On August 19, corporate information from Tianyancha showed that Chongqing Jinkang Power New Energy Co., Ltd. has recently undergone industrial and commercial changes. Chongqing Science City Urban Operation Group Co., Ltd., a previous shareholder, has withdrawn from the list of shareholders, and its shares have been taken over by Seres Automobile Co., Ltd. After the acquisition, Seres’ shareholding ratio increased from the previous 51.46% to 100%.
According to data, Chongqing Jinkang Power New Energy Co., Ltd. was established in January 2018 with a registered capital of RMB 1.03 billion. As a new energy vehicle powertrain solution provider, its business scope mainly covers new energy vehicle motors and electronic control systems. Currently, Jinkang Power’s motor manufacturing workshop has 22 existing production lines, with an annual production capacity of 1 million complete vehicle powertrains.
In fact, there were early signs that Seres Automobile would hold 100% equity in Jinkang Power. On August 15, Seres issued an announcement stating that, to improve the efficiency of overall business decision-making, enhance synergy among subsidiaries, and maximize operational benefits, its holding subsidiary Seres Automobile Co., Ltd. acquired the 48.54% equity held by Chongqing Science City Urban Operation Group Co., Ltd. (the minority shareholder of its holding subsidiary Chongqing Jinkang Power New Energy Co., Ltd.) through public listing, with a transaction price of RMB 663.45 million.
Notably, Seres has carried out several large-scale acquisitions in the past year or two. In September last year, the official announcement stated that it would invest RMB 8.1 billion to acquire 100% equity of Chongqing Liangjiang New Area Longsheng New Energy Technology Co., Ltd. (Longsheng New Energy). It is understood that the AITO series models have long been produced by leasing Longsheng New Energy’s super factory. Although leasing has met production needs to a certain extent, it also brings certain instability. The acquisition of Longsheng New Energy is conducive to strengthening Seres’ control over the production link and, at the same time, helping to reduce costs.
At that time, regarding the acquisition of Longsheng New Energy, Seres stated that it would help the company maintain advanced productivity to drive high-quality development, ensure the integrity of production-side assets, promote the implementation of the overall business strategy, and lay a core foundation for performance growth. In August of the same year, Seres acquired a 19.355% stake in Seres Automobile Co., Ltd. held by Chongqing Jinxin Equity Investment Fund Partnership (Limited Partnership) for RMB 1.329 billion, thereby holding 100% control of Seres Automobile Co., Ltd. Subsequently, the official further purchased a 10.00% stake in Shenzhen Yinwang Intelligent Technology Co., Ltd. held by Huawei Technologies for RMB 11.5 billion.
From the acquisition of technology to super factories, it is not difficult to see Seres’ rapid development in the past two years. Of course, Seres’ rapid development is inseparable from the support of Huawei. Initially, the predecessor of Seres Group was Chongqing Xiaokang Industrial Group Co., Ltd., established in September 1986, which had little brand awareness in the market. After cooperating with Huawei in 2021, it gained significant exposure. At that time, the two parties jointly launched their first model, the Seres SF5, a mid-sized coupe SUV with a price range of RMB 216,800 – 246,800. However, possibly due to factors such as insufficient product competitiveness and low brand awareness, the Huawei Smart Selection SF5 did not gain market popularity after its launch. Relevant data shows that the cumulative sales of Seres SF5 in 2021 were 8,169 units.
To reverse the sluggish sales, the two parties jointly launched the AITO brand and successively launched models such as the Seres SF5, AITO M5, AITO M7, and AITO M9. With the support of multiple models, Seres began to turn losses into profits. In the first half of last year, Seres achieved a profit turnaround, with a net profit of RMB 1.781 billion, gradually becoming a leading domestic automaker. For reference, Seres had been in a state of loss from 2019 to 2023. Data shows that from 2019 to 2023, Seres’ non-net profit losses were RMB 884 million, RMB 2.308 billion, RMB 2.793 billion, RMB 4.296 billion, and RMB 4.817 billion respectively, with a cumulative loss of over RMB 15 billion in five years.
Returning to the move of acquiring Jinkang Power’s shares, the official stated that it will help the company enhance its R&D capabilities in the new energy vehicle field, improve its comprehensive advantages, and achieve the company’s overall business goals. In this regard, industry insiders pointed out that the funds for this acquisition are not large for Seres. Acquiring Chongqing Jinkang Power New Energy Co., Ltd. to become a wholly-owned subsidiary of Seres is conducive to its subsequent strategic layout and improving Seres’ overall competitiveness.
