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On the evening of November 11, Zero released its third-quarter 2024 results. According to the financial report, in the third quarter of 2024, the operating income of Zero cars was 9.86 billion yuan, an increase of 74.3 percent over the same period last year, an increase of 83.9 percent from a month earlier, a record high; a net loss of 690 million yuan, a narrowing of 30.3 percent compared with a net loss of 990 million yuan in the same period; gross profit margin of 8.1 percent, a sharp improvement from 2.8 percent in the second quarter.

Zero running Automobile said that the business growth was due to the increase in the delivery volume of new zero running cars, while the launch of the zero running C16 model led to a change in product portfolio and an increase in average selling price. The sharp improvement in gross profit margin is mainly due to the scale effect formed by the optimization of product sales structure, cost management and increased sales volume.

In addition, the financial report shows that in the third quarter, the operating cash flow of zero-running cars was 1.96 billion yuan, capital expenditure was 640 million yuan, and free cash flow was 1.32 billion yuan. Zero-running cars are expected to maintain positive operating cash flow and free cash flow in the fourth quarter and continue to develop.

As a car manufacturer, the revenue performance of zero-running cars is closely related to its delivery performance. In the third quarter of this year, 86165 zero-running cars were delivered, an increase of 94.4% year-on-year and 61.7% month-on-month.

Reviewing the development process of zero-running cars, it has been nine years since it was established in 2015, but the real development is in recent years. In September 2022, zero-running cars were listed on the Hong Kong Stock Exchange, becoming another new car-building force after Wei Xiaoli, but by contrast, zero-running cars are still losing money. For reference, the net loss of zero-running cars in 2023 is 4.216 billion yuan.

Fortunately, zero-running car sales have grown rapidly since 2024, which is a key reason for its revenue growth. Data show that in October, zero-running cars delivered 38177 new cars, an increase of 109.74 percent over the same period last year, setting an all-time high for five consecutive months. By the end of October, a total of 211000 vehicles had been delivered this year, an increase of 97.18% over the same period last year. Zero-running cars only need to complete about 40, 000 vehicles in the next two months to achieve the annual sales target of 250000 vehicles.

At present, zero-running cars on sale include zero-running C11, zero-running T03, zero-running C16, zero-running C10, zero-running C01. According to the plan, zero-running cars will launch three B-series models in 2025, of which B10, the first model of zero-running new B-series, will be unveiled at this month's Guangzhou Motor Show. The car is positioned as a compact SUV, focusing on the 10-150000 yuan market, and is expected to go on sale by the end of the first quarter of 2025. In addition, Zero said that B-series products will become its new sales growth point in 2025.

For the fourth quarter, zero management expects to exceed the annual sales target of 250000 vehicles by the end of the year, the gross profit margin in the fourth quarter is expected to maintain a steady increase in the third quarter, and the net loss is expected to continue to narrow. Zhu Jiangming, founder, chairman and CEO of Zero Motor, said on the earnings call that sales are expected to rise significantly in the fourth quarter of this year compared with the previous quarter. As for next year's sales forecast, Mr Zhu said he expected monthly sales of 40, 000 vehicles, with a full-year sales target of 500000 and a gross profit margin of more than 10 per cent. Of course, with the increasing competition in the new energy track, zero-running cars are bound to face fierce competition.

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