Geely Automobile Holdings Ltd

Mr. Gui Shen Yue, CEO and Executive Director of GD Automotive Holdings Limited. Mr. Gan Jia Yue, CEO of GD Auto Group, Executive Director of GD Automotive Holdings Limited. And Mr. Dai Yong, CFO of GD Auto Group. Also, we have invited with us Madam Zhang Jing Ying, now Independent Director, to be with us over this conference. So I think the hot spell of Hangzhou happens to be coinciding with the booming market in China. So today we have three sections for today's brief conference. First of all, we will hand over to Mr. Dai for a brief interview followed by Mr. Gui's opening speech and further followed by the Q&A session. Apart from our offline audience, you are all the more welcome to type in your questions through the online channels. So over to you, Mr. Dai, for some introductions. Okay. Thank you very much for your introduction. Mr. Moderator, dear investors, and friends from the media, good afternoon. My name is Dai Yong. It is my pleasure to present the GD Automotive results for the first half of 2025. During the first half of this year, GD Automotive continued its strong momentum growth, recording all-round increases in sales volume, market share, revenue, and core profit. Sales volume-wise, we delivered about 1.409 million units in the first six months, up by 47% year-on-year, far outpacing the industrial average of 13%. In terms of market share, for the first time ever, we exceeded 10%, reaching 10.4%, an increase of about 2.4 percentage points year-on-year. In terms of revenue, our sales revenue amounted to about RM150.3 billion, up by 27%, maintaining steady and sustained growth. The core net profit attributable to the parent company reached about RM6.66 billion, up by 102% year-on-year, achieving a double-digit growth rate of our profit. Now let me come to the brief introduction of the details. In terms of the sales performance, actually I've already told you that we delivered about 1.409 million units in the first half, a new historical high. Both ICE and NEV vehicles achieved parallel growth and continuously consolidating our market base. In terms of ICE market, 684,000 units in the first half were sold, an 8% increase year-on-year. And in terms of NEV, about 725,000 units were sold, another record high, representing an area of about 126%, far exceeding the industrial average. And the Galaxy brand has achieved its new explosive growth, recording about 548,000 units, up by 232%. NEV penetration rate increased about 51.5% for the first half of this year, with domestic NEV penetration rising to 55.9% above the industrial average. In terms of exports, the total export volume was about 184,000 units, down by 8% year-on-year. Despite its performance still, we have maintained outstanding performances of our NEV exports, reaching about 40,000 units, up by 146%. We are of the belief that in the days to come, EV exports will continue to become an important driver of a future growth for EGD Group. The rapid growth of EGD has actually been the strong boost behind both revenue and the gross profit to new highs. The total revenue exceeded about RM150 billion, up by 27%, of which vehicle revenue was about RM134.6 billion, up by 28%. Gross profit totalled RM24.7 billion, up by 24% in terms of gross margin. Despite increasingly fierce competition in China, the gross margin remained stable for the first half of this year. at about 16.4%. Despite the slight 0.3 percentage point decline compared with 16.7% in the first period of this year, that decline was mainly because of the uneven growth rates of products within different gross margin profiles. In terms of the skill effects, the selling expense ratio and the selling and administrative expense ratios declined markedly. In terms of the selling expense ratio, it fell to about 5.6%, down by 16% year-on-year, and the administrative expense ratio dropped to about 1.9%, down by 26%. In terms of R&D, the total investment for the first half of this year was RMB 8.3 billion, down by 8.6%. The R&D ratio declined from 7.7% to 5.6%, a drop by 28 percentage points, demonstrating rapid gains in R&D efficiency. The absolute decline in R&D spending reflects the increasingly deficient use of the resources and product portfolios. In terms of profitability, In a general perspective, the strong sales growth and improved product profitability drove core net profit attributable to the parent to 6.66 billion RMBY, up by 102 percentage points. Why oh why? Because of that huge boost. So we benefit a lot from the per unit profitability enabled by a rapid increase in the core net profit margin. Especially for the NEV sales sector, The core net profit per unit rose to roughly 4,700 RMB yuan, up by 37 percentage points year-on-year. The core net profit margin expanded from 2.8% to 4.4%, an increase of about 57%, leading the industrial average. The profit growth has also provided abundant cash flows and reserves to the whole company. The total cash flow reached 58.8 billion RMB yuan hitting another record high the net cash also stood at a high volume and the operating activities contributed about 15 billion yuan in net cash flow during the first half and the ongoing optimization of operations continues to supply the group with substantial liquidity now let me come to different groups under our GD automotive company in terms of GD galaxy The sales volume reached 548,000 units, up by 232 percentage points a year, with market share about 8.4%, firmly placing the brand in the top tier of China's NEV market. of Geely maintained the top position across all passenger vehicle segments in China. Xinyao 8, which was launched on May 9th, became the best-selling plug-in hybrid B segment sedan across all brands. The domestic sales of Geely China Star ICE models reached 474,000 units up by 21% year-on-year, marking the ninth consecutive year as China's top-selling China brand ICE passenger vehicle series. The China Star continues to lead with counter-cyclical growth, raising its market share to 8.7%, up by 1.6 percentage points. There are a lot of notable performances, including Xin Yue L remains the best-selling ICE SUV across all segments, Bing Yue is the best-selling China brand A0 segment ICE SUV. First half of this year, the Zika and the Lincoln Co. brands completed a strategic integration with synergies already coming to its shore. For example, Zika, we sold about 91,000 units up by three percentage points year on year. Zika produced products cover key premium segments and the brand continues to rank among the top Chinese new energy premium marks. The 007 GT Shooting Brake achieved 10,000 units produced and delivered within its first month, become the ideal first premium shooting brake for young customers to date at about 300,000. Zika Shooting Brake Models has rolled off the line. Lincoln Co. 154,000 units were sold up by 22 percentage points. Cumulative deliveries also surpassed 1.5 million units. Since the launch on April 28th, the Lincoln Co. 900 has ranked among the top three full-size hybrid SUV vehicles in its segment. Also during this half year, Genie's globalization has also taken a quickening pace of acceleration. As evidenced by the following few aspects, first of all in terms of sales, NEV exports gained speed and prospered well in multiple markets, in which NEV export volume exceeded 40,000 units, up by 146%. The GD-EX5 and the EMA-S7 together exported more than 22,000 units, leading the pure electric market in Malaysia and a compact SUV segment in Costa Rica. Zika 009 leads the MPV segment in Hong Kong of China and a luxury pure electric MPV segment in Thailand and Malaysia. Also, we have seen the rollout of a lot of new products. The GD brand has entered about 85 overseas markets with more than 1035 sales outlets and service positions. Zika demonstrated strong competitiveness in global premium and EV markets, winning the premium brand sales crown or championship in Hong Kong, China, and pure electric brand crown in Kazakhstan. Lincoln Co expanded its global footprint. For example, in Europe, we have a European dealer network reaching about 58 yacht leaders and 08 EMP officially entered the European market in June. We have a lot of overseas international partnerships cementing its collaboration. For example, Proton sold about 77,000 units in the first half of this year. The pure electric SUV E-MAS7 exceeded 4,000 units and became Malaysia's best-selling EV. Renault Korea has sold about 47,000. The Renault Grand Collier SUV reached 26,000 units and ranking up on the top three hybrid SUVs in Korea. In terms of technological distribution in the field of AI, we not only possess industrial leading computing power, large models and big data, but also deliver their concrete and impressive AI applications in all fields. For example, assisted driving system, we unified our systems under the name Qianli Haohan, with solutions ranging from H1 to H9 deployed. across different models to demonstrate the safety. In terms of smart cockpit, the next generation Flyme Auto will be launched during the next half of this year. The Galaxy M9 will be the first model to feature an end-to-end AI voice large model, delivering human-like emotional voice and interaction. Also, over WAIC 2025, the smart egg cabin equipped with the preview version of Agent OS stood out among more than 3,000 exhibits and was awarded conference's top honor of treasurer of the pavilion. We use AI to improve our powertrain system. The new generation Thor EMI AI hybrid system has reached an industrial leading engine thermal efficiency of 47.26%. The AI digital chassis delivers all-round improvements in safety, handling and comfort. In the area of SG, Gini has always practiced long-term sustainable growth mentality. By the end of June 2025, the critical degree of full life cycle CO2 emissions per vehicle has fallen by 23.5% compared with 2020 standard, further advancing towards the year-end target of 25%. we actually perform quite comfortably well compared with some other competitors in this regard. And based upon this above-mentioned few aspects, we have uplifted the sales volume to a new high. From January to July, the cumulative delivery reached about 1.647 million units representing 54.7% of the A new target, in the second half, we will fully deploy across product launches, technological innovation and overseas expansion to ensure the new target. We hope to launch four all-new NEV models and another four are scheduled for launch. GDA Galaxy will introduce the mainstream plug-in hybrid sedan Galaxy A7 in August. The first model to feature the Thor EMI 2.0 AI hybrid system and the Qianli Haohai H3 assisted driving system. In the third quarter, the flagship plug-in hybrid SUV Galaxy M9 equipped with H5 and multiple new AI technologies will be coming to the foreground. The compact plug-in hybrid sedan Galaxy XIN YAO 6 will also follow. in the fourth quarter. Geely China Star will launch the fifth-generation M Grand in the second half. The refreshed versions of Xin Yue L, the Xin Rui and Bo Yue will be rolled out successfully. The China Star brand will also comprehensively upgrade its mainstream ICE products with full intelligence to deliver high-quality, high-intelligence ICE vehicles, with the Zika 9X in the next second half will be also introduced.

The co-models will also receive updates with improvements in assisted driving and electric drive system. For Lincoln Co., they will launch the Lincoln Co. 10 EMP in the third quarter, the first model to feature the new generation. Talking about experts, in the second half of this year, the GD brand will enter Brazil, the United Kingdom, Italy, Poland, South Africa, and a lot more overseas markets. For Zeker, it will enter Switzerland, Denmark, and Belgium market. The Lincoln Co. brand will further expand the dealer network into the Czech Republic, Austria, and Switzerland market. In external cooperation, the company will establish a joint venture with Renaud in Brazil under an asset-light model, leveraging Renaud's local production capacity and sales channels to enable rapid market entry. Looking forward in the face of even more complicated scenarios in 2025, the corporate management with unwavering strategic results and forward-looking visions fully leverage the competitive advantage of systematic synergy, accelerating the deep integration of AI technology with advanced manufacturing and strive to become a technology company with formidable intelligent manufacturing capabilities. That concludes my presentation. Thank you very much. Thank you, Mr. Dai, for your wonderful presentation. Next, I would like to invite Mr. Gui to address the audience. I would like to offer my gratitude to all the audience, both offline and online, for your long-term interest in GD Auto. I would like to give you a bit of explanation. On May the 15th, we launched a quarterly report release and on May the 7th an acquisition bidding was also offered so the May 15th conference was held not only for the release of the quarterly business performance but also a venue where we can give you the explanation of our business strategies in the future Mr. Li Donghui and other senior executives were present at the May 15th conference. Because of the mergers, an acquisition has not been completed legally. So our MC still stick to the original job titles when introducing the attendees of today's press conference. So this is a bit of the explanations of our job titles. It doesn't mean that we have incurred any other changes after the May 15th conference. As to our first half of 2025 business performance of GD Auto there are a couple of highlights I would like to share with you first of all we efficiently resolutely implemented the title declaration from the end of last year to the beginning of this year once we complete the mergers between Lincoln Co and Zika as the synergy improves after the mergers we found that the co-existence of the two public companies will continue to serve as a hindrance to in-depth integration and the co-existence of the two publicly listed companies will still incur some duplicated investment. So that's why we made a strategic decision to turn this two listed company into one listed company. As I just said, we resolutely implemented the title declaration in the past couple of months. we've made notable achievements and we've made smooth and efficient progress so far. On May 17th, we issued an offer for acquisition and the contract was signed subsequently, you're probably interested in the exact date on the closing of the deal. If on May the 17th, May the September shareholders assembly and Gili Auto's shareholders assembly all give a green light to this acquisition deal, I think the case will be closed successfully legal-wise and the transaction will be completed by the end of this year. This grand mergers between the two listed company is deemed as the first highlight for Geely Auto in the first half of 2025. I would like to say that this mergers between the two publicly listed companies is of strategic importance to Geely in the future. Given the current auto market situation in China, the big merge will ensure the future business success of Geely as a whole. Based on the financial results we just released, I'll give you a brief recap of our financial performance in the first half of 2025. As to sales performance, the PPT shows we completed about 1.409 million units, which is a record high for half year sales performance. This 1.5 million is just a number. What really matters is everything behind this number. Most importantly, I think you just catch this message from our PPT, that across different segments, the whole spectrum of the segments in the market, our market share, for the first time in history, exceeded a double digit, reaching 10.4% of the total market. Geely currently ranks number two in China in terms of its sales volume. And the number one auto brand in China accounts for 14.77% of the market share. So we're still four percentage behind the number one auto brand in China. So last year the difference is eight percentage points. So after six months of development, yes, we still ranked number two in terms of market share. Yeah, the differences between number one and number two decreased by 50%. If we take a look at the breakdowns of this number, we found that And Geely ICE is the most intelligent and the most fuel efficient models among all the Chinese brands, auto brands. I think in the future Geely will continue to hold its number one position in the ICE market in China. Now let's turn to new energy vehicle market. Right now our market share is for 4%. So what does it mean? Yes, Geely NEV market share allows Geely ranks number two in China. And number one's market share is 21.8%. So there is still significant difference between number one and number two in terms of market share. So if you take out the overall market spectrum, the difference is only a fourth percentage point.

But in new energy vehicle market share, there is still a...

but we still we've made substantial progress in the past six months well last year the number one Chinese brand enjoyed a 34 percent of market share and our market share last year was only seven percent so last year there is a 27 percentage point differences between number one and number two in terms of market share so this year we increased our market share to 11.44 and the number one China brand accounts for let's say 29.8 percent of market share so we decreased the differences by one-third over the past six months that's the real meaning behind the shipment volume of 1.4 million units during the first half of this year I can tell you very confidently that particularly with regard to NEV this market share differences will continue to shrink I'm confident about this because for many many years Geely Auto placed high importance and emphasized on architecture and platforms. In our GEA platform last year, we launched the Galaxy series models with a lot of blockbusters rolling off the assembly lines. Our Xingyue models for the first six months in 2025 remain a number one brand across all segments and XINJIA 8 also maintains a very very high market position and Galaxy H7 with its very short existence in the Chinese market it also registered a very glibbering performance we have all the reasons to believe as we improve our product matrix in the ANEV portfolio We believe we can fill in a lot more market blank in the NAV market once we fill our models into the segments. We haven't occupied yet. We believe we can continue to increase our market share, decreasing our differences between number one and number two brands in terms of market share, and probably we're going to catch up with the number one and become number one. So this is my interpretation of that sales volume of 1.4 million units during the first half of this year. And thirdly, I'm going to talk a little bit about the profit. The core profit to parent is 6.6 billion for the first half of this year. So it's 200% of the same period of last year, which was only $3.3 billion. We can further break down that $6.6 billion into different smaller segments. By calculation, you find that the net profit margin to Perron is about 4.5%. Last year, the figure was only 2.8%.

So this is really a huge growth. You know that for those leading companies or players in China's auto market, the net profit margin is somewhere around 5%, which is sufficient enough to suggest that against the main backdrop of transformation based upon new EVs, our net profit margin began to turn around. which is quite close to the industrial top level so if you further break down this attributable profit margin to some details for per unit of car the first of this year has saw this figure standing at about 3,500 and the net profit for each car for first of this year has reached over 4,700 RMB which is a really significant boost compared with the previous level So the single unit net profit is a really key indicator suggesting the overall performances or the profitability of the whole system. So I think that the scale economy can be further released or reflected through the improvement of this figure. At the same time, as a result of the so-called main or the overall integration at all level, this will also be translated into the significant reduction of costs on all fronts. I am of the confidence that the single unit net profit or net profit margin will also improve significantly for the next half of this year. Well, that brings me to the next point, which is what I told you over the previous interim result conference last year, as I said, the sales volume each half year will be hitting a historical high for that particular half year, but there has been very little mention over the so-called profitability levels of the performances. However, based upon the performance for the first half of this year, we are very confident that in the days to come, we can achieve a double growth not only on the sales volume but also on the profit margin, especially against the backdrop of the transformation of the driving systems to an EV market and against the new backgrounds of the market changes. So I think that each round of interim result conference can also be together with the improvement of our profitability on all levels to bring more benefits or rewards to our shareholders. These above-mentioned three points conclude my comment on the so-called performance result announcement. I think these progress and achievements are largely attributable to, on one hand, the improvement of the quality of the products, on the other hand, the improvement of the technological. expertise. I'm sure that you may have a lot of questions related to autonomous driving and many other fields. I think we can leave more time for interactions between our media investors and our management officials here. So much for those positive things about the result conference. But that does not prevent me from mentioning a little bit about something that we need to do better in the future. I think that we still have a lot of things to do better. But due to the time limit, I don't think I have much time to elaborate each and every part of this list of the so-called things to improve. I want to dwell upon some of the most important things. First of all, brand recognition and building. Since day one of GD Auto Group, three decades have passed during which there has been a sea change of the auto market in China in terms of brand building, Especially after or in the wake of the drastic changes of the auto market in China, there have been a lot of things that we need to do better in the future. So I think that we need to face those shortcomings squarely and seriously. What holds key to brand building is to treat customers first or customers always first. For us specifically, that means the driving experiences, the driving emotional feelings are equally important to the success of the brand building journeys of whichever company in this market.

The driving experiences

are largely determined by the very product quality of our cars. But the good psychological feelings of the customers or the users of our cars could be another very tall order for us to achieve. So what we really need to do is to work even harder to ensure that our customers may be left with a better impression of our cars and products. So this is largely attributable to many reasons. So I want to develop on some of the main aspects or the factors. Now you can see that the smart technologies are developing by leaps and bounds. The future plan for the launch of the product portfolio is a critical link of the whole chain. If we hide the product portfolio launch plan or schedule from knowledge of our customers, that is equivalent to the denial of the knowledge on the part of the customers, hence the better recognition of our brands. I think there is still a long way to go based upon our key lessons to draw from. Here, I want to avail myself of this opportunity to express my sincere apologies to those customers under whichever product groups under GD Automobile Holdings Limited who may have those feelings. My strong and sincere apology for those feelings that you may not feel quite good about. Well, we have been doing a lot to improve or to change the impressions. I want to give you some examples. On August the 8th, the Zika brand in China has announced the plan for the launch of four revisions of the existing models. In parallel to this announcement, we have also made public some policies related to the preferential treatment, or some of the interest accumulation on the part of the existing customers. So the response to those policies could be described as quite positive. These are examples illustrative enough of the fact that they know very well about the real intentions behind those actions or policy announcements. So if you confer the right of knowledge or the right of choice to the customers, I think our customers will feel positively about our brands still. Also we are sensitized to this very important fact that customer first is by no means an empty slogan. Maybe the early announcement of those product plans may deliver an impact upon the sales volume in the days to come. However, the customer first was therefore being substantiated. That is to say, customer first is by no means an empty slogan. we have to put customer first ahead of anything else. This has to be implemented to the letter. This is the very basis upon which we can build a strong edifice of our brands. This only covers one aspect of the comprehensive system of building a strong brand. of course there are many other different lessons to draw from in the days to come in the next step I think that for all the brands we have to do even better we need to set up a better channel through which we can interact more vigorously and actively with our customers by putting our hearts first we have to hawk the real voices and opinions from our customers. Only by doing so can we build a strong brand. And the companies will benefit immensely from such a practice. So this is the first key lesson I want to share with you about brand building. Secondly, export. As I said, 1.409 million cars sold is a key reflection of the progress we've made. However, we have to be aware of some issues that we need to fix in export, which is down by 8 percentage points compared with last year. I remember that over Q1 results call, I have made clear to you that There have been a lot of things we need to do better in terms of the market surveys, investigations, knowledge of the overseas market and the product insufficiencies. Of course, there are some structural reasons of the product launch. I want to leave this part to Mr. Gan for more introductions. No matter what it is, the eight percentage point down reduction of the export is really a key reflection of something that we have to do better in the future. This is also a mismatch of our good performance in the domestic market and this is also the most staring issue against those positive results. That is the main reason why over the past few months we have revised and polished the whole structure and we have set up quick response systems in the overseas market. Also, we have deployed a lot of channels to facilitate the sales of more cars through these channels. I'm sure that with the launch of more NEV models in all markets or key markets in the overseas market, I'm confident that the second half of this year will see a rising increase or a rise of our sales volume. I'm quite still confident that for the whole year, the export sales volume can still be quite positive. by evening out the discrepancies or some seasonal or monthly differences across the whole year. This is the second key drawback I need to share with you. The third issue I need to talk to you about is despite the profitability which is quite good by doubling based upon the previous period, still there are some things we need to be clear which is the single car average selling price. We have seen the reduction of the average selling price per car by about 15,000 RMB for the first time ever in our history. Secondly, our gross profit margin has dropped by about 0.3%. The reasons are as follows. On one hand, the rapid rise of the Galaxy brand in the market has actually made the base figure much larger than in the past. This is also another key reflection of the slow speed of our growth in the top and the premium product segment, which is in mismatch with the overall growth plans of Geely in general. I think for the next half of this year, a lot needs to be done to improve the current scenario, especially with the launch of Lincoln Co. 900 series and also with the launch of 9X and EM9 of Galaxy and some other high-priced models, I think we can see a positive

turnaround of the year average selling price per vehicle or the gross profit margin so this is Sasha coming in the year gross profit margin and gross profit in the first half of this year and this is my explanations So this is my very quick recap of our business performance in the first half of this year. And I think you're more interested in the future growth trajectory of Geely Auto. A clear conclusion is that we are very confident about the whole year target of 3 million sales target. So Geely Auto is probably the only Chinese auto brand that significantly changes annual sales target after July this year. The one thing I want to emphasize is that the achievement we made during the first half of 2025 is not groundless achievement. They are solidly built on our deep understanding of the Chinese auto market and a whole series of measures we've taken based on that understanding in the area of intelligence and technology, technological development and construction of the ecosystem. We made these achievements because we made investment in technology in the ecosystem I read a lot I read about some estimate and forecast on how many Chinese auto brands will survive in the future and all these forecasts were made based on the launch of some specific models from specific auto brand I think none of these forecasts are solidly grounded The other brand that will survive is the other brand with very strong manufacturing capability and an overall strategies on artificial intelligence with strong technical capabilities. The existing sales volume will not secure your future success. I think Geely Auto really stands out in this regard in the Chinese market. Not long ago, Geely launched a new satellite into the space. The launch of the satellite is part of our effort to develop our new technologies for the auto market. We believe that with the development of artificial intelligence, the advanced driving experience cannot be built solely on the vertical integration we need horizontal integration at the same time to ensure the optimal driving experience so all this mindset and mentalities ensure our success in the past one and a half year we believe that if we continue to do what we've been doing in the past if we continue to make sure that Geely becomes a strong technology company, we'll enjoy the bright future. Last but not least, I'm going to tell you that the one Geely after the big merge holds bright future. Thank you very much. Thank you, Mr. Gui. Now it's time for Q&A. We welcome questions from our online viewers. Now the floor is open for questions. So please have the microphone. My name is . I have two questions. The first question is related to intelligent driving or ADAS. So with regard to . So what is your plan to further develop this Chinese Zhijia system? Secondly, in terms of export, HEV and PHEV will make breakthrough in the European markets by other Chinese brands. So how to make sure that you're going to use your diversified brand portfolios to enter different niche markets in overseas market? Well, thank you very much for your question. I believe you're interested in these two questions and the answers to these two questions. So first of all, I would like to thank our media friends and our investors for your support to Geely. Thanks to our continuous support. Thanks to your valuable input during our business growth and expansion. And we've made a lot of progress and we made improvement based on your feedback. So back to our two questions. The first question is related to intelligent driving system or ADAS. The other question is to our international strategy. Starting from September 2024 with the launch of title declaration, we're going to... focused on key strategies, key markets, key personnels, and key mergers and acquisitions. So in short, we're going to integrate our internal resources to avoid wasteful and duplicated investment and input. We're going to improve our overall competitiveness. And in short, all this will be done under the one GLE umbrella. So everything we do must center around this big strategy. On March the 3rd this year, we launched our ADAS system which is called the Chenyi Haohan. So there are five levels of ADAS from H1 to H3 to H5 to H7 to H9 covering different needs of the customers and different niche segment. So we're going to develop one set of strategies and deploy different intelligent functions according to the computational capacities on different models. At the very beginning, The intelligent driving is based on sensing to computation to decision making. So this is the original model. We can't cover the whole spectrum of scenarios, especially the very particular or specific scenarios, especially in turning, on ramping. So this old model cannot cover or be applied to this very specific scenarios. So with the rapid growth of artificial intelligence technology, we'll be able to use the large language model or large model to cover the whole spectrum of application scenarios. This is a general trend in the development of intelligent driving. The success to one model is based on the following elements. First of all, we need very strong computational capacity. The second element is that we need to have a very good model, the large model. And thirdly, of course, we need data, big data, huge amount of data. Computational capacity, big model, and a big set of data. These are the three key elements to the success of the intelligent driving technology. So we established a company, which is a company dedicated to the development of that intelligent driving system in the area of AI or big model or in computational capacity. Hygiene is a very, very strong company in terms of its technological portfolio in March this year. We announced a new architecture of in-chip computational capacity. So the total computational capacity within the chip is 23 EUFLOPS, which allows it to rank number one in China. In terms of large model, we used a multimodal large model. with our in-chip model to make sure that I can provide a lot of human-like functions and interactive models And in terms of engineering of these artificial intelligence technologies and in terms of mass production capacity, I think Zeker has provided a lot of strong support. So by putting all these elements together, we have established our competitive advantages in this market. Last month, we released our new technology architecture. including our world model, foundational, fundamental model, and VLA model, together with our end-to-end adversary safety model. So with all these models, we'll be using our cloud-based model to train our car-based model We can also use our car-based model to verify the cloud-based model. We're making very rapid progress in the development of these technologies. And these technologies will be deployed to the models we are about to release in the second half of this year. If we take the overall picture of ADA's market in China, there are two main models in ADA systems. The first one is self-priority system, the other one is what we call the black box system, meaning you outsource your ADA systems to the third party. I think probably in the future intelligence or artificial intelligence will be the very basic function of a vehicle. It must be technologically advanced. So technological advancement is the prerequisite and it must be an active system and it also assumes a certain scale of economy. to ensure the success transition toward intelligence, we need high quality large model. Talking about the active development, I think we should always be taking the lead in the development of the intelligent technologies in the industry. We must maintain our own R&D capabilities. And thirdly, we must assume a certain scale of economy.

intelligence development requires a huge amount of capital investment so skill of economy plays a critical role in this regard so with the launch of this structure we hope that the core competencies and the advantages of these products will not only serve different product lines but also meet different customers' requests so that we can empower the entire industry by bringing more choices and products to the whole industry. Of course, our aim is far from the so-called first tier. We also hope that our offerings can be the benchmark of the whole industry. On whatever fronts, including HR, the computing power base, and the infrastructure building, and in terms of some other aspects, we are really among the best in China. So that's what general impression and general requirement is all about for the Qianli Haohai H5 structure. So that's the answer to your first question. The second question is about internationalization or specifically the export issue. For H1, export volume has been about 2.58 million sets up by over 10 percentage points. For GD, for H1, our export volume is 1.84 million, down by 7.7%, which is quite far away from the industrial average by 10.8%, as Mr. Gui has mentioned in his comment. So this is far from satisfactory. But if you further break down the performance for H1 this year, it is largely influenced by the single market in the Eastern European market. the sales volume in the Eastern European market was down by somewhere around 40% to 50% due to some structural issues. So this will be translated into about 20% of the year reduction of increase of our export volume for the first half of this year. But this factor out or excluded, our general improvement rate is about 42%. So in general, our export volume and the structure was continuously optimized. And for H2 this year, we will stick to the system or the policy of diversification and internationalization to handle different complexities of the international market. the overseas market has undergone some serious changes. As I said, we have a one GD, one team structure. By one GD, one team, I mean we have a one team, otherwise known as the operating entity under one GD group. I myself was the chief manager of this operation entity. For the next step, we are going to do more things including global coordination and regional cultivation. The overseas development should also be included as part of the priority programs. The first The first thing that we need to do is to ensure we can have some structural changes. Secondly, we need to set up five overseas regions. The first region is Europe. Secondly, Latin and Africa. Thirdly, Middle East and ASEAN and Eastern Europe. So after the founding of the five main regions, all the brands have to be operated under these five main regions for overseas development. In medium and far end of the operations, there should be one same platform. We need to highlight the so-called after-sales service outlet and competencies. So this is what I call the so-called structural change. Secondly, product aspect. Looking ahead, our export has to be dependent upon the development of both IC models and EV models and there should be some regional specific product launch strategies as opposed to the simple strategies in the past so the unilateral and simple way out in the past actually has taught us a lot of key lessons maybe some of the demands cannot be fully met and there are some of the redundancies over the management of some of the markets. At the same time, we also have to stick to high volume and high value overseas growth. So the adaptability of the local products in overseas market has to be another issue that we need to correctly handle. We have five design centers, five experimental centers and five HR centers and five AI smart ecological clusters. So all these five big parks or facilities or centers will help us to cope with the different specificities of the product portfolios. In terms of smart technologies, also we need to quicken our steps to deploy more products. There have been a lot of deployments and different arrangements of those products. management routes for ICEs and for NEVs for Bing Yue, M-grand, China Star, Bo Yue Star. These are some of the blockbuster product series that we need to handle properly. Secondly, we need to ensure that the Galaxy products will have a better international performance. This will be translated into another setting point in the future. You know, the growth margin, i.e. 145% for the first half of this year for NUV could be a very good result. But looking ahead, with Bing Yue and Xin Yue L coming to the international market one after another, this could be another harbinger to more rosy results. down the road. So my expectation is 130 percent minimum for the H2. For Lincoln Co., the focus should be on 08. So we hope to launch more products in Austria, Czech Republic, Mexico and other countries. For Zika, the priority should be on GX and 009. because you know 009 in Hong Kong Malaysia Singapore and Thailand were quite popular especially MPV versions have been among the top selling models locally for H2 of this year we hope to launch three main regions to accommodate the sales volumes above the threshold of about 100,000 units. We hope to achieve what Mr. Gui has mentioned in his comment to ensure a positive growth being registered confidently. So our exports began to recover. It's lost momentum to over 80,000 units. I hope that the serial growth momentum will also be registered in the days to come. Thank you. Okay, next speaker. Okay, first of all, congratulations on achieving good results for the first half of this year. I come from Eastern Securities. Two questions from my perspective. First of all, about high-end product launch. Just now, Mr. Wade mentioned about the product launch strategies. My question is for Lincoln Co. What is the latest updates of the change of the leadership and the structure, and also what will be the new changes and practical changes of the channels and the distribution models? You have mentioned about the integration of ZECO, LincolnCo and ZECO. So if there is any change of the sales target of 1 million in the future. Secondly, the anti-fias competition has been put forward early this year in our automotive industry. So as the leading player in this industry, what should be our correct attitude about the Galaxy series in H2. Maybe the policies would be no longer a relevant factor next year. So what should be the response of GD in response to the change of the policies? Thank you. I will answer the first question and I will leave the next question to other speakers. So integration of Zika and the Lincoln... You know that last September has seen the launch of the Taizhou Declaration. Under the leadership of the Taizhou Declaration, on November the 14th, it was announced to the public that Zika and link alcohol will be merged with each other. On February 14th, the final settlement was concluded for the integration of the two. So since the announcement to the final settlement of the agreement, this is a critical period and results to implement the key ethos of the Taizhou Declaration. In the wake of the Declaration and after the merger was done, so what has brought to the whole company in the wake of the emerging acquisition. I want to share with you some of the statistics, first of all in terms of the sales volume. So I want to share with you the key figure that it was improved by about 14.5% compared with the same period last year, I mean the H1. We are not so happy about the result. I think it is concomitant with some of the relevant and necessary changes of the HR systems and the setting systems and the marketing systems. We're not too happy about that, but anyway, that's the result. For some other areas, in terms of the R&D expenditure, after integration, the Zika R&D ratio is about 2.9 RMB-Yuan, but now it's about 2.1, so it was down significantly. But I want to add one more point. Zika tech company is a US listed company, but the US standards or US policies, I think they are all being converted into expenditures or expenses. So I think the Efficiency management ratio is about 12%. For the comprehensive gross margin, that's about 9.7%. This could be regarded as a very good result in our industry. If you calculate the key figures from Q1 and Q2, but for the whole vehicle, gross margin, gross profit margin for H1 that's about 16.9 percent by comparison H1 last year about 14.3 percent so you can see this figure increased positively for net loss last year the figure was around 7.7 billion RMB for the first half of this year, about 1.1 billion RMB. For Q2, for the first time of this year, operating profit was hitting about 285 million RMB for the first time ever it began to float above the positive level so these are some of the indicators that you might be interested in So by whatever standards compared with the same previous last year, or if you calculated the performances for Q2 and Q1 after the merger was completed, basically you are left with the impression that the figures tend to suggest positive results in the wake of this financial change and structural transformation. Looking ahead, I think you are very interested in what may lie ahead of us, especially in the areas of product integrations and portfolio accumulations. I want to say that the integrational effect of Zika and the Lincoln Co. will still be positively felt in the future. And at the same time, our team is of the conviction that this integration will also be translated into better results and better sales performances.

So after the strategic integration, integration between Geely and Zika will outline our strategic route more clearly. As Mr. Gan mentioned, I think the China, what we call the concept of China chip will be applied to the Geely's ICE segment. We're selling more ICE vehicles in the past couple of years and at the same time we're trying to export the ICE models to the overseas market. As to the Galaxy models, the Galaxy will become a mainstream NEV brand. The focus is on practicality, intelligence and safety. So after the mergers between Lincoln Co and Zika, the Lincoln Co will continue to become a trendy and premium and sporty and tech-savvy brand. As to Zika, Zika will continue to go up. The launch of NIAX and AX models and the deployment of super hybrid technologies is the demonstration of that point. So the focus is on being premium technology and extreme experience. So we've got very clear-cut sub-brands facing different target audience. It's just a scale of economy. This is certainly an advantage of GDF to the mergers of different sub-brands. there will be significant decline or deduction in administrative expenses and other expenses. Zika and Zika technology, after the mergers of the three companies, we're going to see a strong reduction in cost in R&D spending. So this is the significance of strategic integration. So in the second half of this year, the Lincoln Cole, the Galaxy or the Zikr, the product portfolio will be more competitive. The Lincoln Cole 900 has already launched to the market. We're expecting a better performance of it in the second half of 2025. for Lincoln Co. We're going to launch a Lincoln Co. EMP S2 Galaxy which is featured by 09 and Zeker represented by 9X. These will be two new series under these two brands. These are some of the new models we're going to launch in the second half of this year. and also there will be upgrade of existing models and there will be launch of new technologies into the market they will help to improve the sales performance and they will help to improve our financial performance at the same time I believe there will be better sales performance better product structure and portfolio And we're going to see the launches of new technologies in the second half of 2025 in super hybrid, in 48 voltage, and the new generation of 900 voltage battery packs. So these are some of the new technologies we're going to apply in the second half of this year. And there will be an optimized product structures based on these technologies. in the future so we're still confident about our market performance. Our annual target of 3 million units is possible with improved product structure. Thank you. As to the anti-evolution or involution strategy Geely is probably one of the first companies that openly support the strategy of anti-involution. In terms of the competitive landscape, we're not going into a price war. We are going into a value war, tech war, quality war, brand war, service war. and equally important moral war. We advocate for open competition and benign open competition. We put emphasis on value proposition. We put a lot of emphasis on the improvement of overall competitiveness to ensure the benign development of the entire industry. And secondly, we're going to leverage on influence over the logistic or supply chain. In response to the calling from the relevant government agencies, we will reduce the payback period to our suppliers to 60 days. As an influencer in the supply chain, we're going to make sure that the healthy development of the entire value chain. Mr. Gui has just shared with you some of our efforts in improving customer experience, improving the emotional values provided to the customers. I've got a couple of additional remarks to make in this direction. In the area of safety, Geely is probably the first company in China that advocates for safety parity. This is by no means a lip service. We launched the Qianli Haohan system, the Thor system and digital chassis technology. With the launch of these technologies, we have realized the mass production of these AI technology, deployment of these AI technologies over a wide spectrum of GD models. I think safety is definitely a key element in the principle of customer first. And fourthly, a robust operation. Under the guidance of the title declaration and in the spirit of OneGD, we are making progress in the integration of internal resources stable operation of Geely is very conducive to the healthy development of the entire auto industry. The Chinese government proposed a healthy competition and an anti-involution strategy and this calling is for the benefit of the entire industry and the entire supply chain. Fijili, which is committed to long-termism and which is committed to its overall competitive capabilities, we're going to stand out in this regard. Any other additional remarks from other executive members? I got a few points to make. You raised a very important question. In the first half of this year, we can see that there is a very fierce competition broke out in the auto market in China. The total sales volume was 13 million units, registering a 13 point, documenting a 13% increase. thanks to the favorable policies from the government, which puts in a lot of new driving impetus to this market. The government policy is very, very effective and favorable to the growth of the auto market in China. And at the same time, we can't deny that there is a very, very fierce competition in the auto market. in the first half of this year. This is the first point. The second point is that the industrial concentration is reaching a new height. The top five auto companies in China accounted for 47% of the total sales volume in the first half of 2025. That number rose from 38% in 2023 to 48% to 43% in 2024, meaning the concentration rate of the industry increased by 5 percentage points every year. Secondly, the transition, we can see that there is an acceleration of the transition toward new energy vehicles. So the sales volume of NAV did 5.5 million in the first half of this year, registering a 34% of increase The penetration rate of new NEV is reaching 50.4%, surpassing 50%. For GD, we sold 1.4 million units, an increase of 47% over the same period last year. We registered a positive growth in ICE business, which is 21%. In July, Geely sold a total of 230,000 units. That's about 57.7% increase, year-on-year increase. For five consecutive years, we registered a positive growth over the same period of last year. So in the second half of 2025, we'll continue to put in efforts in our safety, quality, and service. We're not going into price war. We're going to make sure that we can still enjoy the competitive edge with regard to price-quality ratio. So how to achieve that target? First of all, we must make sure that we are in the technological leadership in the market, meaning we're going to deploy more leading technologies to empower our products, for example, the Prime Auto, FlyMe Auto technologies. will be deployed in all the Galaxy products and then China chips will also be deployed across different segments and in terms of intelligence H3 autonomous driving will be deployed to the models we're going to launch in the second half of this year So 2025 will be a product offensive year for Geely. Five Neve models and one brand new ICE models will be launched in the second half of this year. So on August the 8th, the Galaxy A7 was just launched, which received a very hot response from the market. So far we received a total of 30,000 orders on our order books. And on August the 28th, August the 23rd, the pre-sales of our new Galaxy model will start. NIX will also be launched toward the end of Q3 and through Q4 and Lincoln Co. EMP will be launched next month. So as Mr. Allen has said, we are going to improve our product structure through the launches of new models in the second half of this year. Our target is to make sure that every new model we launch in the second half of this year will become a blockbuster.

So another key point which is also very important is how to ensure profitability based on efficiency, be it sales, management or R&D efficiency. I think we will There will be a lot of improvement on all fronts to ensure that our efficiency can be raised to a new high, especially the H1 efficiency and interim result announcement could be the first step and there could be more things to be looking forward to. I think there will be a better announcement of the results. Previously, we have mentioned about the technological empowerment, be it on software, hardware, or Thor power train system. Now, it is up to the version 2.0. The thermal efficiency has been up to about 47.26%. This is also very good through the big models and the big data empowerment. We have actually been accumulating a lot of comprehensive strength at all times. For the next half of this year, the 9X or L3 assisted models will be coupled with the latest technologies. As I said, technologies will become the next key pillar to drive forward the new round of growth of our products on all fronts. So that concludes my intervention. Thank you. Well, actually we have a lot of questions from the investors, but now we welcome questions from the media friends. I come from Phoenix Weekly. My name is Haolin. Two questions. First of all, Judy has announced a series of integrational policies. What are the results of the integration? Secondly, you have mentioned about scale of economy. My question is, what should be the facets or the dimensions based upon which we can see the positive strength and benefit of the scale of economy? Well, I failed to catch your questions. properly. Would you please rephrase your questions? First of all, scale of economy. The first question is, what are some of the results of your integration? The second question is, anything that you can do to ensure that we can optimize, keep optimizing the cost structure to ensure the scale of economy? Mr. An, maybe I will take the lead. So the scale economy could be a very serious issue. Actually, I've already mentioned a little bit about how important scale economy is. So for whichever product that we are going to launch in the future, it should be a blockbuster. The scale economy should not only be represented through the whole vehicle management, but also through the supply chain management. So I think that the scale economy could be... delivering a huge impact upon the whole chain, the whole system. As I said, we are based upon a modular system or the configuration-based system. So this configuration or modular-based system determined that our modules are really largely configurable. For H1 this year, there has been a lot of changes of the whole system. We have set up about nine operational entity companies. So these nine companies are complete with R&D, ASCII technologies, product management and supervision, product cost reduction, and many other fronts. So this is an all-inclusive entity. This is an entity fully responsible for the spare parts. management under its system and in the past this system is actually disengaged from the so-called scale of economy as you have mentioned but looking ahead we need to break away or break down the silos between different systems so that different elements could be factored in into our future systems for unified bidding process By doing so, we can ensure the further reduction of the cost and to further boost or drive forward the competencies of our performance system, be it the C structure or the Hau Han structure. You can see a lot of living examples. For Xin Yue, you know, within a short period of about 13 days, the sales volume is over 10,000 units covering being the so-called champion selling models across all product portfolios or types. So this result is achieved by the so-called scholarly economy. Secondly, software also no exception. For software aspects, the investment is once off in nature, followed by some maintenance regularly from time to time. So we need to be sticking to the original principle unswervingly by launching more programs to ensure the scale of economy can be further released. I want to affirm one more point. What can we interpret based upon the so-called scale economy? Because this huge integration has a lot to do with this topic because the different products may cover different portfolios but at the bottom levels there are a lot of things that we can talk to each other in the past maybe there's a silo mentality the silo mentality is quite killing and quite harmful we need to break away from the cyclical vicious cycle to be disengaged from each other or detached from each other as in sharp contrast to the improvement of our efficiency on all levels in the form of a skilled economy. I want to offer a few statistics. This year, you can see that the skilled economy can be further represented through some financial figures. The management expense ratio was down from 2.6% to 1.9%, down by 0.7 percentage points. Our expense ratio was down by 6.6% to 5.5%. For R&D investment or input, it could be dropped from 9.1 billion to 8.3 billion, based upon the synergies of technologies. The sales management ratio and the management expense ratio could also be interpreted from the perspective of coordination. In the past, the first figure was about 3.2 billion, now down to about 2.9 billion. The absolute volume of the sales figure has increased by about 500 million RMB, but considering the sales volume up by about 50,000, deducting the cost ratio of the factor, our sales expense remain intact or unchanged so be it from whichever perspective the relative volume or the absolute volume this figure is a key reflection of the benefits of the scale of economy okay any other questions or comments maybe the lady at the back. My question is about the later development of a Qianli smart driving. Any plans for the employee management? Secondly, how huge is the investment for the integration of GD Lincoln Co. and Zika? For Qianli Smart Driving, maybe Mr. Gan could answer this question. I will answer the second question. You know, Geely and Qianli Science and Tech and Lotus have co-set the Qianli Smart Driving Company. But this is mainly set up by Geely and Qianli as a joint venture. This JV should perform its due roles by empowered by AI and big data. It is expected to launch a fully competitive smart driving solution and that solution could ensure the scale of economy across all product portfolios by making full use of our ecological strength. and by doing so also we hope to achieve the number one in our automotive industry in China. Looking ahead, based upon the Qianli smart driving technologies, we hope to discuss the possibility of setting up a new joint venture which is specifically dedicated to empower Geely on all fronts. So for Geely it can also help us to ensure the iterations and upgrading of our current technologies to serve a different product realms. I think these programs have been faced in one step after another.

Please stay tuned.

Just now you mentioned about the size of investments for the integration of the two companies and the two brands or the exit of the two brands. According to the officially signed agreement, the exit price is about 26.87 RMB, the Zika exit. different from the traditional exits on all fronts. For the traditional exits, that means the discontinuation of the company. But now, our exit is totally different from these exits in that this exit is a type of a new reintegration of the two brands. So we give a so-called share swap right for our shareholders. This is also a key difference. This is also a key reflection of how responsible we are to our investors and shareholders. So we Zika investors may have a chance to derive more benefit from the future investment. If you want to calculate the real figure or the value according to the agreed volume is about 2.4 billion RMB, US dollars. I think that most of the Zika investors, we choose to swap their shares to 0175 shares. So this will not take too much of the cash reserve of GD. Maybe some of the investors might not have any relevant or the existing alternative to be converted into cash to ensure the share swap. But so far it is beyond my capability to give you some precise accumulation or the calculation. I think the final figure will not be exceeding about 30% of the 2.4 billion US dollars of size. So for the current, considering the current cash level or the reserve of Gini, there's no problem. Because recently I was approached by the name of the investment banks saying that you are going to exit from the market, you need a lot of money, why not distribute a lot of shares? No, I think we don't have any plans at the moment, and in the future there's no plan whatsoever to do so. Okay, due to the time limit, why not we give a chance to those online investors? Sorry, this lady please, first. I come from Citic Securities. My name is Li Tianyi. In auto sector, two questions. First of all, about high-end solutions. In the past, we have announced that in Chengdu Auto Show, we are going to launch the 9X model. I'm wondering how we are going to position 9X and the positioning of our future models. You have a really clear-cut forecast of the export this year, but do you have also a long-term view about the export scenario or the landscape next year or the year after the next? Okay. High-end solution is more relevant to our global strategy under GD for these three brands, four product lines. Geely Galaxy could be put into one portfolio.

For Zika, Mr. Han and Mr. Gui just said that Zika will be considered as a tech-savvy premium brand. So there are two things we're going to do in the second half of this year. First of all, we must improve the brand awareness. Secondly, we must improve the brand reputation. These are two things we're going to do for Zeker in the second half of this year. Zeker 9X, which is the flagship premium model, will start its official pre-launch toward the end of this month during the Chengdu Auto Show. So 9X will be the first model using the super hybrid technologies with the longest range and fastest charging time. and the greatest acceleration. So it is an industry-leading model using L3, level 3 autonomous driving system. We're looking at technology leadership, which is a global technology leadership. Secondly, we must improve our brand reputation for Zeekr 001, 007 and 007X. There will be a technical upgrade in intelligent cabin in the model battery and electric control systems. And we're going to communicate with our potential customers more frequently. For Lincoln Co., there are two things to do in the second half of this year. The first one is to deploy more intelligent technologies and secondly, there must be the improvement in the performance for Lincoln Co. models. Lincoln Co. L96 will be the first model equipped with the Chen Ni Hao Han data system. According to our preliminary market survey, our customers are quite satisfied with this new technology. These new technologies will be deployed to Lincoln Co. 07, 08. Talking about the intelligent cabin, the Flyme Auto will be upgraded. Talking about the improvement over performance, Lincoln Co. EMP will be encrypted with the EMP 2.0 system. it is going to be a four-wheel drive system improving the thermal efficiency by three percentage point and the transition box efficiency will also be improved and the fuel efficiency will also be improved by five percent a lot of these technologies will ensure that the product will become more and more premium for galaxy models we're going to ensure that there are two breakthroughs in galaxies in the second half of 2025. So first of all, there must be a breakthrough in the new electric hybrid system, powertrain system. So the hybrid powertrain is probably the mainstay of the electric, of the NEV market. So if You conquer the hybrid market, you conquer the NEP market. So we're going to launch two new products in the second half of this year. One in Q3, one in Q4. They will all be hybrid. They will both be equipped with the hybrid powertrain. And secondly, we must make breakthroughs in launching a flagship model. the Galaxy 09 will have its debut in September this year so that we can further increase the value proposition of Galaxy as to China Star system or China Star model we're going to introduce more intelligent technologies to ICE So the combustion engine vehicle should also be equipped with intelligent driving system. And secondly, we also need to upgrade our classic model. As we just announced, the M-Gram, the fifth generation of M-Gram, will be built upon new architecture, new electric system, new intelligent driving systems. If for a classic model, we need to upgrade them one generation after another. So we're moving into the fifth generation of Amgram. So the whole series has enjoyed a total of 4 million sales units in the Chinese market. Thank you. As to export, we've made some target as to the export volume for the second half of this year. And we also set up some export target for next year and the year after next. We're still in the process of formulating that target. But as to product itself, we've already settled on what kind of products we're going to export to the overseas market. And at the same time, we need to set up our after-sales capabilities in overseas market. Without proper after-sales services, it would be impossible to export your products to overseas market. So when it comes to international market, we must be resilient. and at the same time, we must maintain our stability in export volume. Thank you. At the same time, we have collected a lot of questions from the online viewers. Due to time limitation, I can only rewarn online questions. Well, it seems to me that you have a rather lag behind schedule in terms of the improvement over the pre-unit cross gross margin so what kind of strategy are you going to employ in order to improve the gross margin? I think the decline of 0.3 in gross profit margin in the first half of this year is related to the price war in the auto market in China and secondly Our premium models will be launched in the second half of this year, so it'll be rather simple to answer your question. At the same time, the government is trying to rectify the auto market in China. And secondly, we're going to launch more premium models. into the Chinese market during the second half of this year. So that will see the improvement over the gross profit margin. So due to the time limitation, we have to draw a conclusion to the press conference. So before we conclude the press conference, what our executive members need to say to the audience? So first of all, thank you very much. for attending today's press conference. So, Julie Otto is still blazing on a treacherous road. We're more confident than ever before, as I said. The central government as well as the central government agencies have launched a lot of policies to rectify the automobile market in China so Geely will follow the instructions from the government and take efforts to fight against unnecessary involution involution is by no means a mere price war for Geely we must learn from our competitors We don't want to say anything bad about our competitors, and we must do our homework well. If each and every Chinese automakers do the following three things, the above three things, we definitely will drag ourselves out of the downward spiral of involution. For Geely, we just try to do our things well, and thank you very much once again. Thank you very much for taking your time out of your busy schedule to attend the press conference. We do have a lot of questions collected from the online viewers, but don't worry. Our executive members will engage in roadshow in the next couple of days, so you can book your meeting time with our executive members in the next couple of days. Thank you.