Recently, Thalys Group (hereinafter referred to as "Thalys") has officially announced its intention to list on the Hong Kong Stock Exchange, issuing overseas-listed foreign shares (H shares) on the main board. With its current A-share market value exceeding 200 billion yuan, Thalys is poised to potentially become the largest IPO in the automotive sector globally in 2024. The funds raised from this Hong Kong listing will be allocated to technology research and development, overseas expansion, and capacity enhancements.

Stockstar observed that on the day the prospectus was released, Thalys also unveiled its 2024 financial report. Leveraging its close collaboration with Huawei and optimizing its product line, the company achieved double-digit growth in revenue and profit in 2024, successfully transitioning from losses to profits, and becoming the fourth globally profitable new energy vehicle company.

However, Thalys, which has heavily relied on Huawei's influence to "survive," now faces the challenge of resource diversion. As Huawei's HarmonyOS Intelligent Driving continues to expand its reach, Thalys is no longer Huawei's sole focus. Data indicates that sales have been declining since the beginning of 2025, in stark contrast to the growth trajectory of domestic new energy vehicles. Notably, Thalys' self-owned brand sales are also struggling.

With this IPO, Thalys aims to concentrate on overseas markets. Prior to the listing, its subsidiary Thalys Automobile introduced strategic investors such as ICBC Investment and BOCOM Investment, with an additional capital injection of 5 billion yuan to pave the way for the IPO. Nonetheless, the overseas market for new energy vehicles remains unpredictable, and for Thalys, which still lacks a stable brand presence abroad, the path to international expansion is long and arduous.

01. Turned Losses into Profits Last Year, but Sales Declined This Year

The 2024 annual report reveals that Thalys achieved operating revenue of 145.176 billion yuan, a year-on-year increase of 305.04%, setting a new record. Net profit attributable to shareholders reached 5.946 billion yuan, marking the company's first profitable year since its listing.

It is reported that Thalys' predecessor was Xiaokang Stock. In 2016, Xiaokang Stock established Thalys, which operated primarily under Chongqing Jinkang New Energy Automobile Co., Ltd., a subsidiary of Xiaokang Stock. The company's name was changed to Thalys Group Co., Ltd. in 2022.

Well-known for being a "money-burning" industry, the automotive sector has historically posed challenges for Thalys, which suffered losses year after year. From 2020 to 2023, Thalys accumulated losses of nearly 10 billion yuan, despite revenues of 14.3 billion yuan, 16.72 billion yuan, 34.1 billion yuan, and 35.84 billion yuan, respectively, with losses of -1.729 billion yuan, -1.824 billion yuan, -3.832 billion yuan, and -2.45 billion yuan.

The surge in performance last year seems traceable to Thalys' strategic product line layout.

Currently, the AITO brand offers three models: AITO M5, M7, and M9. In 2024, AITO launched the new M5 and new M7 series, coupled with the continued popularity of the M9, which was released in December 2023 and officially launched in February 2024, leading to a continuous increase in the company's overall sales. Official data shows that in 2024, Thalys' new energy vehicle sales reached 426,900 units, a year-on-year increase of 182.84%, achieving the goal of doubling sales. Thalys emphasized that the significant performance increase in 2024 was primarily due to the adjustment of the sales product mix, doubling of sales, and enhanced profitability.

However, Thalys' momentum has weakened since the beginning of 2025.

According to Thalys Group's March 2025 production and sales bulletin, new energy vehicle sales were 18,805 units, a year-on-year decrease of 32.19%; production was 19,355 units, a year-on-year decrease of 27.61%. Thalys Automobile sold 13,696 units in March, a year-on-year decrease of 45.19%, with production in March at 14,827 units, a year-on-year decrease of 39.13%. From January to March 2025, cumulative sales of new energy vehicles were 54,552 units, a year-on-year decrease of 42.47%; cumulative production was 56,225 units, a year-on-year decrease of 42.49%. In other words, the company's overall production and sales volume in the first quarter of this year was nearly halved compared to the same period last year.

In contrast to Thalys' decline, the domestic new energy vehicle market maintained a positive momentum in March. According to preliminary statistics from the Passenger Car Association, retail sales of passenger vehicles in China reached 1.889 million units in March 2025, an increase of 12% year-on-year and 36% month-on-month. Among them, the new energy vehicle market performed robustly, with retail sales of 988,000 units in March, an increase of 39% year-on-year and 44% month-on-month.

It is evident that Thalys' competitiveness has shown a downward trend this year.

02. Deeply Tied to Huawei, the "OEM" Label is Hard to Shake Off

When discussing Thalys' core competitiveness, the name Huawei is inseparable. In 2021, Thalys partnered with Huawei to launch the AITO brand, emerging as a "rising star" in the new auto landscape. As the first brand under Huawei's HarmonyOS Intelligent Driving, AITO has gained consumer recognition through Huawei's products, technology, brand strength, and channel capabilities.

However, with the Four Realms now assembled, Thalys is no longer Huawei's sole focus. Stockstar noted that in November 2024, the Zunjie S800, a collaboration between Huawei and JAC Motors, officially debuted with a pre-sale price of 1 to 1.5 million yuan. It is the first model of Zunjie, a million-yuan luxury brand under HarmonyOS Intelligent Driving.

Huawei's HarmonyOS Intelligent Driving has now officially assembled the Four Realms: AITO in collaboration with Thalys, Zhijie with Chery, Xiangjie with Beijing Automotive, and Zunjie with JAC Motors. This means that Huawei's influence is being shared among the other three realms. Reports indicate that the layout of exhibition stands in Huawei's offline retail stores has already changed, with models like Zhijie and Xiangjie beginning to occupy the original "C position" of AITO. Recently, Huawei's Yu Chengdong has also gradually shifted his promotional focus to other brands.

Faced with the potential loss of favor, Thalys is attempting to cling to Huawei.

Last July, Thalys planned to acquire the AITO trademark held by Huawei for 2.5 billion yuan to optimize their cooperation model. In the same month, Thalys decided to invest 11.5 billion yuan to acquire a 10% stake in Huawei's subsidiary Shenzhen Yingwang, further deepening their ties from business cooperation to equity cooperation. Recently, Thalys also announced that it has paid Huawei the second transfer price of 5.75 billion yuan. Thalys has paid nearly 14 billion yuan in cash to retain Huawei, far exceeding its 2024 net profit.

In addition, Thalys is striving for self-reliance. In March 2023, it launched a new new energy vehicle brand, BluePower Automobile. Positioned as a popularizer of smart electric vehicles, BluePower Automobile contrasts with AITO, which is targeted as a high-end smart car brand.

In March 2023, the first model of the BluePower brand, BluePower E5, was officially launched. Positioned as an electric hybrid mid-size SUV, it is equipped with BYD's Fudi electric hybrid system and offers two configurations and four models, starting at 139,900 yuan. In November 2023, BluePower Automobile introduced the BluePower E3, a pure electric compact SUV, equipped with BYD's Fudi power motor and adopting the HUAWEI HiCar in-car system. This model is available in two configurations with a price range of 139,800 to 145,800 yuan. In October 2024, the BluePower E5 PLUS was officially launched, equipped with Thalys' super electric hybrid system and HUAWEI HiCar 4.0. Five models were released with an official guide price ranging from 99,800 to 135,800 yuan.

Overall, BluePower Automobile's price range is below 150,000 yuan, and it still relies on external forces for some core technologies to support its product selling points. However, according to third-party public data, the monthly sales of BluePower Automobile's main model, BluePower E5, have hovered at the level of thousands of units, yielding unsatisfactory results.

In the short term, Thalys still needs to rely on Huawei's brand power to sustain its operations.

03. The Road to Overseas Market Expansion is Long and Arduous

It is worth mentioning that on the day the annual report was released, Thalys also announced two significant events.

First, to further enhance its comprehensive strength, Thalys Automobile, a holding subsidiary, plans to introduce strategic investors such as ICBC Investment, BOCOM Investment, and ABC Investment to jointly increase capital in Thalys Automobile in monetary terms, with a total additional capital amount not exceeding 5 billion yuan. The company has already signed relevant agreements with these investors.

The second event is the announcement of the plan to launch an IPO in Hong Kong.

From these announcements, it is clear that the company is in urgent need of substantial funds. Regarding their usage, the company stated in the prospectus that the secondary listing in Hong Kong is to explore the international market. Thalys emphasized that the issuance and listing of H shares is to further promote its global strategic layout, build an international capital operation platform, and improve its overall competitiveness. The funds raised from H shares will be allocated to new energy vehicle technology research and development, overseas market expansion, and supply chain optimization.

Recent actions also indicate Thalys' clear intention to expand overseas. Not long ago, the "AITO Mountains and Rivers - Intelligent Driving Europe Tour" fleet, composed of models such as AITO M9, new AITO M7, and new AITO M5, traveled through 12 countries and culminated in Paris for the 90th Paris International Automobile Exhibition. Additionally, Thalys plans to increase channel layout and sales outlet construction in the European market, while continuing to invest in local R&D and production facilities.

However, judging from previous sales data, the company's overseas performance is not optimistic. Public data shows that in the first eight months of last year, Thalys' overseas sales were incompletely counted at 1,785 units, with Israel being the country with the highest sales. Sales in countries such as Indonesia, Singapore, Brazil, and Spain were less than 100 units, and sales in some countries were even less than 10 units.

In terms of performance, Thalys achieved revenues of 136.812 billion yuan and 4.197 billion yuan in domestic and foreign markets, respectively, in 2024. Notably, its foreign market revenue declined by approximately 15% compared to 4.966 billion yuan in 2023.

It is evident that Thalys still needs time to build its brand power domestically and establish its reputation overseas. Moreover, Thalys will face competition from BYD and Nezha, which have rich experience in overseas expansion. For Thalys, the road to overseas expansion remains fraught with challenges. (This article was originally published on Stockstar, author | Yu Ying)

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