales records; Xiaomi, a crossover automaker, delivered over 135,000 new vehicles in 2024, exceeding its annual target.

Behind these impressive figures, the new energy vehicle market is undergoing rapid consolidation. In 2024, several automakers ceased operations due to broken capital chains, outdated technology, lack of core competitiveness, and other factors. At least 15 new energy automakers announced bankruptcy or entered bankruptcy reorganization in 2024, including HiPhi, WM Motor, and Jiyue Auto.

02

Rumored Hong Kong Listing

Thalys' turnaround in performance and surging sales throughout the year are inseparable from its deep collaboration with Huawei. Zhang Xinghai, Chairman of Thalys Group, publicly stated, "We will firmly maintain our cross-border cooperation with Huawei, staying committed to our goals and blueprint. We are dedicated to serving our customers wholeheartedly and cooperating wholeheartedly with our partners."

Thalys and Huawei have collaborated for nearly four years, jointly launching models such as the AITO M5, M7, and M9. In 2024, the new AITO M5, new M7 Pro, and AITO M9 five-seater versions were successively launched. Among them, the cumulative deliveries of the new AITO M7 exceeded 190,000 units in 2024, ranking first in sales among new force models in China for 12 consecutive months; the AITO M9 achieved cumulative "big orders" of over 200,000 units in its first 12 months on the market, consistently ranking first in sales of luxury models priced at RMB 500,000 and above in the Chinese market.

During its years of collaboration with Huawei, Thalys' R&D investment has continuously increased, rising from RMB 1.949 billion in 2021 to RMB 4.438 billion in 2023, reaching RMB 4.368 billion in the first three quarters of 2024, a year-on-year increase of 300.28%.

Furthermore, Thalys has embarked on an acquisition spree. In June 2024, it spent RMB 1.254 billion to acquire a 55% stake in Thalys Electric; in July, it acquired intellectual property rights related to the "AITO" trademark for RMB 2.5 billion; on August 8, it acquired a 19.355% stake in Thalys Automobile for RMB 1.329 billion and announced plans to invest RMB 11.5 billion in cash in Yiwang on August 26; in October, it spent RMB 8.164 billion to acquire the AITO Super Factory, expanding its production capacity.

The new energy vehicle industry is a high-risk, high-reward sector, and Thalys is well-funded. As of the end of the third quarter of 2024, Thalys had monetary funds totaling RMB 51.44 billion, a year-on-year increase of 366.78%; during the same period, the company had zero short-term borrowings and long-term borrowings of RMB 691 million. In the first three quarters of 2024, the company's operating cash flow turned positive, reaching RMB 20.012 billion.

Recently, rumors have circulated in the automotive industry that Thalys, a close partner of Huawei, may list in Hong Kong. It is reported that Thalys is considering a secondary listing in Hong Kong to raise over USD 1 billion (HKD 7.8 billion). If Thalys decides to proceed, it could list in Hong Kong as early as 2025.

"Thalys can utilize this opportunity to obtain new financing and accumulate sufficient funds for its development," said industry insiders. This is an excellent time for Thalys to raise funds: on the one hand, it benefits from the "Huawei" halo and is currently the automaker with the best sales and deepest collaboration among Huawei's Smart Selection partners; on the other hand, Thalys achieved significant profits in 2024, making it attractive to investors in terms of both concept and performance.

END

Edited by Xiao'er

Typeset by Wu Yue

Chief Editor by Lao Chao

Images sourced from the internet