Huawei’s Carmaker Partner Seres Lost USD2,296 on Each Car Sold in First Nine Months
Xu Yu
DATE:  Oct 30 2023
/ SOURCE:  Yicai
Huawei’s Carmaker Partner Seres Lost USD2,296 on Each Car Sold in First Nine Months Huawei’s Carmaker Partner Seres Lost USD2,296 on Each Car Sold in First Nine Months

(Yicai) Oct. 30 -- Seres Group, the car-making partner of Chinese telecoms giant Huawei Technologies, lost an average of CNY16,800 (USD2,296) on every vehicle it sold in the first three quarters of the year based on the firm’s lower sales and revenue figures.

Seres' net loss narrowed 14 percent to CNY2.3 billion (USD314.3 million) in the nine months ended Sept. 30 from a year earlier, the Chongqing-based company said in an earnings report released on Oct. 27. Revenue fell 28 percent to CNY16.7 billion (USD2.3 billion) in the period, with third-quarter income plunging 47 percent to CNY5.6 billion.

According to data the carmaker released earlier this month, sales fell 31 percent to 136,786 vehicles in the first nine months. Based on this and its earnings figures, Seres lost CNY16,800 on each car sold in the period versus about CNY14,600 in the first half.

But the cost pressure that has plagued Seres since it partnered with Huawei  eased. Sales expenses fell 13.4 percent to CNY2.7 billion in the first nine months, while research and development costs jumped 20 percent to CNY1.1 billion.

Seres and Huawei jointly developed the electric vehicle brand Aito, with the Shenzhen-based tech giant mainly providing the smart driving suite, vehicle design, and sales channels while the automaker handles production.

Seres launched the Aito M7 on Sept. 12 and expects much higher revenue thanks to deliveries of the new product, it noted. The Aito M9, its new sports utility vehicle model, will likely debut in December.

The M7 series has sold like hotcakes after its launch, with orders exceeding 60,000 units within the first month, said Yu Chengdong, chief executive of Huawei's smart car division. 

Shares of Seres [SHA: 601127] rose 3.8 percent to close at CNY82.81 (USD11.32) in Shanghai today, after jumping by as much as 5.8 percent in the morning. The stock has more than doubled in value since Aug. 25, boosted by Aito sales expectations.

Editors: Dou Shicong, Martin Kadiev

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Keywords:   Seres Group,Huawei Technologies,AITO