The monthly sales of new cars fail to reach 10,000 units, and joint ventures are losing money. Can the self-owned brands of this long-established Guangzhou automaker break through the encirclement by "horse racing"?

Image source: Du Ge

On June 20th, Feng Xingya, the Chairman and General Manager of GAC Group (601238.SH), responded to multiple hot topics such as GAC Group's reform.

In order to enhance product competitiveness, GAC will implement a horse - racing mechanism in its self - owned brands. However, resources will not be evenly distributed but tilted strategically. Feng Xingya said, "In areas where competition is needed, it must be carried out, and in businesses that need to be integrated, integration must be done." Specifically, in re - engineering the product development process, GAC introduced IPD and used it for product definition, separating product development from technical research. Under this model, GAC set up product general managers, allowing them to form teams to participate in the "horse - racing". The assessment mechanism has also changed from the traditional position - based assessment in enterprises to project - led assessment.

In November 2024, GAC Group launched the three - year "Panyu Action", transforming the strategic control of self - owned brands into operational control. Currently, the results have not yet emerged. In the first five months of 2025, GAC Trumpchi sold 177,500 vehicles, a year - on - year decrease of 24.76%; GAC Aion sold 88,800 vehicles, a year - on - year decrease of 11.77%.

Can GAC Group, which has launched the horse - racing mechanism for its self - owned brands, boost its sales?

Monthly average sales of new cars have not exceeded 10,000

According to the "Panyu Action" plan, in the next three years, GAC's self - owned brand business segment will intensively launch 22 new models. Among them, 7 models will be launched in 2025, comprehensively covering mainstream new - energy power technology routes such as pure - electric, range - extended, and plug - in hybrid. By 2027, the sales volume of self - owned brands will reach 2 million vehicles, accounting for more than 60% of the group's total sales.

In 2024, GAC Trumpchi and GAC Aion sold 414,600 and 374,900 vehicles respectively, accounting for 39.41% of GAC Group's total vehicle sales. In the first five months of 2025, GAC Trumpchi and GAC Aion sold 177,500 and 88,800 vehicles respectively, accounting for 34.08% of GAC Group's total vehicle sales.

Obviously, since 2025, the sales contribution of self - owned brands to GAC Group has declined, which is related to the poor performance of new models.

In January 2025, GAC Aion launched the first model of the "Panyu Action", the Aion UT, which is positioned as a small pure - electric two - door sedan. In February, the Aion UT was officially launched, with a total of 5 models launched, and the price range is from 69,800 yuan to 101,800 yuan. The performance of the Aion UT after its launch is not outstanding. Data shows that in March 2025, the sales volume of the Aion UT was 4,980 vehicles, dropping to 4,337 vehicles the next month, and only 3,724 vehicles in May.

Comparing with competitors, Geely Xingyuan, which was launched in October 2024 with a price range of 69,800 yuan to 98,800 yuan, achieved a total sales volume of 164,000 vehicles in the first five months of 2025; BYD Seagull sold 144,200 vehicles; Wuling Bingo also sold 65,400 vehicles, with the monthly average sales exceeding 10,000 vehicles.

According to media reports, when many consumers inquired about the low - end models of the Aion UT, sales staff said that there was no inventory or production plan for low - end models and suggested that consumers choose mid - to high - end versions. This may be the reason for the monthly decline in the sales volume of the Aion UT.

Another self - owned brand, GAC Trumpchi, launched the Trumpchi Xiangwang series. Based on the new multi - energy platform architecture, it created a new high - end product series equipped with cutting - edge technologies such as combined assisted driving and AI intelligent cockpit. At the end of March 2025, the first model of the Trumpchi Xiangwang series, the Xiangwang S7, was launched, with a limited - time launch price of 169,800 - 223,800 yuan. In April, its sales volume was 2,977 vehicles, dropping to 1,124 vehicles in May.

In May, the Trumpchi Xiangwang M8 was launched. It is the first new car of the GAC - Huawei joint "Innovation" plan, equipped with Huawei's Qiankun Intelligent Driving System and Hongmeng Cockpit, with a price range of 359,900 - 409,900 yuan. With the poor sales performance of the Trumpchi Xiangwang S7, whether Huawei can boost the sales of the Trumpchi Xiangwang M8 is also worthy of attention.

With the continuous decline in the sales volume of new cars of GAC Aion and GAC Trumpchi, the new cars of Hyper also face great pressure. At the beginning of 2025, GAC Group announced that Hyper, originally a high - end series, would be separated from Aion and become one of the three major self - owned brands of GAC Group. In April 2025, the GAC Hyper HL was launched, with a starting price of 269,800 yuan, targeting the new intelligent luxury family SUV market. Data shows that its sales volume in April and May was 303 and 618 vehicles respectively.

However, in the market for pure - electric six - seat SUVs priced over 300,000 yuan, the Hyper HL has firmly ranked second in sales, only after the Wenjie M9.

The effectiveness of the reform has not yet emerged

Judging from the current declining sales volume, GAC Group needs to accelerate the layout of its self - owned brands. The joint - venture brands, which were once cash cows, have seen continuous decline in sales and can no longer support the performance.

In 2024, GAC Toyota sold 470,600 vehicles, a year - on - year decrease of 26.52%; GAC Honda sold 738,000 vehicles, a year - on - year decrease of 22.32%. GAC Honda's sales revenue was 68.25 billion yuan, a year - on - year decrease of 27.03%, and its contributed dividends were 1.193 billion yuan, a year - on - year decrease of 65.94%. GAC Toyota's sales revenue was 109.545 billion yuan, a year - on - year decrease of 28.34%, and its contributed dividends were 8.859 billion yuan, a year - on - year decrease of 11.23%. In this year, GAC Group's overall revenue was 106.798 billion yuan, a year - on - year decrease of 17.5%; the net profit attributable to shareholders of the listed company was 824 million yuan, a year - on - year decrease of 81.4%.

In the first five months of 2025, GAC Honda sold 124,600 vehicles, a year - on - year decrease of 28.2%; GAC Toyota sold 273,600 vehicles, a year - on - year increase of 2.88%.

Since joint - venture brands can no longer bring growth, GAC Group's reform of self - owned brands continues.

At the 2024 performance briefing held in April, GAC Group said that in terms of internal reform, it had initially completed the operational control of the core areas of R & D, production, supply, and sales of self - owned brands, integrating the former GAC Trumpchi, GAC Aion, and GAC Research Institute, and establishing four headquarters: Product Headquarters, Financial Headquarters, Procurement Headquarters, and Brand Marketing Headquarters. The integration of other areas will also be completed soon. In terms of products, GAC Group introduced the IPD integrated product development process, aiming to shorten the product development cycle to 18 - 20 months. In terms of cost control, GAC Group unified the procurement of self - owned brand parts, and it is expected that the cost of self - owned brands will be reduced by about 10% in 2025. In terms of finance, GAC Group integrated and established the Financial Headquarters and implemented the product line assessment mechanism.

Data shows that the IPD process is a product development model that is customer - demand - oriented and cross - departmental collaborative. It emphasizes the standardization of the entire product development process, including market analysis, product planning, R & D, testing, production, marketing, and other links, to improve the efficiency and quality of product development.

On June 20th, GAC Group held a small - scale media communication meeting. Feng Xingya, the Chairman and General Manager of GAC Group, said that since the launch of the three - year "Panyu Action", GAC Group has mainly done four things: building an operational headquarters, implementing integrated operations of self - owned brands, introducing IPD to re - engineer the product development process system, and promoting cadre and personnel reform.

Among them, in building an operational headquarters, GAC directly manages strategies, resources, talents, and assessments at the group level, and focuses on allocating resources and energy to self - owned brands at the group level.

In promoting cadre and personnel reform, GAC Group will introduce outstanding talents through internal competition and external recruitment. According to media reports, at the end of March, GAC Group publicly recruited for multiple important positions globally, including the Chief Marketing Officer (CMO), General Manager of Huawang Automobile, General Manager of GAC Capital, and General Manager of GAC Auto Finance. Feng Xingya said that public recruitment can select talents who can meet the requirements of the new era and development needs. GAC Group will retain this system to form a new employment orientation and method for the group. Internally, GAC has also launched an open selection mechanism of "competing for positions" for middle - level and above leading cadres, allowing the capable to take on positions.

In addition, Feng Xingya pointed out that the horse - racing mechanism will definitely be implemented, but resources will be tilted towards strategic priorities and not evenly distributed. GAC will continuously inject high - quality resources into GAC Aion, including Hyper, and will spare no effort to build the Hyper brand. Next, Aion plans to create a new category for taxis (B - end), with Aion focusing on the C - end, and Hyper positioning as a high - end brand in the new - energy vehicle market.

At the same time, Feng Xingya revealed that Huawang Automobile recently launched recruitment for society and universities, covering multiple fields such as R & D, products, sales and service, marketing, and finance. Huawang Automobile will create innovative products targeting the high - end market at the 300,000 - yuan level. Currently, the company is steadily promoting team building and product R & D, and the first model is expected to be launched in 2026.

Judging from the sales volume, the reform effect of self - owned brands has not yet emerged. In the first five months of 2025, GAC Trumpchi sold 177,500 vehicles, a year - on - year decrease of 24.76%; GAC Aion sold 88,800 vehicles, a year - on - year decrease of 11.77%.

Under the double pressure of current sales and performance decline, GAC Group has focused on self - owned brands. However, half a year has passed since the launch of the Panyu Action, and the new models launched by GAC Group's self - owned brands have not boosted sales. After the internal "horse - racing", can GAC Group's self - owned brands regain their vitality?

This article is from the WeChat official account "Visibility in the Auto Circle", author: Du Ge, published by 36Kr with authorization.