JAC Group disclosed its 2024 mid-year financial results. During the first half of the year, JAC achieved a net profit of 300.83 million yuan (40 million USD) from its subsidiaries, representing a 93.84% increase from last year.
According to previously released production and sales reports, the company sold 206,200 vehicles. Sales of JAC new energy passenger vehicles increased by 15.28% year-over-year.
JAC Group history
JAC Group (or JiangHuai Automobile Group), based in Hefei, was established in 1964 and celebrated its 60th anniversary this year. The company historically produced commercial trucks and started producing passenger vehicles in 2007.
More recently, the company is known for manufacturing the first models of Nio cars. JAC manufactured Nio’s first mass produced model, the Nio ES8, and subsequent models like the ES6, ES7, and ET7.
JAC’s time as an OEM for Nio ended in December 2023 when Nio acquired JAC factories manufacturing Nio vehicles, all in Hefei, for 3.158 billion yuan (440 million USD). Soon after, JAC announced a cooperation agreement with Huawei and plans to develop vehicles based on Huawei’s HIMA platform.
Recent success
JAC reported a significant increase in new energy research and development in the first half of 2024. Total investment grew by 59.75% year-over-year with R&D investments accounting for 7.74% of the company’s operating revenue. R&D investment is expected to increase in the future to around 9%.
Research investments have paid off as JAC has achieved mass production of L2 level intelligence driving for its cars. The company claims to have completed L3 level of automation and is looking to obtain a test license. JAC has also begun L4 level demos and testing internally in specific scenarios.
The group’s successful mid-year is partially due to its exports. JAC has exported its pickup truck line-up to over 132 countries. In 2023, JAC sold 55,000 pickup trucks with around 42,000 being exported. Popular markets include Latin America, the Gulf states, Central Asia, and Australia. The company saw a total increase of 11.3% in pickup truck sales so far this year.
JAC and Huawei
JAC has struggled in the passenger vehicle space in the past, but the company is looking to change that with its collaboration with Huawei. After first signing a cooperation agreement with Huawei in December 2023, it has been revealed in 2024 that JAC will join as the fourth member of Huawei’s HIMA auto alliance.
The JAC and HIMA joint brand is named Maextro (尊界 – Zunjie) and will compete against ultra-luxury models such as Maybach and Rolls-Royce. The brand’s first model is expected to be an MPV costing at around one million yuan (140,000 USD) based on JAC’s new energy platform called the X6. The platform will also cover sedans, SUVs, MPVs, and sport cars.
The group has mostly completed the new 200,000 annual production facility for producing JAC-Huawei models. The first model is planned to roll off the production line at the end of this year and launched in the first half of next year.
JAC looks to be changing its strategy, moving back to focusing on manufacturing their own passenger vehicles after divesting their Nio factories. Huawei’s HIMA alliance brands have been a success story so far, but it remains to be seen if JAC and Huawei’s ambition for an ultra-luxury brand will resonate with Chinese consumers.
Sources: Yiche, Economic Information Daily
