Huawei's "Let-Go" Policy for ASQI: Good News or Bad News for Seres? A Game of Independence and Survival
Hello everyone, I'm your financial observer. Today, we're talking about the hottest news in the automotive industry: the cooperation model between Huawei and Seres (ASQI) is about to change.
In simple terms, previously, Huawei acted like a "nanny," taking care of everything from car manufacturing, sales, to after-sales services. Now, Huawei is shifting to a role more like a "coach" or "supplier," providing only the technology, while Seres has to figure out the rest on its own.
As soon as the news broke, Seres' stock price plummeted by more than 5%. Many people were worried: Does this mean Seres is being "weaned off" Huawei's support? Can Seres still thrive on its own? And what exactly is Huawei's motivation behind this change?
Don't worry, let's break down the situation and analyze the logic behind it in detail.
---
From "Sparrow" to "Phoenix": Seres' Dramatic Rise with Huawei's Help
To understand the current concerns, we need to look at how dire Seres' situation was before and how it managed to turn things around.
1. The Once-Invisible Company
Before 2022, Seres was known as "Xiaokang Co., Ltd." It mainly produced microvans and low-end SUVs, supplying seat springs and shock absorbers for Changan. Although it was making a living, it was just an inconspicuous player in the automotive industry.
2. The Pain of Betting on New Energy
CEO Zhang Xinghai had a keen eye for the future and saw that traditional fuel vehicles were on the decline. In 2016, he sent his son to the United States to work on electric vehicles. However, the reality was harsh: the first car, the SF5, only sold 700 units in its first year. Meanwhile, sales of its traditional fuel vehicles declined, and the new business was costing a lot of money, turning the company from profitable to loss-making.
3. Huawei's Entry and a Turning Point
The turning point came at the end of 2021 when Huawei introduced its "Intelligent Selection" model, and the two companies collaborated to create the ASQI brand.
- What did Huawei do? It provided technology (HarmonyOS cockpit, intelligent driving), the brand name, sales channels (Huawei stores), and marketing support (with Yu Dazui personally promoting the brand).
- What did Seres do? Seres was responsible for manufacturing, production, and managing the supply chain.
The result? The ASQI M7 and M9 were a huge success.
- Numbers Speak: Revenue soared 305% to 145.2 billion yuan in 2024 and continued to rise to 165.1 billion yuan in 2025.
- Market Value Miracle: Seres' stock price soared from a few dozen yuan to over 300 billion yuan, making Zhang Xinghai's family the richest in Chongqing.
In simple terms: Without Huawei, Seres might still be struggling in the microvan market; with Huawei's help, it jumped into the luxury new energy sector.
---
Why Does Huawei Want to "Let Go"? To Free Up Resources for Other Projects
Many people wonder: If Huawei has made so much money from ASQI, why change the cooperation model and let Seres go on its own?
The main reason is simple: Huawei's resources are limited, and it can't focus solely on ASQI.
Currently, Huawei's "HarmonyOS Intelligent Driving" ecosystem includes five brands:
1. ASQI (Seres): The leading brand, accounting for over 60% of total sales.
2. ZhiJie (Chery): Focuses on high-end MPVs, with some popularity but struggling in sedans and SUVs.
3. XiangJie (BAIC): Targets executive luxury, but the market is small and difficult to expand.
4. ZunJie (Jianghuai): Ultra-luxury, very niche.
5. ShangJie (SAIC): Targets the mainstream market of 150,000 to 250,000 yuan, with the greatest potential for growth.
The current situation is: ASQI dominates, while the other four brands are still struggling to gain momentum.
Huawei's Strategy Adjustment:
Previously, Huawei invested all its best resources (channels, marketing, executive attention) in ASQI. Now, it plans to distribute these resources to ZhiJie, XiangJie, ZunJie, and ShangJie to help them grow faster.
In simple terms: Huawei was like a "super coach" focusing on one star player (ASQI); now it wants to train other potential brands as well, ensuring the entire ecosystem thrives.
---
Seres' "Bittersweet Burden": Thin Profits and Heavy Commissions
With ASQI doing so well, you might think Seres should be making a fortune. Wrong! Seres is actually in a tough position.
Where Does the Money Go?
Most of the money from ASQI sales doesn't stay with Seres; it goes to Huawei:
- Hardware Purchases: Laser radars, intelligent driving chips, cockpit systems—all purchased from Huawei. In 2024, Seres spent 42 billion yuan on these purchases.
- Service Fees: Brand licensing fees, channel service fees, marketing costs—these account for about 10% of the car's price.
High Gross Margin, Low Net Margin
- Gross Margin: 26%-29%, which is decent for the automotive industry, indicating the cars are sold at a good price and costs are well-controlled.
- Net Margin: Only 3%-4%, meaning for every 100 yuan in sales, Seres keeps around 3-4 yuan in profit.
- Recent Crisis: In the first half of 2025, due to rising原材料 costs and asset impairment, Seres suffered a loss of 1.717 billion yuan.
In simple terms: Seres is essentially a "high-end contract manufacturer and channel distributor." The cars are designed by Huawei, the brand is Huawei's, and the stores are Huawei's. Huawei gets the bulk of the profits. Although Seres has high sales, its actual profit margin is very low. Any decline in sales or increased costs can lead to losses.
---
Is "Going Solo" a Good or Bad Thing? The Market Is Divided
Now that Huawei is reducing its support, will it be good or bad for Seres to take control of product development, marketing, sales, and services?
Optimists (Good News): Savings and potential for higher profits!
- Logic: Seres will no longer have to pay high fees to Huawei. If it builds its own channels and markets, it can save money.
- Potential Increase: Net profit could rise from 3% to 5% or more, which is a significant amount for a company with annual revenue of 160 billion yuan.
- Greater Autonomy: Seres can make faster decisions without constant consultation with Huawei.
Pessimists (Bad News): Without Huawei's brand influence, will consumers still buy ASQI?
- Logic: Many buyers buy ASQI because of the Huawei brand. Without Huawei's marketing support, the brand's appeal might weaken.
- Competitive Challenge: The new energy market is fierce, with companies like BYD, Xiaomi, and Li Auto competing fiercely. Without Huawei's backing, can ASQI maintain its sales?
In simple terms:
- Positive Side: Seres can save money and possibly increase its profit margin.
- Negative Side: ASQI might lose its brand appeal and see sales decline, potentially falling behind competitors.
The Key Question: Can Seres quickly build its own brand influence and sales channels? If not, it will lose both Huawei's support and its independent capabilities.
---
Future Outlook: Can ASQI Become Independent? Can the HarmonyOS Intelligent Driving Ecosystem Repeat the Success?
1. ASQI's Current Situation:
- Sales Growth Slowed: In the first 8 months of this year, ASQI sold 201,900 units, a 14.07% decrease from last year.
- This suggests that ASQI's growth period may have passed, and it's entering a phase of competition.
- Stock Price Drop: Seres' stock price has dropped from a peak of 300 billion yuan to 79 billion yuan, reflecting market concerns about its independence.
2. Huawei's Ambitions:
- Repeating the ASQI Success: Huawei hopes to replicate this success with other brands.
- ShangJie (SAIC): Has the largest market potential and a strong supply chain.
- ZhiJie (Chery): Has a high-end MPV, but struggles in other segments.
- XiangJie and ZunJie: Too niche to drive significant sales.
3. The Big Picture:
- For Huawei: This move is a strategic one. It shifts from a "nanny" role to a "mentor," reducing risks and promoting the development of the entire ecosystem, strengthening its dominance in the smart car sector.
- For Seres: It's a critical test. If successful, Seres will become a strong, independent new energy company, changing its valuation. If not, its sales may decline, and its brand might weaken.
Advice for Everyone:
- For Investors: Short-term, Seres' stock price is highly volatile and risky. Long-term, focus on whether Seres can build its own brand and sales network within 1-2 years. Watch changes in its gross and net margins and sales performance.
- For Consumers: ASQI's cars are still worth buying due to Huawei's technology. However, you may no longer get exclusive services at Huawei stores, and you'll need to adapt to new sales and service models. You can also keep an eye on new brands like ShangJie and ZhiJie for potential opportunities.
In conclusion:
Huawei's decision to let go is not a abandonment but a move towards independence. Whether Seres can succeed depends on its own capabilities. This journey of independence has just begun.