Changan Automobile's net profit drops 44% year-on-year, yet it still invests 14.4 billion yuan in a bold push for technological transformation.

Recently, Changan Automobile released its first annual report after the establishment of the new central enterprise: In 2025, the company sold a cumulative total of 2.913 million new vehicles, reaching a new high in the past nine years, with a year-on-year increase of 8.54%. The annual sales volume of the new energy sector was approximately 1.11 million units, a year-on-year increase of 51.10%. The overseas sales volume was approximately 637,300 units, a year-on-year increase of 18.85%.

During the year, Changan Automobile achieved an operating income of 164 billion yuan, a year-on-year increase of 2.67%. The net profit attributable to the parent company was 4.075 billion yuan, a decrease of 44.34% compared with 7.321 billion yuan in 2024. The net profit attributable to the parent company after deducting non-recurring gains was 2.795 billion yuan, a year-on-year increase of 8.03%.

At the performance briefing of Changan Automobile in 2025 held on April 13th, in response to the question of "why the company's sales are good but the profit has not been increasing", Zhu Huarong, the Party Secretary and Chairman of China Changan Automobile Group Co., Ltd., said that the company's operating quality has been steadily improving. The annual comprehensive gross profit margin reached 15.54%, a year-on-year increase of 0.6 percentage points, showing an upward trend quarter by quarter. The gross profit margin of the overseas sector was 19.49%, significantly higher than that in the domestic market, becoming an important supplement to the company's profitability.

Changan Automobile stated that by 2030, the company aims to achieve a total sales volume of 5 million units. Among them, the sales volume of its self-owned brands is planned to reach 4 million units, the sales target of intelligent new vehicles is 3 million units, and the overseas sales target is 1.5 million units, at least doubling the current sales performance. The three new energy brands under its umbrella, Avita, Deepal, and Changan Qiyuan, will build a differentiated competitive barrier for Changan Automobile, and a total of 43 new models will be launched in the next three years.

1

New Energy Sales Growth Faces Challenges

From the perspective of the profit structure, in 2025, Changan Automobile's non-recurring gains decreased from 4.734 billion yuan in 2024 to 1.28 billion yuan in 2025, a decrease of 3.454 billion yuan. Among them, the gains from the disposal of non-current assets and government subsidies decreased by more than 3.4 billion yuan in total.

In contrast, the gross profit margin of the automotive business increased by 0.6 percentage points year-on-year to 15.54%. As the one-time gains gradually withdraw, the company's dependence on asset disposal and subsidies has significantly decreased, and the hematopoietic ability of the main business has been continuously restored.

Picture/Changan Automobile Financial Report

However, due to the implementation of relevant policies to shorten the payment period for suppliers, last year, the net cash flow generated from operating activities of Changan Automobile decreased by 62.15% year-on-year to 1.836 billion yuan. The accelerated payment rhythm of the purchase price directly led to an increase in the current operating cash outflow, which in turn pulled down the net cash flow.

From the perspective of the revenue structure, the dealer model contributed 90.18% of Changan Automobile's revenue, while the revenue contribution of the direct sales model was only 4.78%, indicating that Changan Automobile still has a relatively high degree of dependence on the traditional dealer system, and there are still obvious differences in the channel model compared with new car-making forces.

From another perspective, the stability of the supply system is also to ensure the continuous growth of sales volume. During the year, the company's R & D expenses and management expenses increased by 10.02% and 2.77% year-on-year respectively, which was basically in line with the growth rhythm of new vehicle sales, while the sales expenses increased by 32.56% year-on-year. The financial report mentioned that this change was mainly due to the increase in the sales volume of new energy models, as well as the increase in the promotion of new product launches and brand publicity.

During the year, Changan Automobile completed the launch and mass production and delivery of models such as Changan Qiyuan Q07, Changan Qiyuan A06, Changan Qiyuan New Q05, Avita 06, Deepal S09, New Deepal S07, Deepal L06, CS75 PRO, Changan Mazda EZ - 60, and Changan Kaicheng V919. It also launched upgraded products such as the third - generation Eado and Eado PHEV, CS55 PLUS and CS55 PLUS PHEV, and the second - generation UNI - V.

In terms of market performance, the Changan brand sold 919,700 new vehicles. The Eado series and the Changan CS75 series achieved sales of 210,600 and 217,500 units respectively, stabilizing the basic market of the fuel vehicle market. The three new energy brands, Avita, Deepal, and Changan Qiyuan, sold 123,500, 325,100, and 410,500 new vehicles respectively, with year-on-year increases of 67.7%, 44.4%, and 42.6% respectively.

In 2026, Changan Automobile plans to launch more than 10 new and facelifted products, including new energy models such as Changan Qiyuan Q06, New Deepal S05, and Avita 06T, as well as fuel models such as the refreshed CS75 PLUS, CS55 PLUS, and Eado. In addition, Avita will launch the first strategic model of its second - generation products, which is positioned as a new flagship six - seat SUV and will help the brand expand the mid - to - high - end family market.

Facing the strong competition from brands such as Leapmotor, Hongmeng Zhixing, "NIO, XPeng, Li Auto", Xiaomi Automobile, and Zeekr, whether the new energy models under Changan Automobile can gain market recognition and convert product investment into real sales will be a key test for the company in the future.

2

Invest 14.47 Billion This Year to Transform into a Technology Company

At the High - level Forum on the Development of Intelligent Electric Vehicles (2026) held on April 11th, Zhao Fei, the General Manager of China Changan Automobile Group, mentioned that currently, the automotive industry has fully shifted from single - product competition to ecological value competition. "We must break out of the traditional thinking of vehicle manufacturing and build a large industrial ecosystem of cross - border integration and collaborative symbiosis with an open and inclusive attitude."

Currently, many automobile companies have entered the field of embodied intelligence, which is also one of the important directions of the automotive ecological competition.

In 2025, Changan Automobile completed the development and verification of the prototype of the automotive ecological robot, registered a joint - venture company for flying cars, obtained the first - batch access permission for L3 - level autonomous driving products, and also developed the prototype platform for in - vehicle optical communication and the prototype vehicle for the star - flash digital key. The relevant technological achievements are waiting for further commercialization. Zhao Fei introduced at the performance briefing that the company will conduct the verification of the Changan Golden Bell Solid - State Battery equipped with a robot and vehicle installation before the third quarter of this year.

Changan Automobile's "openness" is also reflected in its overseas layout.

As one of the Chinese automobile companies that started globalization earlier, Changan Automobile's layout direction has gradually extended from simple vehicle exports to the construction of overseas service systems. In 2025, its first overseas new energy vehicle factory in Rayong, Thailand, was officially put into production, and a technical maintenance system was piloted locally in an attempt to improve the short - board of after - sales maintenance that is common among Chinese brands going global. In addition, Changan Automobile has also opened offline stores in markets such as Norway, Portugal, Greece, and Serbia, and cooperated with the European dealer group Emil Frey to build a sales and service network in the Netherlands. Zhao Fei said that Changan Automobile's overseas layout should be "local, for the local, and not engage in short - term speculation."

Reflected in the financial indicators, in 2025, the gross profit margin of Changan Automobile in the overseas market reached 19.49%, higher than the 14.54% gross profit margin in the domestic market.

According to the plan, this year, multiple products such as the fourth - generation Eado, Changan Qiyuan New Q05, Deepal S09, and Avita 06 will be launched in various overseas regions, covering markets in Europe, Southeast Asia, the Middle East, Africa, and Central and South America. In the next three years, Changan Automobile will launch a total of 26 new models and plans to cover the world's major markets before 2030.

To achieve the company's strategic goals, Changan Automobile plans to invest 14.47 billion yuan in 2026. Among them, 4.47 billion yuan is for fixed - asset investment, mainly used to strengthen core R & D capabilities, continuously adjust the new energy product and production capacity structure, and expand overseas business. The other 10 billion yuan is for long - term equity investment, which will be mainly invested in the construction of intelligent basic capabilities, the development of new energy brands, the establishment of overseas investment platforms, and used to expand the layout of emerging industries such as flying cars and robots, promoting the company's transformation into a technology company.

This article is from the WeChat official account "Phoenix WEEKLY Auto", author: Zhao Yu, editor: Hao Lin. Republished by 36Kr with permission.