GAC Aion Completes Round-A Financing, Market Value Breaks 100B Yuan

Chinese automaker GAC Group announced on October 20 that its subsidiary GAC Aion has completed round-A financing of 18.294 billion yuan ($2.42 billion) from a total of 53 strategic investors, boosting its post-investment valuation to 103.294 billion yuan.

GAC Aion’s market valuation has now surpassed XPeng and Leapmotor, which are valued at HK$52.403 billion and HK$20.546 billion respectively.

The leading investors in this round of financing are still state-owned enterprise funds or local industrial funds. GAC Aion also introduced strategic support from enterprises in the fields of battery charging and swapping, battery manufacturing, chip design and manufacturing, and intelligent driving.

After completion of this round, the registered capital of GAC Aion increased from 6.421 billion yuan to 7.803 billion yuan, and the direct and indirect shareholding ratio of GAC Group changed from 93.45% to 76.89%.

GAC Aion is a new energy vehicle brand founded by GAC Group. Its target market has gradually changed from vehicles for public transportation to private cars. The brand’s main models include the Aion S, Aion LX and Aion V. Feng Xingya, the general manager of GAC Group, said at a performance meeting at the beginning of the year that GAC Aion should at least squeeze into the new car-making camp headed by NIO, XPeng and Li Auto.

Since August 30 last year, mixed ownership reform and financing work were started. GAC Aion completed internal asset restructuring in November 2021, employee equity incentive in March 2022 and shareholding system reform in September this year. In the future, the new startup plans to go public.

In September, the monthly sales volume of GAC Aion exceeded 30,000 units for the first time, reaching 30,016, setting a new firm record. According to data by the China Passenger Car Association, it ranks among the top five in the sales list of new energy vehicle enterprises in China after BYD, Tesla China, SAIC-GM-Wuling and Geely.

In the first nine months of this year, the cumulative sales volume of GAC Aion was 182,000 vehicles, up 132% year-on-year. This year, its sales target is 250,000 vehicles, and the current completion rate is 73%.

GAC Aion has now started construction of a battery R&D and trial line, set up an energy tech firm, and plans to set up an electric driving company. It has also signed a strategic cooperation agreement with mining giant Ganfeng Lithium.

SEE ALSO: GAC Aion Builds Power Battery Mass Production Line

However, like most EV startups, GAC Aion has not yet made a profit. From 2019 to 2021, it achieved revenues of 5.23 billion yuan, 7.61 billion yuan and 17.27 billion yuan, and losses of 620 million yuan, 690 million yuan and 1.39 billion yuan. Feng once said that the company was supposed to make a profit, but it was still in a state of loss due to price increase of raw materials.

Since the beginning of the year, NEV brands owned by traditional car companies have accelerated their pace of financing. SAIC subsidiary IM Motors completed its first round of market-oriented financing in August of this year, with a valuation of about 30 billion yuan, while Dongfeng Motor subsidiary Voyah started its first external equity financing in September. Zeekr, a subsidiary of Geely, has also opened up external financing channels.