- 2024-07-18
- News
GAC Aion's New Move: Can It Revive Sales?
As more and more car models are priced below 200,000 yuan, Aion's advantage of high cost-performance is diminishing. When all car companies launch high-level intelligent driving, GAC Aion is also looking for new product selling points for itself.
On October 15, GAC Aion and domestic autonomous driving company Momenta signed a strategic cooperation agreement, and the two parties will promote the research and development and mass production of high-level intelligent driving solutions.
As a self-owned brand focused on by GAC Group, Aion bears the heavy responsibility of GAC Group's transformation in the field of intelligent electric vehicles, and it is also a new growth point in sales that GAC Group wants to create.
However, facing the current situation where more and more brands are launching new cars priced below 200,000 yuan, the market competition where GAC Aion is located has begun to intensify. Especially this year, new car forces led by NIO and XPeng, as well as new brands incubated by traditional car companies such as Zhiji and AITO, have not only achieved a price drop in car models, but have also brought the competition from driving and cabin areas to the field of intelligent driving.
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GAC Aion, which has always emphasized battery safety and long endurance, must rely on external forces to cope with the challenges brought by intelligence. Momenta, which has successfully helped Zhiji boost sales, has become the first choice for GAC Aion.
Xi Zhongmin, deputy general manager of GAC Aion, said that Momenta, as a leader in the field of intelligent driving technology, has always been an important partner of GAC Aion. Cooperation with Momenta will accelerate the mass production and popularization of intelligent driving and urban NDA technologies.
Behind the word "popularization" is actually Aion's desire for sales.
GAC's sales achievement rate in the first three quarters is less than half.The price war in 2024 has put many automakers in a dilemma—high prices lead to unsold vehicles; low prices damage profits.
Looking at the semi-annual report for 2024, GAC Group's revenue for the first half of the year was 45.808 billion yuan, a year-on-year decrease of 25.62%; the net profit attributable to the listed company was 1.516 billion yuan, a year-on-year decrease of 48.88%. The net profit excluding non-recurring gains and losses fell significantly, with a year-on-year decrease of 112.51%.
The latest production and sales situation is also not optimistic. According to the September production and sales flash report released by GAC Group, the production in September was 161,000 vehicles, a year-on-year decrease of 33.43%; sales were 182,600 vehicles, a year-on-year decrease of 25.03%. In the first three quarters, GAC Group's production decreased by 26.08% year-on-year, and sales decreased by 25.59% year-on-year. In the first three quarters, GAC Group sold a total of 1.3351 million new vehicles, only achieving 48% of the annual sales target.
Looking at the brands, in the 2024 price war, both GAC Honda and GAC Toyota have taken price reduction measures, and sales have not improved. GAC Honda's sales in the first three quarters decreased by 29.06% year-on-year; GAC Toyota's sales in the first three quarters decreased by 24.49% year-on-year.
In terms of independent brands, GAC Trumpchi's production in the first three quarters increased by 0.67% year-on-year, while sales decreased by 6.41% year-on-year; GAC Aion's production decreased by 36.8% year-on-year, and sales decreased by 35.4% year-on-year.
The decline in joint venture brand sales is a common phenomenon in the industry, but the failure of independent brands to take over the sales baton is a major pain point for GAC Group.
Previously, GAC Aion was known for its high cost-performance ratio in the 200,000 yuan market. Due to its simultaneous efforts in the ride-hailing market, sales maintained high growth, for example, in 2023, GAC Aion sold 480,000 vehicles, a year-on-year increase of 77.02%.
However, as more and more automakers enter the market below 200,000 yuan, Aion's basic market faces competition; coupled with the lack of substantial progress in sales for the high-end brand Haobo launched earlier, Aion is under pressure from both sides.
High-level intelligent driving on vehicles has become a new breakthrough point for independent brand sales.
Aion has its own way to cope with pressure—introducing high-value technology to enhance product strength.Previously, the short range and spontaneous combustion of electric vehicles were pain points in their promotion. GAC Aion, in collaboration with subsidiaries of GAC Group, invested 10.9 billion yuan to jointly establish Yinpai Battery Technology Co., Ltd. In 2023, the battery factory was completed and the first self-developed battery was rolled off the production line.
Nowadays, more and more car manufacturers are beginning to develop their own battery integration technologies, effectively achieving cost reduction and efficiency enhancement. Especially BYD, which ranks first in domestic new energy vehicle sales, continues to leverage the advantages of vertical integration to lower prices, impacting new energy vehicles like GAC Aion that target the mass market.
Moreover, this year's car sales focus has shifted from electrification to intelligence, especially with BYD accelerating its intelligent driving layout, which further increases the competitive pressure on GAC Aion.
Therefore, accelerating the layout of intelligent driving is an urgent matter. Momenta, as an intelligent driving supplier for BYD and soon to be the end-to-end driverless car model for GAC Toyota, provides GAC Aion with a new handle.
Industry experts believe that the cooperation between Aion and Momenta is a good way to make up for the shortcomings in intelligent driving and enhance their own competitiveness.
At present, the cost of intelligent driving hardware and technology is decreasing. Momenta CEO Cao Xudong said that by the end of 2025 to the beginning of 2026, the cost of advanced intelligent driving is expected to drop to around 500 yuan. At that time, models priced above 200,000 yuan may come standard with urban intelligent driving, while models above 150,000 yuan will come standard or optional with the technology.
Therefore, Aion, which wants to regain sales, must accelerate the layout of intelligent driving this year to cope with the competition in the field of intelligent electric vehicles in the next two years.
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