GAC, where should we go? 1 Net profit fell 97% year-on-year. Guangzhou Automobile Group (601238.SH) handed over an "amazing" third quarter report. The financial report shows that in the first three quarters of this year, GAC Group’s revenue was 74.04 billion yuan, a year-on-year

entertainment 5367℃

GAC, where should we go? 1 Net profit fell 97% year-on-year. Guangzhou Automobile Group (601238.SH) handed over an 'amazing' third quarter report. The financial report shows that in the first three quarters of this year, GAC Group’s revenue was 74.04 billion yuan, a year-on-year  - Lujuba

GAC, where should we go?

Net profit fell 97% year-on-year

Guangzhou Automobile Group (601238.sh) handed over an "amazing" third quarter report.

The financial report shows that in the first three quarters of this year, GAC Group’s revenue was 74.04 billion yuan, a year-on-year decrease of 24.18%; net profit attributable to the parent company was only 120 million yuan, a year-on-year decrease of 97.34%; net loss after deducting non-recurring gains and losses 18.7 billion, a year-on-year decrease of 146.49%; the net cash flow generated from operating activities was approximately 980 million yuan, a year-on-year decrease of 75.56%.

Looking at the third quarter alone, the company's revenue was 28.233 billion yuan, a year-on-year decrease of 21.73%; net profit loss was 1.396 billion yuan, a year-on-year decrease of 190.40%!

Is it because the entire automobile industry is not doing well, leading to the collapse of GAC Group's performance?

Let’s take a look at the performance of other car companies. The same is the third quarterly report:

BYD revenue was 502.251 billion, a year-on-year increase of 18.94%, and net profit was 25.238 billion, a year-on-year increase of 18.12%.

Great Wall Motors revenue was 142.254 billion, a year-on-year increase of 19.04%, and net profit was 10.428 billion, a year-on-year increase of 108.78%.

Cyrus operating income was 106.627 billion, a year-on-year increase of 539.24%, and net profit was 4.038 billion, a year-on-year increase of 276%.

GAC, where should we go? 1 Net profit fell 97% year-on-year. Guangzhou Automobile Group (601238.SH) handed over an 'amazing' third quarter report. The financial report shows that in the first three quarters of this year, GAC Group’s revenue was 74.04 billion yuan, a year-on-year  - Lujuba

Among the leading car companies, except for the "suffering brothers" SAIC and GAC, the other growth rates are quite strong.

Compare yourself again. Since entering 2024, stalling has become a keyword for GAC. In the first half of the year, GAC Group's revenue and net profit have both declined. This is also the first time that GAC Group has faced such a dilemma since it entered the Fortune Global 500 for eleven consecutive years.

GAC, where should we go? 1 Net profit fell 97% year-on-year. Guangzhou Automobile Group (601238.SH) handed over an 'amazing' third quarter report. The financial report shows that in the first three quarters of this year, GAC Group’s revenue was 74.04 billion yuan, a year-on-year  - Lujuba

The trend is also reflected in the capital market. As of the close of trading on November 11, 2024, Guangzhou Automobile Group's stock price was 8.82 yuan per share, , which had fallen 56% from the previous high, and had been cut in half.

In terms of market value, according to data from Yiniu.com, the historical market value of Guangzhou Automobile Group was once as high as 210 billion, has now evaporated nearly 120 billion.

GAC, where should we go? 1 Net profit fell 97% year-on-year. Guangzhou Automobile Group (601238.SH) handed over an 'amazing' third quarter report. The financial report shows that in the first three quarters of this year, GAC Group’s revenue was 74.04 billion yuan, a year-on-year  - Lujuba

Behind the fluctuations in data is strategic choice.
Judging from the timeline, Tesla entered China in 2012, NIO was established in 2014, Xpeng was established in 2014, and Ideal was established in 2015. BYD was earlier, launching its first new energy vehicle f3dm in 2008.
It will be 2017 when GAC starts to get involved in new energy vehicles, that is, it will establish " GAC Aian ". It can be said that GAC’s new energy layout is indeed a bit slow.
Of course, we can’t blame GAC for being “slow”. As a large state-controlled enterprise, GAC's decision-making must consider many factors and consult with multiple competent authorities. It is very prudent to make strategic layouts.
But many times, the situation waits for no one.
data shows that in 2017, the year when GAC Aion was established, China’s new energy vehicle market accounted for only 2.7%. But by 2023, China's new energy vehicle market share has reached 31.6%. In just 6 years, it has grown 11 times!
The territory of new energy vehicles continues to expand. Data released by the China Automobile Association shows that in October this year, the production and sales of new energy vehicles were 1.463 million and 1.43 million respectively, a year-on-year increase of 48% and 49.6% respectively. The sales of new energy vehicles accounted for 46.8% of the total sales of new automobiles.
It’s not that GAC doesn’t work hard, it’s because the potential of new energy is too strong!

Cars are not easy to sell, and the headquarters moved to the "countryside"

Handing over such a report card, what exactly has GAC Group experienced?

Let’s first look at GAC Group’s own explanation:

Mainly due to multiple factors such as the year-on-year decline in automobile sales during the period, increased business and government investment, declining profits, optimization of redundant production capacity by joint ventures, and increased exchange losses caused by exchange rate changes.

This statement seems relatively abstract. Let’s summarize the key points: Few cars are sold.

Starting from January this year, GAC’s sales have declined year-on-year for nine consecutive months. In the first three quarters of this year, GAC Group sold approximately 1.335 million new cars, a year-on-year decrease of 25.59%.

According to media estimates, the sales target that GAC Group hopes to achieve this year is 2.7555 million vehicles. In other words:

In the first three quarters of this year, GAC Group only completed about 48% of its annual sales target.

Specifically, in the first three quarters, the joint venture brand:

Guangqi Honda sold 309,000 units, a year-on-year decrease of 29.06%.

GAC Toyota sold 518,000 units, a year-on-year decrease of 24.49%.

Own brand:

GAC Trumpchi sold 277,000 units, a year-on-year decrease of 6.41%.

GAC Aian sold 227,000 units, a year-on-year decrease of 35.4%.

GAC, where should we go? 1 Net profit fell 97% year-on-year. Guangzhou Automobile Group (601238.SH) handed over an 'amazing' third quarter report. The financial report shows that in the first three quarters of this year, GAC Group’s revenue was 74.04 billion yuan, a year-on-year  - Lujuba

It can be seen that the joint venture brand is still the sales pillar of GAC Group, accounting for more than 60%. In other words, whether it is a joint venture brand as a pillar or an independent brand with high hopes, sales are declining sharply. It’s no wonder that GAC’s performance cannot be sustained.

GAC Group has actually sensed this situation for a long time.

For example, in the middle of last year, GAC Toyota started a large-scale layoff in the Chinese market, with more than a thousand employees. Subsequently, Guangqi Honda also revealed news of layoffs. The cumulative scale of the two layoffs accounted for approximately 20% of its employees in the Chinese market.

GAC, where should we go? 1 Net profit fell 97% year-on-year. Guangzhou Automobile Group (601238.SH) handed over an 'amazing' third quarter report. The financial report shows that in the first three quarters of this year, GAC Group’s revenue was 74.04 billion yuan, a year-on-year  - Lujuba

At the same time, Honda has announced the closure of two production lines in China, including Guangqi Honda's production line with an annual output of 50,000 vehicles.

A more intuitive action is that not long ago, the headquarters office address of GAC Group was moved from Zhujiang New City CBD to Panyu District, Guangzhou City. This was interpreted by the outside world as:

The GAC headquarters moved from Zhujiang New City to the countryside of Panyu.

GAC, where should we go? 1 Net profit fell 97% year-on-year. Guangzhou Automobile Group (601238.SH) handed over an 'amazing' third quarter report. The financial report shows that in the first three quarters of this year, GAC Group’s revenue was 74.04 billion yuan, a year-on-year  - Lujuba

News of the relocation of the GAC Group headquarters has actually been circulating for a long time. In October, GAC Group released the "Proposal on the Reform of Management Model and Organizational Structure", which stated bluntly that it would implement relevant organizational reforms to further reduce operating costs and improve management efficiency.

The relocation of the headquarters is part of "cost reduction and efficiency improvement". According to GAC Group, the purpose of the relocation:

is to promote the concentration of all elements to front-line practices.

This is true. In recent years, GAC’s core management has indeed been too far away from the front line.

This "away" is highlighted in positioning. When mentioning GAC Aian, many people will think of one word: , the king of online ride-hailing.

According to data from the Passenger Car Association, of the approximately 850,000 new online ride-hailing vehicles in 2023, GAC Aian contributed 220,000, accounting for 45% of its total sales. As the online ride-hailing market becomes saturated, GAC Aian must find a new way out.

But looking at the GAC Aian on the streets, let me ask, how many people, especially young people, would choose to buy a "same model as an online car-hailing car"?

This is a problem with "positioning". Looking at other new energy car companies, NIO focuses on services and battery swaps, Ideal focuses on family cars, Xpeng focuses on smart driving, and latecomer Xiaomi has launched the "Boss Mi", which focuses on fashion and coolness.

Once GAC Aian is labeled as an “online ride-hailing” company, it will be very difficult to reverse it.

GAC, where should we go? 1 Net profit fell 97% year-on-year. Guangzhou Automobile Group (601238.SH) handed over an 'amazing' third quarter report. The financial report shows that in the first three quarters of this year, GAC Group’s revenue was 74.04 billion yuan, a year-on-year  - Lujuba

Radical marketing, action "deformation"

This "away" can also be seen from the direction of public opinion.

Looking back on the past year, GAC Group has repeatedly "overturned" in the marketing and public opinion positions.

, for example, was questioned about Xpeng. html In September, when the new car aion rt of Guangzhou Automobile Group was released and warmed up, it "opened fire" against the popular Xiaopeng new car mona m03. An article in the International Finance News showed that the new car release press release prepared by Aion listed six headlines. The first two pointed at Xpeng's new car M03, including "Aion waves its claws towards Mona" and "aion rt hits the Mona M03 head-on." ".

GAC, where should we go? 1 Net profit fell 97% year-on-year. Guangzhou Automobile Group (601238.SH) handed over an 'amazing' third quarter report. The financial report shows that in the first three quarters of this year, GAC Group’s revenue was 74.04 billion yuan, a year-on-year  - Lujuba

Such exaggerated wording surprised the cycling circle.

is an example of the popularity of Apple. On September 10, Apple and Huawei held new product launch conferences on the same day. Unexpectedly, GAC Aian’s official Weibo released the topic of “Three Technology Giants Huawei Aian Apple”, which aroused heated discussion.

GAC, where should we go? 1 Net profit fell 97% year-on-year. Guangzhou Automobile Group (601238.SH) handed over an 'amazing' third quarter report. The financial report shows that in the first three quarters of this year, GAC Group’s revenue was 74.04 billion yuan, a year-on-year  - Lujuba

This operation opened the eyes of netizens. Some people joked: "Huawei is responsible for technology, Apple is responsible for the giants, and Aian is responsible for the three." "Huawei and Apple are also getting better, and they are all following Aian."

Another example is cooperation with Sima Nan. html In June, Gu Huinan, general manager of GAC Aian, interacted closely with Sima Nan and shared the news that Sima Nan test drove Haopin. GAC Aian wanted to use the traffic of Internet celebrity Sima Nan to promote his brand, but unexpectedly, netizens did not pay for it. Instead, they were extremely emotional. Some netizens even said bluntly:

"I will never buy GAC because of Sima Nan." .

GAC, where should we go? 1 Net profit fell 97% year-on-year. Guangzhou Automobile Group (601238.SH) handed over an 'amazing' third quarter report. The financial report shows that in the first three quarters of this year, GAC Group’s revenue was 74.04 billion yuan, a year-on-year  - Lujuba

Behind this, it reflects the omissions of the GAC Aian brand marketing team. Sima Nan, who has been labeled as an "anti-American", has already collapsed because of being exposed that he has purchased real estate in the United States. Netizens also ridiculed him that "scolding the United States is a job, but going to the United States is a life."

Such a controversial Internet celebrity dares to invite cooperation. Is the GAC Aian brand marketing team disconnected from the Internet?

In fact, whether it is trying to win over competitors or trying to exploit hot topics, behind this kind of aggressive marketing is GAC Group’s performance anxiety. When people panic, their actions are easily deformed, and the same is true for companies.

GAC, where should we go? 1 Net profit fell 97% year-on-year. Guangzhou Automobile Group (601238.SH) handed over an 'amazing' third quarter report. The financial report shows that in the first three quarters of this year, GAC Group’s revenue was 74.04 billion yuan, a year-on-year  - Lujuba

Epilogue

It is not difficult to find that GAC’s stalling can be attributed to three factors:

The first is strategy. Due to subjective and objective reasons, GAC entered the new energy industry at the wrong time, resulting in a slowdown in potential growth.

The second is positioning. GAC Aian has benefited from online ride-hailing orders and has tasted the benefits, but it has also given consumers a stereotype.

The third is talent. There is a big difference between new energy vehicles and traditional fuel vehicles. New energy vehicles are more like "mobile phones on wheels". There are also differences in the demand for technical talents between the two. Looking at the new car-making forces, Xiaopeng once poached people from Tesla, and Xiaomi even poached the former dean of Geely Automobile Research Institute and more than 20 core personnel. The purpose of poaching people is to quickly build a technical team. In this regard, GAC seems to be more inclined to cultivate talents internally, and the speed must be slower.

So, where is the way out for GAC? The author believes that there are three directions for reference.

First, we need to adjust our strategy and fully develop new energy sources.

New energy is the general trend. Industry forecasts show that at the current speed, the Chinese market should be fully electrified around 2030. Just like when smartphones gradually replaced traditional mobile phones, although the process was full of twists and turns, they eventually became mainstream. For GAC, it's too late to change.

Second, to change tactics, we must have a clear positioning.

GAC still has not gotten rid of its dependence on joint venture brands. More than 60% of its sales come from the two major joint venture brands. This needs to change, let independent brands become the pillars, and strive to create powerful and popular products.

GAC has a foundation for this. Look at GAC Aion, which has been deeply involved in the pure electric field. In six years, it has become the fastest company to produce and sell one million pure electric models. However, Aion's presence has always been weak and not enough to attract young people.

GAC, where should we go? 1 Net profit fell 97% year-on-year. Guangzhou Automobile Group (601238.SH) handed over an 'amazing' third quarter report. The financial report shows that in the first three quarters of this year, GAC Group’s revenue was 74.04 billion yuan, a year-on-year  - Lujuba

The improvement of product strength requires investment. In the first three quarters of this year, GAC Group's sales expenses reached 4.467 billion yuan, while research and development expenses shrank from 1.311 billion yuan in the same period last year to 1.034 billion yuan. Without investment in R&D, where would the product strength and hot hits come from?

Third, reserve talents and explore overseas opportunities.

The logic of electric cars and gasoline cars are different, and the talent needs are also different. GAC needs to integrate more talents who understand electric cars. If the internal training is not fast enough, it can recruit people from outside.

In addition, to break the internal convolution, in addition to improving product strength, another way is to go overseas and involve foreigners. Toyota and Chery have already prototyped this, proving that it is feasible.

Looking through the three quarterly reports, the only bright spot of GAC Group is exports. In the first three quarters, GAC Group exported a total of approximately 95,000 vehicles, a year-on-year increase of 112.0%. At this year's Paris Auto Show, GAC Group also released a European market plan, planning to initially promote some products to enter European countries within the year and achieve full European market coverage in 2028. If you continue along this road, you may be able to "overtake" on the bend.

GAC, where should we go? 1 Net profit fell 97% year-on-year. Guangzhou Automobile Group (601238.SH) handed over an 'amazing' third quarter report. The financial report shows that in the first three quarters of this year, GAC Group’s revenue was 74.04 billion yuan, a year-on-year  - Lujuba

Objectively speaking, GAC Group has a long history and profound foundation. It has gone through many stages such as early exploration, the rise of joint ventures, and independent brands, and plays an important role in the development history of China's automobile industry. There is no doubt about its technical accumulation, engineering team, production line strength and supply chain perfection. It can be said that its foundation is very solid.

GAC, where should we go? 1 Net profit fell 97% year-on-year. Guangzhou Automobile Group (601238.SH) handed over an 'amazing' third quarter report. The financial report shows that in the first three quarters of this year, GAC Group’s revenue was 74.04 billion yuan, a year-on-year  - Lujuba

GAC, where should we go?

Net profit fell 97% year-on-year

Guangzhou Automobile Group (601238.sh) handed over an "amazing" third quarter report.

The financial report shows that in the first three quarters of this year, GAC Group’s revenue was 74.04 billion yuan, a year-on-year decrease of 24.18%; the net profit attributable to the parent company was only 120 million yuan, dropped 97.34% year-on-year; the net loss after deducting non-recurring gains and losses was 1.87 billion yuan, dropped 146.49% year-on-year; the net cash flow generated from operating activities was approximately 980 million yuan, a year-on-year decrease of 75.56%.

Looking at the third quarter alone, the company's revenue was 28.233 billion yuan, a year-on-year decrease of 21.73%; net profit loss was 1.396 billion yuan, a year-on-year decrease of 190.40%!

Is it because the entire automobile industry is not doing well, leading to the collapse of GAC Group's performance?

Let’s take a look at the performance of other car companies. The same is the third quarterly report:

BYD revenue was 502.251 billion, a year-on-year increase of 18.94%, and net profit was 25.238 billion, a year-on-year increase of 18.12%.

Great Wall Motors revenue was 142.254 billion, a year-on-year increase of 19.04%, and net profit was 10.428 billion, a year-on-year increase of 108.78%.

Cyrus operating income was 106.627 billion, a year-on-year increase of 539.24%, and net profit was 4.038 billion, a year-on-year increase of 276%.

GAC, where should we go? 1 Net profit fell 97% year-on-year. Guangzhou Automobile Group (601238.SH) handed over an 'amazing' third quarter report. The financial report shows that in the first three quarters of this year, GAC Group’s revenue was 74.04 billion yuan, a year-on-year  - Lujuba

Among the leading car companies, except for the "suffering brothers" SAIC and GAC, the other growth rates are quite strong.

Compare yourself again. Since entering 2024, stalling has become a keyword for GAC. In the first half of the year, GAC Group's revenue and net profit have both declined. This is also the first time that GAC Group has faced such a dilemma since it entered the Fortune Global 500 for eleven consecutive years.

GAC, where should we go? 1 Net profit fell 97% year-on-year. Guangzhou Automobile Group (601238.SH) handed over an 'amazing' third quarter report. The financial report shows that in the first three quarters of this year, GAC Group’s revenue was 74.04 billion yuan, a year-on-year  - Lujuba

The trend is also reflected in the capital market. As of the close of trading on November 11, 2024, Guangzhou Automobile Group's stock price was 8.82 yuan per share, , which had fallen 56% from the previous high, and had been cut in half.

In terms of market value, according to data from Yiniu.com, the historical market value of Guangzhou Automobile Group was once as high as 210 billion, has now evaporated nearly 120 billion.

GAC, where should we go? 1 Net profit fell 97% year-on-year. Guangzhou Automobile Group (601238.SH) handed over an 'amazing' third quarter report. The financial report shows that in the first three quarters of this year, GAC Group’s revenue was 74.04 billion yuan, a year-on-year  - Lujuba

Behind the fluctuations in data is strategic choice.
Judging from the timeline, Tesla entered China in 2012, NIO was established in 2014, Xpeng was established in 2014, and Ideal was established in 2015. BYD was earlier, launching its first new energy vehicle f3dm in 2008.
It will be 2017 when GAC starts to get involved in new energy vehicles, that is, it will establish " GAC Aian ". It can be said that GAC’s new energy layout is indeed a bit slow.
Of course, we can’t blame GAC for being “slow”. As a large state-controlled enterprise, GAC's decision-making must consider many factors and consult with multiple competent authorities. It is very prudent to make strategic layouts.
But many times, the situation waits for no one.
data shows that in 2017, the year when GAC Aion was established, China’s new energy vehicle market accounted for only 2.7%. But by 2023, China's new energy vehicle market share has reached 31.6%. In just 6 years, it has grown 11 times!
The territory of new energy vehicles continues to expand. Data released by the China Automobile Association shows that in October this year, the production and sales of new energy vehicles were 1.463 million and 1.43 million respectively, a year-on-year increase of 48% and 49.6% respectively. The sales of new energy vehicles accounted for 46.8% of the total sales of new automobiles.
It’s not that GAC doesn’t work hard, it’s because the potential of new energy is too strong!

Cars are not easy to sell, and the headquarters moved to the "countryside"

Handing over such a report card, what exactly has GAC Group experienced?

Let’s first look at GAC Group’s own explanation:

Mainly due to multiple factors such as the year-on-year decline in automobile sales during the period, increased business and government investment, declining profits, optimization of redundant production capacity by joint ventures, and increased exchange losses caused by exchange rate changes.

This statement seems relatively abstract. Let’s summarize the key points: Few cars are sold.

Starting from January this year, GAC’s sales have declined year-on-year for nine consecutive months. In the first three quarters of this year, GAC Group sold approximately 1.335 million new cars, a year-on-year decrease of 25.59%.

According to media estimates, the sales target that GAC Group hopes to achieve this year is 2.7555 million vehicles. In other words:

In the first three quarters of this year, GAC Group only completed about 48% of its annual sales target.

Specifically, in the first three quarters, the joint venture brand:

Guangqi Honda sold 309,000 units, a year-on-year decrease of 29.06%.

GAC Toyota sold 518,000 units, a year-on-year decrease of 24.49%.

Own brand:

GAC Trumpchi sold 277,000 units, a year-on-year decrease of 6.41%.

GAC Aian sold 227,000 units, a year-on-year decrease of 35.4%.

GAC, where should we go? 1 Net profit fell 97% year-on-year. Guangzhou Automobile Group (601238.SH) handed over an 'amazing' third quarter report. The financial report shows that in the first three quarters of this year, GAC Group’s revenue was 74.04 billion yuan, a year-on-year  - Lujuba

It can be seen that the joint venture brand is still the sales pillar of GAC Group, accounting for more than 60%. In other words, whether it is a joint venture brand as a pillar or an independent brand with high hopes, sales are declining sharply. It’s no wonder that GAC’s performance cannot be sustained.

GAC Group has actually sensed this situation for a long time.

For example, in the middle of last year, GAC Toyota started a large-scale layoff in the Chinese market, with more than a thousand employees. Subsequently, Guangqi Honda also revealed news of layoffs. The cumulative scale of the two layoffs accounted for approximately 20% of its employees in the Chinese market.

GAC, where should we go? 1 Net profit fell 97% year-on-year. Guangzhou Automobile Group (601238.SH) handed over an 'amazing' third quarter report. The financial report shows that in the first three quarters of this year, GAC Group’s revenue was 74.04 billion yuan, a year-on-year  - Lujuba

At the same time, Honda has announced the closure of two production lines in China, including Guangqi Honda's production line with an annual output of 50,000 vehicles.

A more intuitive action is that not long ago, the headquarters office address of GAC Group was moved from Zhujiang New City CBD to Panyu District, Guangzhou City. This was interpreted by the outside world as:

The GAC headquarters moved from Zhujiang New City to the countryside of Panyu.

GAC, where should we go? 1 Net profit fell 97% year-on-year. Guangzhou Automobile Group (601238.SH) handed over an 'amazing' third quarter report. The financial report shows that in the first three quarters of this year, GAC Group’s revenue was 74.04 billion yuan, a year-on-year  - Lujuba

News of the relocation of the GAC Group headquarters has actually been circulating for a long time. In October, GAC Group released the "Proposal on the Reform of Management Model and Organizational Structure", which stated bluntly that it would implement relevant organizational reforms to further reduce operating costs and improve management efficiency.

The relocation of the headquarters is part of "cost reduction and efficiency improvement". According to GAC Group, the purpose of the relocation:

is to promote the concentration of all elements to front-line practices.

This is true. In recent years, GAC’s core management has indeed been too far away from the front line.

This "away" is highlighted in positioning. When mentioning GAC Aian, many people will think of one word: , the king of online ride-hailing.

According to data from the Passenger Car Association, of the approximately 850,000 new online ride-hailing vehicles in 2023, GAC Aian contributed 220,000, accounting for 45% of its total sales. As the online ride-hailing market becomes saturated, GAC Aian must find a new way out.

But looking at the GAC Aian on the streets, let me ask, how many people, especially young people, would choose to buy a "same model as an online car-hailing car"?

This is a problem with "positioning". Looking at other new energy car companies, NIO focuses on services and battery swaps, Ideal focuses on family cars, Xpeng focuses on smart driving, and latecomer Xiaomi has launched the "Boss Mi", which focuses on fashion and coolness.

Once GAC Aian is labeled as an “online ride-hailing” company, it will be very difficult to reverse it.

GAC, where should we go? 1 Net profit fell 97% year-on-year. Guangzhou Automobile Group (601238.SH) handed over an 'amazing' third quarter report. The financial report shows that in the first three quarters of this year, GAC Group’s revenue was 74.04 billion yuan, a year-on-year  - Lujuba

Radical marketing, action "deformation"

This "away" can also be seen from the direction of public opinion.

Looking back on the past year, GAC Group has repeatedly "overturned" in the marketing and public opinion positions.

, for example, was questioned about Xpeng. html In September, when the new car aion rt of Guangzhou Automobile Group was released and warmed up, it "opened fire" against the popular Xiaopeng new car mona m03. An article in the International Finance News showed that the new car release press release prepared by Aion listed six headlines. The first two pointed at Xpeng's new car M03, including "Aion waves its claws towards Mona" and "aion rt hits the Mona M03 head-on." ".

GAC, where should we go? 1 Net profit fell 97% year-on-year. Guangzhou Automobile Group (601238.SH) handed over an 'amazing' third quarter report. The financial report shows that in the first three quarters of this year, GAC Group’s revenue was 74.04 billion yuan, a year-on-year  - Lujuba

Such exaggerated wording surprised the cycling circle.

is an example of the popularity of Apple. On September 10, Apple and Huawei held new product launch conferences on the same day. Unexpectedly, GAC Aian’s official Weibo released the topic of “Three Technology Giants Huawei Aian Apple”, which aroused heated discussion.

GAC, where should we go? 1 Net profit fell 97% year-on-year. Guangzhou Automobile Group (601238.SH) handed over an 'amazing' third quarter report. The financial report shows that in the first three quarters of this year, GAC Group’s revenue was 74.04 billion yuan, a year-on-year  - Lujuba

This operation opened the eyes of netizens. Some people joked: "Huawei is responsible for technology, Apple is responsible for the giants, and Aian is responsible for the three." "Huawei and Apple are also getting better, and they are all following Aian."

Another example is cooperation with Sima Nan. html In June, Gu Huinan, general manager of GAC Aian, interacted closely with Sima Nan and shared the news that Sima Nan test drove Haopin. GAC Aian wanted to use the traffic of Internet celebrity Sima Nan to promote his brand, but unexpectedly, netizens did not pay for it. Instead, they were extremely emotional. Some netizens even said bluntly:

"I will never buy GAC because of Sima Nan." .

GAC, where should we go? 1 Net profit fell 97% year-on-year. Guangzhou Automobile Group (601238.SH) handed over an 'amazing' third quarter report. The financial report shows that in the first three quarters of this year, GAC Group’s revenue was 74.04 billion yuan, a year-on-year  - Lujuba

Behind this, it reflects the omissions of the GAC Aian brand marketing team. Sima Nan, who has been labeled as an "anti-American", has already collapsed because of being exposed that he has purchased real estate in the United States. Netizens also ridiculed him that "scolding the United States is a job, but going to the United States is a life."

Such a controversial Internet celebrity dares to invite cooperation. Is the GAC Aian brand marketing team disconnected from the Internet?

In fact, whether it is trying to win over competitors or trying to exploit hot topics, behind this kind of aggressive marketing is GAC Group’s performance anxiety. When people panic, their actions are easily deformed, and the same is true for companies.

GAC, where should we go? 1 Net profit fell 97% year-on-year. Guangzhou Automobile Group (601238.SH) handed over an 'amazing' third quarter report. The financial report shows that in the first three quarters of this year, GAC Group’s revenue was 74.04 billion yuan, a year-on-year  - Lujuba

Epilogue

It is not difficult to find that GAC’s stalling can be attributed to three factors:

The first is strategy. Due to subjective and objective reasons, GAC entered the new energy industry at the wrong time, resulting in a slowdown in potential growth.

The second is positioning. GAC Aian has benefited from online ride-hailing orders and has tasted the benefits, but it has also given consumers a stereotype.

The third is talent. There is a big difference between new energy vehicles and traditional fuel vehicles. New energy vehicles are more like "mobile phones on wheels". There are also differences in the demand for technical talents between the two. Looking at the new car-making forces, Xiaopeng once poached people from Tesla, and Xiaomi even poached the former dean of Geely Automobile Research Institute and more than 20 core personnel. The purpose of poaching people is to quickly build a technical team. In this regard, GAC seems to be more inclined to cultivate talents internally, and the speed must be slower.

So, where is the way out for GAC? The author believes that there are three directions for reference.

First, we need to adjust our strategy and fully develop new energy sources.

New energy is the general trend. Industry forecasts show that at the current speed, the Chinese market should be fully electrified around 2030. Just like when smartphones gradually replaced traditional mobile phones, although the process was full of twists and turns, they eventually became mainstream. For GAC, it's too late to change.

Second, to change tactics, we must have a clear positioning.

GAC still has not gotten rid of its dependence on joint venture brands. More than 60% of its sales come from the two major joint venture brands. This needs to change, let independent brands become the pillars, and strive to create powerful and popular products.

GAC has a foundation for this. Look at GAC Aion, which has been deeply involved in the pure electric field. In six years, it has become the fastest company to produce and sell one million pure electric models. However, Aion's presence has always been weak and not enough to attract young people.

GAC, where should we go? 1 Net profit fell 97% year-on-year. Guangzhou Automobile Group (601238.SH) handed over an 'amazing' third quarter report. The financial report shows that in the first three quarters of this year, GAC Group’s revenue was 74.04 billion yuan, a year-on-year  - Lujuba

The improvement of product strength requires investment. In the first three quarters of this year, GAC Group's sales expenses reached 4.467 billion yuan, while research and development expenses shrank from 1.311 billion yuan in the same period last year to 1.034 billion yuan. Without investment in R&D, where would the product strength and hot hits come from?

Third, reserve talents and explore overseas opportunities.

The logic of electric cars and gasoline cars are different, and the talent needs are also different. GAC needs to integrate more talents who understand electric cars. If the internal training is not fast enough, it can recruit people from outside.

In addition, to break the internal convolution, in addition to improving product strength, another way is to go overseas and involve foreigners. Toyota and Chery have already prototyped this, proving that it is feasible.

Looking through the three quarterly reports, the only bright spot of GAC Group is exports. In the first three quarters, GAC Group exported a total of approximately 95,000 vehicles, a year-on-year increase of 112.0%. At this year's Paris Auto Show, GAC Group also released a European market plan, planning to initially promote some products to enter European countries within the year and achieve full European market coverage in 2028. If you continue along this road, you may be able to "overtake" on the bend.

GAC, where should we go? 1 Net profit fell 97% year-on-year. Guangzhou Automobile Group (601238.SH) handed over an 'amazing' third quarter report. The financial report shows that in the first three quarters of this year, GAC Group’s revenue was 74.04 billion yuan, a year-on-year  - Lujuba

Objectively speaking, GAC Group has a long history and profound foundation. It has gone through many stages such as early exploration, the rise of joint ventures, and independent brands, and plays an important role in the development history of China's automobile industry. There is no doubt about its technical accumulation, engineering team, production line strength and supply chain perfection. It can be said that its foundation is very solid.

wishes GAC well and hopes it can contribute to China’s automobile industry, Guangzhou and itself!

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