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Recently, well-off shares issued a pre-loss announcement for the half-year performance in 2022: the net profit loss attributed to the owner of the parent company is expected to reach 1.6 billion yuan to 1.76 billion yuan in the first half of 2022, compared with a loss of 481 million yuan in the same period last year. As for the reason for the loss, it said that it was due to the continuous investment in research and development of Selis new energy vehicle products, as well as the large investment in fixed assets in the early stage, production and sales volume was still in the climbing stage, and depreciation and amortization expenses increased; in addition, with the marketing promotion of Selis new energy vehicle products, marketing expenses, labor costs and other factors increased, resulting in the company owner's net profit of about-1.439 billion yuan.

At the same time, the announcement also pointed out that the company's operating income reached 12 billion yuan to 12.6 billion yuan in the first half of 2022, up 62.5% to 70.63% from the same period last year. As for the substantial increase in the company's operating income, Xiaokang shares said that it was mainly due to the monthly increase in the delivery volume of Selis new energy vehicles and the net cash flow of the company's operating activities. At the same time, the gross profit margin of the company's new energy vehicles also increased compared with the same period last year.

According to relevant data, Xiaokang Co., Ltd. was established in 2007, with Dongfeng well-off Automobile, Xiaokang Automobile Power and Ruichi New Energy vehicle and other car companies, among which Cyrus is the brand of Chongqing Jinkang Selis Automobile Co., Ltd., affiliated to Chongqing Xiaokang Industrial Group Co., Ltd., founded on November 6, 2017, mainly focused on the field of new energy electric vehicles. According to public information, Xiaokang shares have invested nearly 10 billion yuan in R & D, accounting for more than 10% of the current operating income all the year round. At present, Xiaokang has more than 3000 R & D personnel and reserves nearly 3000 core technology patents, of which 157are invention patents.

In April last year, Huawei announced a partnership with Cyrus to launch its flagship model, Selis Huawei Smart SF5, which can be ordered simultaneously on Huawei's website and its stores, in addition to being sold through its own channels. With Huawei's blessing, Xiaokang shares also ushered in their own highlight moment, with the share price soaring from 23.64 yuan to 78.23 yuan. However, compared with the share price, Selis Huawei Smart SF5 sales in the market is not optimistic. According to relevant data, Cyrus SF5 sold only 8169 vehicles in 2021.

Or because of the poor sales of Cyrus Huawei Smart SF5, Huawei and Cyrus have also accelerated the pace of launching new brands. On December 23rd, M5, the first model of the new high-end new energy brand AITO, was released. The M5 is the second cooperation between Cyrus and Huawei. The difference between the M5 and the first cooperation is that Huawei has participated in the design of the car. The biggest highlight of the new car is that it is equipped with the new HarmonyOS intelligent cockpit for the first time, which makes the intelligent level of the AITO M5 higher than that of the same class models. On July 14 this year, the second model of the AITO brand, the M7, was launched, and the new car positioning medium and large SUV launched a total of three configured models with a price range of 31.98-379800 yuan. Among them, the comfortable version starts from 319800 yuan, the deluxe version starts from 339800 yuan, and the flagship version costs 379800 yuan. The new car will be delivered in early August.

In order to speed up the transformation of new energy vehicles, in addition to launching new brands, Xiaokang Co., Ltd. also announced in May that its wholly-owned subsidiary Chongqing Jinkang New Energy Automobile Co., Ltd. has officially changed its name to "Selis Automobile Co., Ltd.". The reason for changing the name is mainly to show the company's determination to strengthen the strategic transformation of new energy vehicles and the future development direction, which will also help to strengthen the logo of well-off shares in the field of new energy vehicles, and further enhance the brand recognition of "Cyrus Automobile".

According to Cyrus, a medium and large electric SUV and a full-size electric SUV are expected to be launched in 2022 and 2023 respectively, both of which will have both add-on and pure electric versions. In 2023, a compact all-electric SUV will be launched at the same time.

But as we all know, car-building is an industry that continues to spend money. Li Bin of Xilai Automobile once said bluntly that building a car is a very expensive thing, so if a start-up wants to build a car, it needs at least more than 40 billion of the capital, otherwise it will not be done well. In addition, we also need to improve the efficiency of the use of funds, because the car-building industry chain is very long, any of the links do not control the cost, it will lead to high cost of mass production, resulting in the loss of market competitiveness. On July 7, Huawei Yu Chengdong also revealed at the 14th China Automobile Blue Book Forum that the car is the only loss-making business for Huawei at present. Huawei has invested a lot in the automotive business, reaching more than $1 billion every year. "this area is definitely a very expensive game, an absolutely lossmaking business, and definitely a very difficult business to do."

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