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FAW Jiefang Group Co., Ltd. 2024 Semi-Annual Report Summary

Core Content Overview

This document presents the semi-annual report of FAW Jiefang Group Co., Ltd. for the period January 1, 2024 - June 30, 2024. It outlines the company's main financial indicators, business operations, core competitiveness, and key strategies. The report also includes definitions of terms, non-recurring profit and loss items, and important notes regarding the authenticity and accuracy of the financial statements.

Main Financial Indicators

Key Business Operations

I. Main Businesses

• FAW Jiefang is a commercial vehicle manufacturer, producing heavy, medium, and light trucks, buses, and core components (engines, transmissions, axles).
• The company has a complete manufacturing system covering raw materials, core components, key large assemblies, and complete vehicles.
• Products are used in various market segments, including traction, cargo carrying, dumping, special purposes, highway passenger transport, and bus passenger transport.
• The company provides standardized and customized commercial vehicle products.

II. Industry Overview

• In the first half of 2024, the macroeconomic growth resumed, with a GDP growth rate of 5%.
• The freight environment remained stable, with a 4% increase in road freight turnover.
• Medium and heavy truck demand reached 571,000 units, up 4.4% year-on-year.
• FAW Jiefang sold 123,000 units, up 9.4%, accounting for 21.5% of the market.
• Natural gas type medium and heavy trucks continued their high growth trend, with 104.2% increase in industry demand.
• FAW Jiefang sold 35,000 units, maintaining a leading position in the natural gas market.
• New energy type medium and heavy trucks had an industry demand of 29,000 units, up 136.7%.
• FAW Jiefang sold 2,000 units, up 260%, showing leapfrog growth.

III. Operational Highlights

• Total vehicle sales reached 149,100 units, up 13.4%.
• Medium and heavy trucks sales: 122,900 units, up 9.4%.
• Light trucks sales: 26,200 units, up 43.0%.
• New energy vehicles sales: 8,500 units, up 139.8%.
• Overseas exports reached 35,500 units, up 37.2%, hitting a record high.

Core Competitiveness

FAW Jiefang has established a strong and complete independent R&D system in China, covering foresight technology, engine, transmission, axle, and complete vehicle. It has formed an efficient and collaborative R&D team of over 3,000 people.

1. Product R&D

• The company has developed eight major product platforms for heavy trucks: J7, J6P, J6V, J6E, Yingtu, JH6, JH5, and Han V2.0.
• Four major product platforms for medium trucks: J6G, J6L, JK6, Dragon V.
• Four major product platforms for light trucks: Lingtu, Tiger 6G, J6F, Tiger V.
• Passenger vehicles include road vehicles, new energy buses, and recreational vehicles.
• New energy products have achieved full coverage of mainstream market scenarios.

2. Marketing and Procurement

• The company has built a comprehensive marketing service system.
• It operates through three sales companies (Changchun, Qingdao, and Light Trucks), with nearly 1,000 dealers, over 1,800 service providers, over 80 spare parts centers, and over 200 spare parts dealers.
• The service coverage reaches more than 230 prefecture-level cities, with a 97.5% coverage rate in cities with a capacity of over 1,000 vehicles.
• The national average service radius is 48 kilometers, at the leading level in the industry.

3. Production and Manufacturing

• The company has five complete vehicle bases in Changchun, Qingdao, Guanghan, Liuzhou, and Foshan.
• It has three assembly bases in Changchun, Wuxi, and Dalian.
• The Wuxi Diesel Engine Factory has achieved world-class manufacturing level.
• The company has established six new business bases in Suzhou, Nanjing, Tianjin, Shijiazhuang, Foshan, and Wuxi, based on commercial intelligent vehicles, post-market services, connected services, new energy business model operations, and fuel cell power systems.

4. Overseas Exports

• The company actively responds to the "Belt and Road" initiative.
• It has established strategic partnerships with global enterprises such as Huawei, Knorr-Bremse, ZF, Shell, Volkswagen, China Unicom, JD, and PlusAI.

Important Notes

• The Board of Directors and senior executives guarantee the authenticity, accuracy, and completeness of the report.
• The Company's legal representative is Wu Bilei.
• The semi-annual report includes prospective statements, which do not constitute commitments to investors.
• The Company has not paid cash dividends or bonus shares in the reporting period.
• Information disclosure is conducted through China Securities Journal, Securities Times, and CNINFO.
• Non-recurring profit and loss items include disposal of non-current assets, government subsidies, reversal of impairment provisions, and other non-operating income and expenses.
• The total non-recurring profit and loss amounted to CNY 194,376,046.55.

Summary of Key Strategies and Achievements

• The company has solidified its market leadership in both traditional and new energy vehicles.
• It has implemented strategic reforms, technological innovation, and resource optimization.
• The "Year of Capability Enhancement" and management and personnel system reforms have been deeply promoted.
• The company has made significant progress in refinancing projects and capital operations.
• It has maintained a top market value in A-share commercial vehicles.
• The brand value exceeded CNY 131.8 billion, ranking first in the industry for 13 consecutive years.

Risk and Future Outlook

• The Company has described possible risks and countermeasures in the Management Discussion and Analysis section.
• The freight market remains stable but with low profitability.
• Natural gas and new energy vehicles continue to drive growth.
• The Company is committed to becoming a "China's first and world-class" provider of green and intelligent transportation solutions.
• It aims to sprint towards the 14th Five-Year Plan with stronger fighting spirit, more motivation, and better results.